A Hint for the Future of Museums: Europe is Looking to US Aquariums

In my line of work (developing predictive data) and my spot in that line (analyzing and applying data on behalf of organizations equally concerned with social and fiscal bottom lines), opportunity often comes from keeping a pulse on the market. Along these lines, I’ve recently experienced shifts in my professional world that may be illustrative of the future of museums and the broader nonprofit community.

"7 hours and 57 minutes until I am officially based out of Chicago AND London! Let's do this!"

“7 hours, 57 minutes until I’m officially based out of Chicago AND London! Let’s do this!” (4/1/13)

In April, I officially joined the ranks of part-time expatriates (and long-haul commuters) when IMPACTS asked me to help open our London office while also maintaining a “home base” in Chicago.  Preparations for our London office enabled me to hire a Digital Marketing Manager to provide additional support to our projects, and also challenged me to be more thoughtful about how I could focus my efforts to best serve our clients.  A few months removed from my hop across the pond, I’ve been reliably asked two questions from colleagues, other museum professionals and even friends and family – the answers to which are closely related and may provide interesting insight to the museum industry:

1) Why London?

The obvious answer: proximity. I am in London largely because it is an accessible base for much of the work that IMPACTS is currently performing on behalf of visitor-serving organizations (e.g. museums) throughout the Americas, Europe and the Middle East.

The more interesting answer: market demand in Europe for the American nonprofit business model. You read that right! Any quick glance at the news tells stories of shifting economies that have created an unprecedented struggle for many of Europe’s most treasured museums.  While not-too-long ago many of the elite European institutions might have politely sneered at the suggestion of adopting a more “American model” of doing business (especially “nonprofit business!”), these sentiments are quickly shifting.

The “American model” (as it is colloquially referred to in my dealings) is a euphemism for a visitor-serving business that doesn’t rely on government support (or grants or endowments) and, instead, is a market-driven enterprise whose success hinges on engaging a diverse, sustainable constituency.

In other words, many of the world’s greatest museums – the ones that we Americans revere and admire with a distant and mysterious “otherness” – are looking to U.S. visitor-serving organizations as sources of inspiration, innovation and know-how when it comes to reinventing their business models to best respond to their current economic conditions.

2) Why do you spend so much time working with aquariums?

It’s true. I do find myself increasingly spending more time and energy working closely with aquariums. Here’s the end-game: We have an interest in aquariums because they are often cited by our clients as best-in-class practitioners of the “American model.” (Stick with me, other-types-of-museum folks. I’ll connect the dots…)

IMPACTS works with nearly every form of visitor-serving organization from art museums and symphonies to science centers and botanical gardens, and there’s one thing that we’ve found to be generally true: The market-driven practices developed by aquariums may have the greatest impact and “usability” for exalting the entire visitor-serving industry.  While the role of aquariums as models may seem surprising to many of America’s most venerable museums, the relative esteem with which U.S. aquariums are internationally regarded evidences itself in my work on a daily basis. In fact, the European organizations (including many art museums) that I work with have less interest in the “best practices” of American art museums and, increasingly, more interest in those of American aquariums.

Here’s why.  There are two conditions that make U.S. aquariums of particular interest to the global museum and visitor-serving industry:

 

A) The U.S. aquarium business model is motivated by market demand (and not overly dependent on grants, endowments, or government funding)

This is not to say that aquariums do not seek to obtain grants or secure government appropriations – but, as a group, the chart below indicates that aquariums tend to rely least on contributed and dividend revenues when compared to other types of visitor-serving organizations:

IMPACTS Visitor Serving Organization Earned Revenue

Theoretically, if government funding were to cease on a macro-level tomorrow, aquariums (as well as select museums, theaters, science centers and other more self-reliant organizations) may have the greatest chance of keeping their doors open long-term.

