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Archive for the ‘Pricing’ Category

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Greetings after a bit of a hiatus, and welcome to the 2014-2015 touring season!

Actually, the season pretty much started back in September, so we’re in the thick of it now!

But how did we get to this point? Hundreds of touring engagements will make their way across North America this season, as they do every season. What are the basic mechanics of the business that make that happen year after year? What’s the timeline?

Well, aren’t you glad you found The Road 101, because it is here where you’ll find out how that wholllle process works! A process that is a long, complex, ongoing cycle. There are many places I could begin, but for this post, I am going to begin discussing this cycle with the Tony Awards Nominations as a starting point, which typically take place at the end of April.

There are many types of shows that are out on The Road in a season and it is often a foregone conclusion that many of these will be back out there — the blockbuster, the second and third year tour, the non-Equity tour, the special attraction, and the smaller Off Broadway type show that has built its brand over many years, are just some examples.

Then, there are the new shows coming from Broadway in the current season. So, in this case, we’re talking the 2014-2015 Broadway season. These shows are the touring question marks. Which ones will make it out on The Road in 2016-2017? That’s right. Wrap your head around that for a second so you can follow along. The shows running on Broadway in 2014-2015 are being considered for touring in 2016-2017.

The Broadway 2014-2015 season is still evolving as I write this post, and booking agents (some already representing some of these shows) and presenters are watching closely which Broadway shows will make it through the season and rise to the top. When the Tony nominations come out in April 2015, that is a moment when certain shows could get a key boost, especially those shows nominated for Best Musical. Though agents and presenters are seeing shows throughout the entire season, it is typically during Tony Awards season when many in the industry check out Broadway to see which are most likely to end up being viable touring properties. A lot of this theatre-going happens during the annual Spring Road Conference, which typically takes place between the Tony nominations and the Tony Awards. Now, winning a Tony Award this season does not necessarily guarantee that a show will go out on tour for the 2016-2017 season. There are many factors that a producer and a general manager need to take into consideration before deciding if their show is viable enough for a tour:

  1. Did the show make it through Tony season in good shape both from an awards standpoint and a box office standpoint?
  2. Did the show make a good impression on enough presenters?
  3. Can the show offer a deal that presenters can work with?

Okay, so, the 2015 Tony Awards have happened and we are now in summer 2015. The blockbusters, second year tours and non-Equity tours are largely routed and slotted in for the 2016-2017 touring season. The booking agents are also more clear at this point regarding which of the new 2014-2015 Broadway shows they represent will likely make it out on The Road in 2016-2017, and which will fall by the wayside. The final part of the 2016-2017 touring season programming process is now in full swing as booking agents and presenters work through final deals and tour routing. Again, these interactions happen throughout the year, but it is during the summer and into the early fall where all programming MUST be finalized.

Why must programming be finalized by fall 2015? Because it is at this point that presenters need to then begin figuring out how they want these shows to be priced. It is important to be thoughtful about all the details that go into pricing and to consider all data and history available to maximize profit. If an engagement is not priced and discounted correctly at the outset, there is the chance that the engagement could lose money, or, conversely, it may make money, but if it was underpriced and over-discounted at the outset there is a chance of “leaving money on the table,” meaning even more money could have been made. The opportunity to maximize profit is then further exploited via dynamic pricing.

So, once the presenter decides on the pricing for a show, which includes prices for singles, subscribers and groups, the presenter then sends this pricing to the show’s booking agent for consideration, which oftentimes ends up turning into a back and forth negotiation. Again, multiply this step by many, many engagements that need to go through this detailed process. For a large company like Broadway Across America with numerous markets, the ticket pricing process takes several months to complete. During the pricing process, things move fast and timing is everything, as prices need to be agreed to by the show and the presenter and locked in quickly so the marketing teams can then get to work on creating the brochures, which will include these prices and discounts, and which need to go into the mail to subscribers by certain established deadlines.

The time is now winter of 2015-2016. The 2016-2017 pricing process is beginning to wind down as we move into March. The booking agents and presenters are making any final little programming and deal tweaks to the 2016-2017 season while at the same time are also in the process of booking the 2017-2018 touring season. Meanwhile, as all this is happening, don’t forget, the 2015-2016 engagements are currently out on the road on tour requiring constant management through the end of their tours in May or June, each engagement culminating in its own final bravo – settlement.

And now, it’s Tony Awards season again. Which brings us back to where we started.

Pfew. Did you follow all that? Yeah, I’m still learning to wrap my head around it, too, and I WORK in the business!

