How much of an economic impact did Broadway make in 2008-2009?

For 15 years, The Broadway League has been measuring our industry’s impact on the NYC economy.

This year, the League changed up how these figures were calculated (much like how the League changed the publishing of our grosses and attendance a year ago).  Previously, the impact only counted money spent by those people who came to NYC “primarily to see a Broadway show, or extended a trip made for another purpose in order to go to a Broadway show.” The reason for the change was to account for the incredible increase in out-of-town visitors (especially the international crowd).  In the 1980-81 season, 69% of our audience was from outside of NYC.  In the 2008-09 season, this figure was up to 81%.

So, to get a more accurate reading, the League now asks visitors to rate Broadway’s importance in their decision to come to NYC on a scale of 1 to 10, and then counts the 8s and above as a “Broadway Tourist” and studies their spending habits.

This more quantitative approach produced a much higher, and I’d argue more accurate, account of what the economic effects of our industry really are to this city.

The results of this year’s report?

In the 2008-2009 season, Broadway’s economic impact was approx $9.8 b-b-b-billion dollars.

To quote the Executive Summary of the report:

“This amount was comprised of direct spending in three areas: spending by producers to mount and run shows ($2 billion); spending by theatre owners to maintain and renovate venues ($51 million); and ancillary purchases by non-NYC residents who said that Broadway was an important reason in their coming to New York City ($7.7 billion) (“Broadway Tourists”).

Those are some serious bucks, don’t you think?

What’s more interesting to me than Broadway Tourist spending is that Producers alone are directly responsible for initiating over 20% of this impact, spending over $2 billion on the production of shows.

Shouldn’t the city, the restaurant industry, the Taxi and Limo Commission, the hotel industry, and so forth, be tripping over themselves to help us with promotions, marketing, tax incentives, and so forth to inspire us to produce more?

To read the release from The League, and to learn how to get a hard copy of the report, click here.

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(Not So) Favorite Quotes Vol. XXIV: Won’t you be my neighbor?

One of the couples on my floor loves the theater.  They go on a regular basis, have great taste, and are always asking me for recommendations on shows to see.

Oh, and get this . . . they always pay full price.  (insert “whoopee!” here)

Last week, I ran into them in the elevator and they told me they were on their way to see Red.  I started asking them my usual string of mini focus group questions:  how they heard about Red, if they could describe the artwork, and then I landed on my finale of, “Where do you go to get your tickets?”

Their answer was Telecharge . . . but then the husband’s eyes widened and I could tell he wanted to share some sort of secret.  Here’s what he said:

“Yep.  We buy on Telecharge.  And pay full price.  But we never buy in advance.”

My heart sunk . . . and I kind of wanted them to move to another building.

He continued:

“Yeah.  We find we get better seats when we buy last minute. Whenever we try to get something in advance, we always get crap. But if we go online the day before or even the day of, we usually find gold.”

When I heard this, I wanted to move . . . to Tallahassee. There’s something wrong with a ticketing purchase process that reinforces full-price buyers to wait until pulling the trigger.

So what’s the problem?

There are probably a few issues at work here, but I’d bet a couple of full-price tickets to Red that the issue most at work is that theaters and shows are holding too many of their best locations for House Seats, etc.  House Seats (or quality locations held for use by the Producers, Theatre Owners, Actors, Designers, etc.) that are not used get dumped back into the general pool of available seats 2-3 days before each performance, which is why there is sometimes a flood of good seats available closer to the performance.  My neighbor was probably getting the tickets held for the Set Designer, or one of the Principal Actors, etc.

The problem is . . . there are so many people that have House Seats in their contracts, that up to 75 prime orchestra seats can be held . . . for every performance.  I mean, is the Set Designer or Principal Actor really going to use 2 or 4 seats every night???

In survey after survey, our audiences tell us that the #1 thing that they want is a great seat . . . and we’re holding them back.

By serving our own selfish needs, we’re causing our customers to do one of three things:

– Not buy at all (there’s really no better seat than on your own couch).

– Wait until something better opens up, thereby decreasing our ability to build advances.

– Find better locations elsewhere . . . translation:  they are going to brokers.

That last one is the most ironic.  Everyone in our biz has been concerned about the huge amount of business going to third party ticket brokers.

Well . . . news flash:  we’re part of the reason our audiences are seeking them out.

We’ve got to find a way to give our customers as much access to the best seats possible.  And one of those ways is to decrease the number of house seats we all hold.

Then, after we’ve decreased the number of house seats . . . we can start charging for them.  (For more on house seats, click that link)

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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