Also, after evaluating a representative sample of 224 U.S.-based visitor-serving organizations, aquariums generally have the smallest endowments relative to their annual operating budgets – perhaps suggesting that aquariums must be particularly attuned to the market since they have less “cushion” in their revenue streams. We see outcomes of this market responsiveness all the time: While some museums are hiring extra grantwriters and expanding their lobbying efforts for funding, many aquariums are hiring social media and online community managers because they understand that digital engagement helps drive attendance. Of course, smart museums also realize this and are hiring these kinds of people, too – but as the chart below illustrates, the lack of a “safety net” places a particular financial imperative on aquariums to be responsive to market opportunities:

IMPACTS - Visitor Serving organization endowment backstop

 

B) Many aquariums regularly invest in active, global, social missions that extend beyond education and research

I can hear you now: “But all museums aim to change the world!” I know. This does not mean that other missions are any less important – simply that many organizations with which I work consider aquariums to be at an interesting intersection between topic expertise and “right now” relevance…particularly when it comes to prominent, controversial issues such as climate change and other environmental topics. In short, while the social missions and operations of aquariums tackle education and research (two critical items that are also common among other, select visitor-serving organizations), they also take up the battle of ocean conservation. The initiatives attendant to this addition are particularly timely, global, and live in a rather elusive “save the world” space.

It’s a seemingly at-odds and extreme combination:  Aquariums may be considered among the most “for profit” of organizations in that they rely heavily on earned revenues, but they also aim to be among the most globally impactful among organizations pursuing active, social missions.

 

I “go deep” in my work with aquariums because helping them evolve and perfect their business model to remain solvent in both fiscal and social terms provides the lessons that help other organizations achieve their similarly aspirational ideals.

I’m intentionally speaking in terms of sector generalities – not all zoos rely on government funding, not every museum lives on its endowment, and, for that matter, not all aquariums are truly bringing their A-game to the “save the ocean” effort. The organizations operating with the objectives of being both market-relevant AND “big mission-serving” (aquarium or not) may be our best models for the future of museums. They can survive on their own, and they can do it while serving a very large-scale social mission.

 

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Posted on by Colleen Dilenschneider in Financial Solvency, IMPACTS Data, Myth Busting, Nonprofit Marketing, Sector Evolution, Trends 3 Comments

About the author

Colleen Dilenschneider

MPA. Chief Market Engagement Officer at IMPACTS Research & Development. Nonprofit marketer, Generation Y museum, zoo & aquarium writer/speaker, web engagement geek, data nerd, marathoner, nomad, herbivore

3 Responses to A Hint for the Future of Museums: Europe is Looking to US Aquariums

  1. Darko

    Dear Colleen,

    all facts and figures works here, no question about it, as you brilliantly explained, but are we, and/or is our the uttermost end only about this or something indeed more sophisticated, as e.g. intangibility as exactly heritage easily recognise it. Your additional points about social mission of aquariums explained parts, and I appreciate it a lot, but still is this model all could use – is this something applicable to heritage of Kenya, Argentina or Vietnam at the same time putting aside existing European, or indeed US practices. And if so what is a price of it, if we still believe more in humanity ideals then non-profit which are forced to be profit too heritage sector, whatever sort, or institutions. By being generation X, quite near to gen Y, maybe I am too idealistic in my consideration about a role we have (or like to have, and goals to gain for (indeed globalised) World. I had impression, and could witness over my students they are keen and believe in it. I could easily be wrong, but still…I wondering do we want/fight for a better future or just business sustainable (heritage/museum) organisations. No hard feelings here, I really liked you posts as many previous, thus just questioning…as always as many other European based rooted humanities academic.

    Thanks in advance,

    Darko

     
  2. John R

    Insightful, relevant, accurate…and a wake-up call for all of us in the ZAM world. Thank you, Colleen!

     
  3. Gary Dauphin

    Very thought provoking, thank you for this Colleen.

    One our biggest challenges is that we have been forced to be more-and-more dependent on earned revenues, as we have gotten very limited donations and/or government funding.

    My biggest worry: if all of us had to become self sufficient, we would all be battling for the same dollars from many of the same “customers.” We would, in effect, become a retail entertainment organization instead of an educational historic trust. This would lead, in my opinion, to the marketplace weeding out many of our non profit / educational organizations.

    America, we need your financial support! We have no penguins on display !!!! 😉

     

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