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When most people set foot in an art gallery, their focus is on the artwork – as it should be. The vast majority of art galleries are labors of love, and gallerists take great pains to make sure the art is the focal point. But artists tend to think about art galleries differently than the general public, begging the question – how do art galleries make money? What do their funding models look like? And, most importantly, how does that affect their relationships and interactions with artists and their communities?
Do Art Galleries Make Money?
Yes. Almost every art gallery – at least, every successful art gallery that’s able to stick around long-term – makes money in some way. Most art galleries aren’t in it for the money, but of course, they need some revenue in order to keep their doors open.
This revenue goes toward paying rent for the gallery space, employee salaries, marketing, etc. Every art gallery has a different way of making money to stay afloat. The specific approach of any specific gallery depends on its business model.
There are also state and government-funded galleries. For important artwork, a taxpayer-funded gallery can be an important part of national culture. It’s also a potential tourist attraction.
Do Galleries Pay Artists?
Most galleries compensate artists based on commission. When a piece sells, the gallery and artist split the sale price. This rewards artists who make art that visitors gravitate toward while paying the gallery for creating a space for art to be admired and purchased.
What Makes an Art Gallery Profitable or Successful?
There are a lot of ways to measure an art gallery’s success – longevity, cultivating and maintaining successful connections and relationships with artists, or serving a role in the community. And, of course, profitability plays a role in that. Like artists, most art gallerists aren’t in business for the money.
Money is necessary to keep a gallery up and running. But it’s not uncommon for galleries to struggle to turn a profit, even if they’re using multiple funding strategies like the ones mentioned above. So, what separates the profitable galleries from the ones struggling to make ends meet?
- Marketing and branding. It sounds cold, but art galleries still need to spend on marketing. If they don’t put work into setting themselves apart, visitor numbers decline.
- Keeping overhead costs like rent to a minimum can help. Art enthusiasts tend to be willing to go out of their way to find good art, so saving money on a more out-of-the-way location can pay off for some galleries.
- Catering to a broader clientele. When most people think of “art collectors,” they imagine the wealthy and privileged who own massive personal galleries. Galleries that position their offerings as accessible to customers outside that specific demographic tend to reap the benefits.
- Paying staff well enough to make them stay. One case study found that art galleries actually tend to perform better and become more profitable when gallerists prioritized paying their staff what they’re worth.
The guide below explains a lot about how galleries work and the important role they have in the art community.
