Bears vs. Bares. Part II

This just in …

Crunching more numbers provided by The Guru of Statistics at the  Broadway League,  Neal Freeman,  the average paid admission to a revival of a musical in the 07-08 Broadway Season is . . . . drum roll please . . .

On second thought . . . let’s play a game.

Pick one:

A. $73.76
B.  $53.51
C.  $61.01
D.  $69.61

The answer will be revealed at the end of this post (no cheating).

But the answer isn’t as important as what you do with it.

Now that I know what the market is bearing in terms of ticket price, AND what kind of  shelf-life  I can expect, I can start to build a proper budget that is based on reality, not fantasy.

As my shrink once told me . . . it’s ok to fantasize, as long as you know you’re going to be ok if the fantasy doesn’t come true. For example, I will be ok if Winona Ryder doesn’t go to my high school prom with me (that was my fantasy in 1990, but you get the point).

Well, if a budget based in fantasy (with higher than average ticket prices and higher than average attendance figures) doesn’t come true, your investors are NOT going to be ok.  They’re going to have lost a lot of money.  And you’ll lose investors.  Which means you’ll produce less shows.  Which means the world will not be a better place.

D. $69.61

And if you’re curious, the average paid admission to a revival of a play is $55.67.

When you think about it, what the market bears, is similar to what the market bares.  By looking at the hard numbers, you’re looking at the industry naked.  No Versace or Marc Jacobs dressing it up.  Just cold flesh.

Unfortunately, it’s not always good naked.  Happy Holidays!

 

Happy Holidays!

Putting What Broadway Bears Into A Box.

When you sit down and prepare to budget a show, what’s the first thing you do?

Figure out how much the theater is going to cost?  Figure out how much the creative fees are going to be?  Or how much you’re going to spend on hair styling bills for a star that submits a receipt for reimbursement every time she steps outside? (true story)

It makes sense to start off with this stuff. But I recommend that before you work on your own show . . . work on everyone else’s first.

For example, I’ve got a bee in my you-know-what about reviving a certain Broadway musical.  So I’m looking at all the other revivals of the last 20+ years first.

And by looking at their numbers, I can create the beginnings of a budgetary box that I can fit my show into based on hard empirical data on what the market can bear.

What’s the first thing I looked for in this search?  Length of run.  Here, exclusive to you, oh faithful blog reader, are the results of numbers crunched by me and my assistant Nicole, thanks to raw data provided by the 

Broadway League.

The following is the average length of runs of productions on Broadway since 1984 (note: some of the productions included in these calculations may still be running)

New Musical                         52.67 weeks

Revival of a Musical               51.59 weeks

New Play                              24.40 weeks  

Revival of a Play                     15.65 weeks

Interesting stuff, huh?  Now, if I know that an average revival only runs 51.59 weeks, I know I better figure out how to recoup the investment in that short period of time.

But Nicole and I are not done yet.  The next figure that will help me build my budgetary box?  Average price of a ticket.  For a revival.  Of a musical. 

Stay tuned.

Size does matter . . .

But not in the way you think.

General Managers and Producers are always trying to figure out how to make shows work economically.

The old trick is that if it’s not working in a specific theater . . . put it in a bigger one!  Your Gross Potential goes up, and therefore when you show an investor a recoupment schedule based on percentages, the show looks more viable.

70% of 2000 seats is a lot better than 70% of 1000 seats, right?

But here’s the rub.

Just because you put the show in a bigger theater, that doesn’t mean that more people are going to go.  Duh, right? 

Here’s what I like to think of when I choose a theater.

Yes, economics are important, without a doubt.  And I’d look at the average # of people coming to see Broadway or Off-Broadway shows on a nightly basis to determine what is appropriate.

But just as important is the feel and the energy inside the theater. 

I like my theaters to feel like a soda can that is shaken up – so filled with energy and excitement that it could burst! 

And then, when you open the doors at the end of the show and let your audience out, it’s like opening up that shaken soda can . . . and all those people go spilling into the streets and all over everything else, gushing about what they just saw, because they can’t help it. 

Those are the people that are going to sell tickets for you. 

And a smaller more energized theater also means a harder to get ticket, less seats to fill so less advertising expenses, lower theater expenses and an overall better experience for the audience.

