Updates: The Business of Broadway – May 2017

Tony! Tony! Tony! Tonys!

Yup, it’s Tonys season! Any moment now, we will find out the nominees for the 71st Annual Tony Awards. This year’s host will be Kevin Spacey. We have some updates for Chapter 6 along with a map showing you where The Tonys matter the most in the U.S. Hint: It’s what you thought!

http://www.justlearnsomething.us/updates-the-business-of-broadway-may-2017/

 

What shows are you looking forward to seeing? Enter another question here!

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Updates: May 2017

May 1, 2017

**US states show interest in the Tony Awards.

Chapter 6 (Tony Awards):

The Tony Awards nominations will be announced Tuesday May 2nd at 8:30am leading to weeks of increased marketing for those who are nominated, and especially for those who are not. It’s fascinating to watch how press representatives manuever and manipulate the media.

Social media bumps happen the day after the Tony nominations are released. Those nominated for Best Musical or Musical Revival see a 90% increase in social media activity (compared to the day before). Musicals that do not receive a nomination get a 20% increase. There are still no solid statistics if social media brings in ticket sales. However, a Tony nomination will definitely help.

The other categories of nominations have little if any effect on ticket sales. And if you look at the attached map**, you will see that a very small portion of the country cares about the Tony Awards at all.

On the positive side, the Tony Awards brings the magic of great theater to the world and creates the mystique of Broadway for tourists visiting NYC. As already mentioned in the book, the cost of performing on the Tony Awards is not small. There are a lot of considerations for producers when deciding how to spend their promotional dollars.

 

** See attached map of which US states show interest in the Tony Awards.

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Updates: The Business of Broadway – April 2017

If you want to be a producer, Chapter 10 is for you. This month’s updates are all about producers!

Updates: April 2017

What shows are you looking forward to seeing? Enter another question here!

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Updates: April 2017

April 1, 2017

Chapter 10 (Producers):

“Dynamic Pricing” a ticket-pricing concept borrowed (?) from the airline industry, where prices are changed daily based on demand, is expanding its use in a downward direction. Hit shows now commonly raise their ticket prices for Spring Break, Christmas week, etc. when the demand is super high. This is done without fanfare and often without the awareness of the general public.

 

But what happens to shows that are not selling out? Or shows that can’t sell full-price tickets in certain sections of the orchestra or mezzanine because the public only want the best or the cheapest. “Dynamic Pricing” is now being considered as a way to reduce the prices of less-desirable seating locations on a moment’s notice, rather than losing the box office sale. For example, why pay full-price for a rear mezzanine seat when you can buy an orchestra seat for the same or lower price by standing on line at the TKTS half-price booth on the day of the show? Better seat at the same cost.  Reducing ‘unsellable’ seats at a “dynamic” discount keeps the public going to the box office and sells tickets in advance.

 

Of course, in older decades, shows had up to 9 different prices, regularly advertised, for seats: far sides, too close, too far back, etc. This may just be another way to do the same thing.

 

Chapter 10 (Producers): Wait…There’s more!

What’s the best time of year to open a new show? In the “crap-shoot” that is Broadway, there’s no way to be sure…EXCEPT: 2017 gives warning to producers about opening in a crowded field of new shows. New shows opening in the two months before the Tony Award deadline include: Groundhog Day, Amelia, Anastasia, Come From Away, Sweat, Glass Menagerie (Sally Field), Significant Other, War Paint (Patti Lupone), Charlie and the Chocolate Factory, Hello Dolly (Bette Midler), Oslo, The Play that Goes Wrong, Indecent, Bandstand, Six Degrees of Separation, and a few more! Is there enough audience to fill the seats at full price? Dear Evan Hansen and Natasha, Pierre and the Great Comet of 1812 have already established themselves as popular shows. They opened before the crunch. Major discounts abound for everything even if the houses look full. How many of these new shows will survive past July 4th? Less than two-thirds. How many of these shows will survive past Labor Day? Less than half? And most of them at discount prices. And that translates into a total loss for investors.

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Updates: March 2017

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March 1, 2017

Chapter 7 (Merchandising): Scalping tickets isn’t the only way to steal from a show’s box office. Disney was the first producer to earn more with merchandise sales than the box office during the early run of Beauty and the Beast. Since “merch” is part of the subsidiary rights potential windfall of each hit show, then “fake t-shirts” etc. can be a large pay-off for thieves who know that you need big legal bucks to find them and shut them down. First step is of course to trademark your brand and your images so that you have something to protect. (Another legal cost when you are setting up your corporate documents.) Hamilton, a show with inexhaustible funds, has found its trademark infringers and negotiated a settlement with them, which includes a policing strategy to find other smaller infringers. Broadway is not just about putting on a show.

Chapter 10 (Producers):

A new trend (?) may have emerged. Normally it takes years for a musical to break-even (recoup its capitalization to investors). This year, two musical revivals – Sunset Boulevard and Sunday in the Park with George – have set limited runs of around 16 weeks (presumably because their stars have limited availability) and are budgeted to return a small profit within that short period of time. If it works, this may be a new trend…or not. Open-ended shows have the potential of earning massive amounts of profits over many decades and are still a more likely risk for many investors.

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