Why are our grosses going up anyway?

Last week, the Broadway League issued their latest record-breaking report about the Broadway season (You can read the Executive Summary here).

As we all know, and as we’ve all celebrated, Broadway has been on a decent ride over the past couple of decades, with grosses rising year after year, even topping the one billion mark a few seasons ago.

But why?

Is it the increasing strength of the Broadway brand? Is it the mega musicals like Wicked, Mormon and yep, Spider-Man, drawing more and more international tourists? Is it more stars from tinsel town increasing demand for premium tickets?

Yeah, it’s all those things.

But I also think it’s something much simpler.

We all know that the tourist is the primary component of our audience, representing about 65% of the whole. So . . . yep, you’re getting it, aren’t you.

Take a look at this graph of New York City tourist growth since 1992.


Now, compare that graph with this one, which charts the growth of Broadway grosses.

See the similarity?

Tourists up?  Grosses up.  Simple correlation.

This isn’t a huge revelation, by any means, but the graphs are so similar that it tells me two things:

– We owe a huge debt of gratitude to the city and the businesses that helped clean up Times Square and re-establish the district as a tourist destination.  We tip our top hats to thee.

– In order to grow our audiences further, perhaps some of our resources should be spent nationally, and internationally, encouraging more and more tourists to come to the city . . . for any reason . . . not just for us.  Because when people come to NYC, they take in a show. I Love New York campaigns, Come to the City, etc. could be what helps us break through the records we’re already setting.  (In a case of tragic irony, I expect the 9/11 Memorial and the Freedom Tower to add significant numbers of tourists to the city when they are completed.)

There is a coda to this story, and unfortunately it’s not as full of puppy dogs and rainbows as this blog.

Check in tomorrow for another graph, and a somewhat sadder tale.


(Got a comment? I love ‘em, so comment below!  Click here then scroll down to say what’s on your mind!)



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  • Lynne says:

    Hi Ken –

    Is the grosses chart adjusted for inflation? I think an argument could be made that the rise in grosses could also be attributed to the gradual increase in overall pricing across the board. In 2007 we see the grosses go from flat to increasing again which does not match the flow of tourism – but isn’t that when VIP tickets started being introduced in full force?

    Just another viewpoint.

  • Douglas Hicton says:

    While the two graphs do show a correlation in overall shape, their slopes are very different.

    From 1992 to the present, tourism has roughly doubled, but Broadway grosses have gone up by about 350 per cent. That’s a 3.5:1 ratio. Also, roughly every eight years — 1992-93, 2000-01, 2008-09 — there’s a dip in tourism, but while there have been times when grosses have levelled off, there’s only been one period of downturn in Broadway’s coffers, in 2001.

    Now, this could mean that Broadway marketing has been so successful and dynamic that it has led to an increase in the percentage of tourists who attend Broadway shows when they visit New York, but we’d have to see a graph of the actual number of bums in seats in order to know that, not just the gross money figure, which I think is misleading.

    So the probable reason for why grosses are going up is that Broadway has been charging an ever-increasing number of arms and legs for its shows, and when that happens, one is bound to end up with a surplus of elbows and knees. In other words, Broadway is taking in a whole lot more money because ticket prices have exploded, which is only logical.

    And they will probably continue to rise until ticket prices start to discourage attendance so much that revenues start dropping. Let’s see what happens in 2016-17, when the next dip in tourism is due.

  • Jim Jomes says:

    Correlation =/= causation. Take a statistics class.

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