In the end, this is just a broad overview of how the booking and pricing cycle works as I have come to understand it. It is likely that others in the industry would have other details to add, but this should give you a pretty good sense of the general timing of it all.

If you have questions, feel free to email me anytime at robin@theroad101.com. If I don’t get back to you immediately, please forgive me. I’m probably swamped in pricing for 2015-2016.

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Another Broadway Across America Theatrical Conference ended its short, but sweet run this past Thursday night in warm (thank goodness!) and wonderful Key West, FL. This year’s conference ran from February 10-13 on the theme of “catching waves and driving change,” the aquatically inspired metaphor being that not unlike that of a surfer, theatre industry professionals must continually “experience, create and innovate” by taking risks to keep up with changing times, while also maintaining a sense of balance and tradition.

For those of you not familiar, BAA’s biennial theatre conference is where all the top presenters, producers, general managers, booking agents, and ticketing and technology experts associated with the commercial theatre industry converge for several days for panels, creative presentations, business, networking and some fun. Well…er…a lot of fun.

To kick things off, popular humorist, Mo Rocca and acclaimed director, Jack O’Brien delivered charming and meaningful keynote addresses, with Rocca describing various theatre memories from his childhood, and O’Brien instructing those on the business side of the theatre to “play” more. He reminded attendees that gathering in Key West in this relaxed and fun way was important, because despite having become very much a business, theatre has been, and always will be, first and foremost about play.

With regard to the panels, the overarching takeaway for me was about how ticket sales are “riding the wave of technology” with trends showing that more and more people are purchasing tickets through their smart phones and tablets. In order to capture those sales more effectively, the industry is reaching out to experts in digital for support, and, in some cases, bringing digital experts on to their own staffs. A small sampling of the ticketing and digital leaders who spoke on this topic included David Andrews, SVP, Shubert Ticketing, Damian Bazadona, Founder, Situation Interactive, Stan Deak, VP New Business Development, Experience, which is based in an app that allows you to upgrade your seat, or add on an experience right from your mobile device, and Julia Vander Ploeg, GM & SVP, Ticketmaster Resale, who discussed the new TM+ website.

Cast members of GETTIN' THE BAND BACK TOGETHER perform at the BAA Theatrical Conference in Key West.

Cast members of GETTIN’ THE BAND BACK TOGETHER perform at the BAA Theatrical Conference in Key West.

But the conference went way beyond panels! There were also a number of special performances, as well as exciting creative presentations of both new and established works! These included Cyndi Lauper (KINKY BOOTS), Sheryl Crow (DINER), and the lovely Jessie Mueller performed songs from the hit Broadway show, BEAUTIFUL. I was particularly enamored by the presentation of AMELIE, and will be rooting for the show as it continues in its development and journey toward Broadway. Other shows represented at the conference were GETTIN’ THE BAND BACK TOGETHER, WE FOXES, THE HEART OF ROBIN HOOD, MOTOWN THE MUSICAL and DIRTY DANCING.

The energy at the conference was inspiring, and by the close it was clear that The Road has never been stronger. It’s heartening to know how alive and well theatre remains despite all the various entertainment choices out there. And I truly believe that The Road, by bringing theatre beyond New York, Chicago and other major cities, directly and indirectly helps theatre at every level thrive all across the country. By maintaining and building new audiences, fans and supporters on The Road, theatre remains highly visible, as well as culturally and economically relevant. And no matter how technologically advanced this world gets, at the end of the day there will never be anything that could ever duplicate the kind of magical experience that only live theatre can offer.

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Closing night fireworks on the beach of the Casa Marina Hotel, Key West.

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I’m writing this post from my mobile phone. I’ve never done this before, so apologies in advance for any typos or weird formatting!

Day 2 of the Spring Road Conference has been a full day of diverse panels and creative conversations that began at 8am. Below is a small sampling of just a few of today’s discussions…

EVOLUTION OF THE ROAD

In this panel, a group of presenters, producers and booking agents discussed general observations, as well as some of the economic challenges involved in commercial theatre touring from their varying perspectives. Here is an overview…

– In the course of laying out a tour presenters and producers feel there is room to improve with regard to balancing the strength of sub load-ins from one market to another. In other words, perhaps adjusting the deal for a show from market to market in relation to the size of the sub load-in is worth considering, as a larger sub load-in involves less risk compared to a sub load-in that is not as robust.

– Bookings are happening further and further in advance, allowing for more lead time.

