Audience Building and Financial Health in the Nonprofit Performing Arts: Current Literature and Unanswered Questions

Audience Building and Financial Health in the Nonprofit Performing Arts: Current Literature and Unanswered Questions

There is little agreement about the reasons behind the decline in audiences for nonprofit performing arts organizations and no proven solution for reversing the trend, a literature review by researchers at the University of Texas at Austin finds. Funded by the Wallace Foundation, the report, Audience Building and Financial Health in the Nonprofit Performing Arts: Current Literature and Unanswered Questions (34 pages, PDF), highlights several factors driving the decline — including changing tastes, cuts to arts education in schools, transformations in media landscapes, and outmoded business practices in arts institutions. While the authors found little empirical evidence for the effectiveness of attempts to reverse the trend (e.g., marketing research, alternative venues), they suggest that a broad commitment to audience development and close coordination between artistic and marketing departments may help establish a foundation for success in the future. In addition, the review found little evidence of the effect of even successful audience-building efforts on an organization's finances, due in part to a dearth of literature on the financial health of arts nonprofits in general. And while what works at one organization may not work at another, and attempts to appeal to a specific audience segment can drive other segments away, the authors offer a number of questions they believe can help organizations chart their own path in securing the loyalty of their customers and patrons and improve their finances, including: Does your organization define success based on audience size, ticket sales, audience commitment, or something else? How will your organization cover the costs of audience-development efforts? And, are the potential benefits of new approaches worth the costs?

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November 18, 2017