So get people excited with something smaller.

Houston, we have a distribution problem.

Broadway is in the heart of Times Square in New York City . . . and nowhere else.

And, no matter how much I want to get a petition going to move it to sunny southern California, it doesn’t look like it’s going anywhere soon.

Broadway isn’t like Tide detergent, available in every grocery store around the country. It’s not like the latest Avril Lavigne album available in every Virgin Megastore and on iTunes on the computer you’re working on right now.  It’s not like American Gangster, which will play in movie theaters in New York City and in Nashville, and in every city around the country and around the world at the same time. 

Unless you’re one of the lucky shows with 15 companies worldwide, you’ve got only one distribution channel . . . right here in New York City.

If your distribution channels are limited, then obviously you can’t market your show in the same way.

In this Sunday’s Arts & Leisure section of the New York Times, there was a full page ad for The Little Mermaid on Broadway.

And, of course, just a few pages away, there were full page advertisements for films like American Gangster.

Which one is a better value?

A New York Times reader in New Mexico can’t see Mermaid, but most likely he can see Gangster.

Yet both full page ads cost about the same amount of money.  Doesn’t seem fair does it?  Mermaid’s potential customers are severely diminished because of its one distribution channel. 

Billboards pose the same problem.

There is a giant Young Frankenstein billboard in Times Square. There is also a billboard for Target.

The impression that the Target billboard makes on the tourist can be converted the following week when the tourist is back home.  Or when the tourist is visiting another city two weeks later. 

The impression that the Young Frankenstein billboard makes can only be converted within 5 blocks of that billboard.  Once he or she goes back home, the impression becomes so much less valuable.

90% of shows can’t afford the same sort of subtle branding that most other products can afford. Our advertising has to be a much stronger call to action.

So what do we do?  Use your advertising to sell, not just brand (that is, until you have 15 companies worldwide and can split the advertising costs among them).

Or more significantly, perhaps we should stop throwing money at giant media companies like the NY Times who refuse to recognize that we are different than Tide, Avril Lavigne and American Gangster, and therefore should have appropriate pricing scales.

When it comes to advertising, pay for your potential.  Don’t pay for someone else’s. And yes, Avril Lavigne is on my iPhone. 

8 shows a what?

Does anyone know where the 8 show a week model came from?

Is it arbitrary?  Is it based on The Beatles song?  Was there any business analysis done on the actual demand for theatrical performances at the time?

My gut says that someone just picked it.  It somehow made sense at that moment, which was probably at least 50 years ago.

And thus, all of our agreements with labor unions, with landlords, etc., were based on this archaic idea that the demand for all shows, regardless of their cast or their subject matter, is the same.

So Mamma Mia does eight shows a week and so does Macbeth

That’s like Barnes and Noble stocking the same number of copies of the latest installment of Harry Potter as a Hungarian cookbook.

Smarter industries have more of a throttle on demand.  There are more flights by an airline during the holidays (and the prices go up).  There are less waiters and cooks on staff at a restaurant during a Tuesday lunch hour.

Wouldn’t it be great to find a way to break this model?  For so many shows (especially Off-Broadway), there isn’t the demand for 8 shows, but since we have to pay for them, we all do them.  And, we end up chasing our advertising tails, by spending huge bucks trying to fill the additional shows, when we could save money if we had fewer shows to fill.

And the fewer shows would be better sold, creating a harder to get ticket, which would actually increase demand as well as increase the experience for that audience (an audience of 500 is never as good as an audience of 1000).

I can hear the naysayers now:  “Ken, but there are people that want to see a show on Tuesday night, so you should capture whatever you can.”  Are you really telling me that if 2 people wanted to come to see Altar Boyz on a Tuesday, that they wouldn’t come on a Thursday if the Tuesday wasn’t available?

Two of my shows do less than 8 shows a week.  It’s a challenge to make it work with the venues, my staffs, etc. but I’m very lucky to have wonderful forward-thinking partners that make it possible. 

Yep, it’s definitely a challenge.  But I’d have a much greater challenge if they weren’t running at all.

Ken Davenport
Ken Davenport

Tony Award-Winning Broadway Producer

I'm on a mission to help 5000 shows get produced by 2025.

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