Commercial thinking is key for success, according to new report

Cultural organisations that integrate commercial thinking into strategic decision-making are consistently more successful in generating income.

That’s the finding of a new research-led report published by the Association for Cultural Enterprises that examines the factors driving financial resilience in the sector.

Data and insights from more than 260 sites show that organisations where commercial expertise is represented at senior leadership and board level and embed commercial thinking in strategic decision-making consistently outperform those that do not.

A Seat at the Table: Embedding Commercial Thinking in the Cultural Sector offers practical guidance on where the opportunities to grow income lie.

It shows that commercial activity, such as paid-for events, retail and filming, now makes up the largest proportion of income for cultural venues in the UK, averaging 40%, ahead of fundraising, grants and ticketing.

While the data highlights the challenges faced by weather volatility, economic pressure and international shifts, it also urges organisations to reduce their risk by offering advance booking, flexible offers and more adaptable on-site experiences

Crucially, it states that programming is the primary driver for both visitors and visitor spend, especially where this aligns with peak seasonal moments such as Christmas, summer and Easter.

And it concludes that growth will increasingly come from four areas – local and repeat audiences; new audience segments; premium and experiential offers; and stronger retail and catering propositions.

Melanie Lewis, the association’s chair, says the report highlights the increasing importance of commercial capability as a core part of organisational resilience.

“What is particularly encouraging is the evidence that cultural organisations are not only adapting to challenging conditions, but are doing so in ways that remain true to their purpose and values,” Lewis writes in the report.

“The organisations that are succeeding are those that are embracing a more integrated approach, where programming, audience engagement and commercial thinking are aligned. This is not about compromise – it’s about innovative solutions to strengthen the long term sustainability of the sector.”