Building Resilience Beyond Federal Funding

The elimination of federal funding for museums, cultural institutions, zoos, and aquariums leaves many institutions grappling. For these institutions, the disruption can feel seismic. The concern is valid; this period requires adjusting and finding new ways forward. These institutions can secure a more resilient future by exploring new funding sources, thinking creatively about earned revenue strategies, learning from the for-profit sectors, and investigating new partnerships.

This group of institutions has been here before: the pandemic proved to be a test for all attractions.

Diane Lochner, PGAV Principal, says, “That challenge provided the opportunity to think creatively, collaborate on the difficulties ahead, and rethink the plan for financial independence. Institutions can educate, inspire, serve their communities, AND operate in a financially sustainable way. It is not an ‘and or’ proposition. They can develop story-based, mission-driven, visitor-focused experiences that are appealing, drive visitation, and create a robust earned revenue model.”

The Impact
Federal funding often supports behind-the-scenes work that isn’t immediately visible to guests. The initial response is often to cut these programs, which can erode the audience base. Institutions with diversified revenue streams and an entrepreneurial mindset will weather this storm better.

Learning from the For-Profit Sector
Private-sector companies thrive in competitive environments by constantly adjusting to market demand, innovating, and product testing. Not-for-profit institutions can look to them for inspiration. Think of the guest experience, including exhibits, food and beverage, retail, etc., as your product. Nike wouldn’t roll out a new line of shoes without extensive testing and feedback. The same idea applies to non-profit institutions.  Lochner explains, “Product development is a strategic and creative process that designs potential guest experiences aligned with business goals. These experiences are tailored to specific customer segments, shaped by brand architecture, and grounded in a cohesive, story-driven thematic concept.” This could include exhibits, theatres, gated entrances, retail, food and beverage, gardens, interactives, animal experiences, transportation systems, or other capital projects that maximize revenue, offer a mix of activities, and collectively form a seamless visitor experience.

Product Testing
Think of an exhibition like a product launch: What problem does it solve for your audience? What makes it unique? Does it deliver on its promise? By answering these questions early, institutions can reduce costs and ensure they resonate with the audience.

Evaluation of these products with audiences is key. Testing allows investigation into the intent to visit, appeal, and perception of the brand across a series of demographic and psychographic audience segments. Gather feedback, measure engagement, and make data-informed decisions.

Audience Research
For-profit companies invest heavily in understanding customer preferences. Non-profit institutions should also know the audience demographically, emotionally, and behaviorally. What are they looking for in an experience? What would make them return or become a member? This level of understanding can help develop high-impact programming and more strategic marketing efforts, even with limited resources.

Losing federal funding is undeniably challenging. Museums that approach this shift with creativity, agility, and a willingness to learn from other sectors can build resiliency. By rethinking how institutions deliver value and connect with audiences, they can future-proof their institutions for whatever lies ahead. Lochner says, “Growth and change can be hard, but both are necessary. Growth in the organization: in thinking, with staff, and in how things are done. And while this is often uncomfortable, it is necessary, especially when the status quo could mean failure.”