– The success of family titles was seen as varying from city to city from one presenter’s standpoint. Certain cities will have more family programming over another and the popularity of family programming is not necessarily uniform across markets.

– The question of whether there is too much product out there was brought up, and how that might be affecting the success of an engagement, as well as the number of weeks competing tours are able to get as a result.

– Revenue Management: Dynamic Pricing, also called Demand Pricing, is becoming an increasingly popular and effective tool for presenters and producers to maximize revenue and the panel concurred that demand pricing has even much more potential. Demand pricing, when implemented effectively, in addition to increasing gross revenue also helps to offset show and venue related expenses that continue to increase year after year.

– On a universally positive note, the panel agreed that Broadway is becoming more mainstream. Songs are getting out there due in large part to the recent theatre reality shows, as well as TV shows (such as “Glee”) that have helped to educate a larger population about musical theatre.

– The panelists agreed it was wise to think more about seeing how to effectively harness the digital activity that goes on during Broadway runs and apply this momentum to touring shows. The first time theatre ticket buyers hear about a tour coming to their town should not be when they are being sold a ticket.

“HAVE SAFE TIX!”

This panel discussed the ongoing problems presenters have with ticket scalping websites that make themselves appear as though they are associated with the presenters and their theaters. Many presenters are trying to get state and federal legislation passed to combat these companies, as many patrons are buying their tickets from these sites thinking they are buying tickets from the actual theatre organization. These sites overcharge and also don’t provide customer support when something goes wrong. The theater then ends up holding the bag and dealing with angry, confused patrons who thought they bought their tickets from the theater. It seems presenters are fighting an uphill battle against the savvy scalpers, but they are indeed fighting hard, and have been finding better ways to educate their audiences about these sites.

CREATIVE CONVERSATION

We were super fortunate to have the leads of KINKY BOOTS along with Harvey Fierstein, Jerry Mitchell and Cyndi Lauper as a creative conversation. These conversations are fun, informal panels about the creative process and other behind the scene tidbits. This group had a wonderful chemistry, which is also apparent when you see the show!

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The most significant takeaway for me from this year’s conference is how much more digital the commercial theatre industry has become since I first started attending this conference six or seven years ago. Producers, presenters, and their teams are clearly beginning to embrace digital media and strategies to strengthen their marketing and ticket sales. Even the conference schedule was accessible via an app!

It’s both exciting (and a relief!) to see that the commercial theatre industry is starting to implement technology more assertively, and in creative ways. Using digital marketing and social media enables audience members to interact with the brand in a more direct and constant way, and also extends a sense of the live experience. This, combined with effectively reaching ticket buyers through all the various electronic devices we have now, and will continue to have, will help sustain the industry and make theatre remain a prominent entertainment choice for years to come.

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I brought up Dynamic Pricing in other posts. If you need some basic background on the subject, you can check those posts out here and here and here.

Dynamic Pricing will probably be the subject of more of my posts going forward, as more and more producers, performing arts organizations and arts presenters look towards this strategy to try and take as much advantage of their ticket inventory as possible.

If you are a member of Americans for the Arts, there is a FREE webinar on the topic this Monday, Feb 4th at 3:00p EST. For non-members, the cost is $35.00, but if you are not at all familiar with Dynamic Pricing, this webinar could be worth the money — money that you could ideally earn back down the road through Dynamic Pricing!  🙂

Here is a link to info on the webinar:

A Look at the Future of Dynamic Pricing

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DYNAMIC PRICING:  REVENUE MANAGEMENT STRATEGIES

On Thursday 5/17, the final day of the conference, two sessions were devoted to Dynamic Pricing. (For my previous post about Dynamic Pricing, please click here.)

A lot of information was disseminated by the various panelists on how they have navigated within the Dynamic Pricing model. Below is a list of bullet points that give an overview of the information that was imparted at these sessions:

