Archive for Donmar

The reality of pricing theatre tickets

Posted in Theatre, Ticketing with tags , , , on September 4, 2012 by richardhowle

Making the headlines yesterday was the announcement of the new season at the Donmar Warehouse and the introduction of a new ticketing initiative.

Concerned that the Donmar’s reputation for being always sold out meant that people wouldn’t even try to book tickets and the effect that that was having on audience development, they have devised a scheme whereby tickets will be made available at £10 for every performance.

Not a new concept, the upcoming Grandage season at the Noel Coward theatre made headlines recently with a similar pricing initiative. The difference at the Donmar is that those tickets will only be made available for sale two weeks before the performance, thus helping to quell the myth that it is impossible to get a ticket at the Donmar without booking months in advance.

It is a great initiative that helps kill two birds with one stone, (of course it is much easier for the subsidised and small Donmar to do this than it is for other venues) and they should be applauded for making the hard decisions and being innovative.

This does, however, cause a problem for the commercial sector, because by offering tickets at £10 it establishes a market price that it is completely unsustainable. For the theatre going public that don’t distinguish between the subsidised and commercial sectors it misleads them into thinking that all venues / productions should be priced similarly and that those that aren’t are profiteering. But look at the Grandage season, I hear you cry, that is a commercial venture offering £10 tickets – but that was a classic case of smoke and mirrors. The cheap price that stole all the headlines allowed them to post some of the highest ticket prices for plays in the West End virtually unnoticed.

Producing commercial theatre is an expensive business, the hiring of the theatre, the cost of cast, production staff, equipment hire, licensing, royalties, advertising and marketing all add up. The amount of money it costs just to open the doors each week can be staggering – before you even begin to recoup the cost of mounting the production, let alone making a profit .

Let’s think about the maths.

A top musical in the West End can have weekly running costs of around £250,000 (yes a quarter of a million pounds a week, just to break even). Let’s imagine it is playing in a 1,500 seat theatre at 70% capacity (this is the average across all SOLT theatres over a year). That means the production is selling 8,400 seats per week. Divide the running costs by the number of tickets sold and you can see that, in order to break even, the production has to sell each ticket at an average net ticket price of £29.76 each. And remember that is a net price. Adding in VAT and the various ticketing and credit card charges produces a gross average price to the public of nearly £40. Just to break even.

It is disingenuous when commentators deride theatre producers for being greedy, for cynically squeezing out future audiences by expensive pricing, because all the producers I know and work with spend a lot of time agonising over ticket prices and ensuring that they are affordable. Don’t get me wrong I am not suggesting that they are all altruistic (although many are), they are working in a commercial world and want to price their product to sell.

Which is why for an average musical you will find 30-40% of tickets priced at below a break even price. There is a real recognition of the expense of theatre tickets, the need to make their product attractive and the need to not price themselves out of the market.

In addition there are group rates, school rates, senior rates, day seats etc – many of which are priced at below break even price – but are done so to make the show more accessible to a wider audience.

The flip side to this is that in order to subsidise these lower rates the top prices are expensive and unfortunately it is these prices that grab the headlines.

Top class commercial theatre is expensive to produce, but it doesn’t have to be expensive to watch, the discerning theatre goer can sit in great seats at reasonable prices for any production
if they can be flexible about when they go or if they can gather a few friends to make up a group.

It is brilliant that the Donmar have done what they have done, I think that producing high quality drama and presenting it at accessible pricing is exactly what subsidised theatre should be doing. But let’s remember that in the commercial world, theatre producers have to play by a totally different set of rules.