  • Build different price levels horizontally rather than vertically to fill the orchestra and fronts of other sections to create an electric feeling. People behind these locations will see the energy in front of them, rather than seeing empty seats.
  • Look at pricing by performance, not just overall sales.
  • When you have distressed inventory, align with organizations that can sell these seats at full price to a “valued buyer.” There are companies with a target constituency that may have an easier time getting their consumers to buy the same tickets that you may have trouble moving.
  • Hold back seats to create demand if you know you will sell quickly.
  • Be conscious of the price/value equation. Create a sense of scarcity to spark interest and urgency.
  • Continually monitor and manage rezoning, revenue management and forecasting.
  • When implementing Dynamic Pricing, consider your messaging since prices will fluctuate, i.e. “Prices starting from…” or “Today’s price is…” or “Act now! Prices go up on Friday!” or “Prices are not guaranteed,” etc., so people know the price will change.
  • QUESTION: How can an organization keep up with the messaging, though, if you have limited resources within your advertising spend, and you also don’t want to upset potential customers by over communicating?
  1. ANSWER: Create a seat map that allows people to scroll over seats to see the different prices. “Pick your seats online.” (See Ahmanson Theatre)
  • Price aisle seats higher. People will be willing to buy adjacent seats at the same price when they buy the aisle seat.
  • Set a deadline for subscriber renewal. “Act by x date, otherwise the package goes up to y.”
  • Consider using the word “Adjusting” rather than “Discounting” when messaging that prices are being lowered.
  • Be careful lowering prices for people who already want to attend a performance. People who already don’t want to come probably still won’t want to…even at a lower price. “If people don’t want to come…you can’t stop them!”
  • For one-week markets, do surveys in advance to get a sense of the heat signature.
  • QUESTION: What are some successful strategies when middle-priced inventory isn’t moving?
  1. ANSWER: Raise deeply discounted mid-section seats back to full price, then reduce them and give the inventory to a company like Goldstar. The Goldstar consumer will feel like they’re getting a deal. i.e., they will be getting the full price $75 ticket for $49.
  2. ANSWER: Raise the PL3 price to the PL2 price to give the perception that it’s a hot ticket.
  3. ANSWER: If you have three price levels, for example, $45/$35/$25 and your $35 tickets are not moving, consider raising your $35 ticket to $45 at both peak and non-peak performances with the messaging, “a new block of $45 tickets on sale!”
  • Know your timeline so you are ready in advance to have higher pricing in place before your campaign hits.

Annnnd…this post concludes my coverage of some of the panels and a bit of the fun from the 2012 Spring Road Conference. I hope you found these posts useful, and that you continue to check back here at The Road 101 for more observations, updates, and articles related to the commercial theatre touring industry.

See you down The Road!

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Broadway Across America Theatrical Conference 2012 Key West, FL

I just arrived back from Broadway Across America’s biennial theatre industry conference. This conference has been around for many years and is where all the top industry professionals involved in producing and presenting from around North America and other continents converge in a warm and inviting setting in chilly January to see what hot projects Broadway Across America has cooking, as well as other producers.

The BAA conference is always jam-packed with lively and informative panels with top people in the field. A major theme this year related to technology and how emerging programs and platforms are beginning to support the theatre industry’s foray into dynamic pricing, and also how mobile and tablet devices will most definitely be key in driving more sales and excitement around shows.

Also at the conference were entertaining glimpses of several productions that are currently in development or on the boards, and which you will likely see on Broadway, and potentially on the Road sometime in the next several years. These creative presentations included highlights from GHOST, HANDS ON A HARDBODY, FLASHDANCE, LEAP OF FAITH and ONCE, among others.

Despite the still shaky economy, the mood at the conference was bright and the outlook for the industry extremely positive. There was a great deal of excitement about the creative presentations and a warm sense of community amongst the attendees throughout the magical 3-day gathering. I was reminded once again of how fortunate I am to be in such a special field that is unlike any other.

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Little by little, Presenters are beginning to adopt “dynamic pricing.” Dynamic pricing allows ticket prices to be fluid based on supply and demand. These days, most theaters still have set ticket prices. If you hypothetically buy an orchestra ticket today for MILLION DOLLAR QUARTET in Pittsburgh, and your friend goes up to the box office during the engagement and buys the seat next to yours the day after the show receives some great press that causes increased demand, the price she pays for her ticket will still be the same as what you paid. In the dynamic pricing scenario, if the great press causes an increase in good word of mouth and a hot demand for tickets, your friend would have to pay more for that same ticket.

And you would have gotten a bargain.

The main challenge with regard to dynamic pricing, though, as I understand it, is getting a handle on the Gross Potential. With fixed ticket prices, you can easily calculate a GP, but with dynamic pricing, since prices could go up or down, and you don’t know if sales will be slack or robust, it seems impossible to accurately determine the maximum gross that can be achieved on an engagement.

Here is a Los Angeles Times article from a few months ago that talks about dynamic pricing and how presenters are considering it more and more to encourage people to buy tickets early, and as a potential tool to build their subscription bases.

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