Just our Imagination, Running Away with Us
4/13/17
The last time we checked, the laws of supply and demand were not repealed on Broadway, but sometimes we act is if they were. Take a trip with us and imagine a scenario…
The problem with this imagined—but very real—scenario is that we continue to price tickets high where we have the most potential customers: at the top of the funnel. Those inquirers, who show interest but don’t see a price that works for them, are lost.
In the graphic below, one can easily see how higher-priced Orchestra seats end up going to TKTS at a steep discount more often than all price/seating levels combined.
So, what would have happened if the show were right-priced (with different price points for different budgets) on Telecharge from the beginning, where the funnel is widest? One can only imagine…
Learn more about The Shubert Organization at www.shubert.nyc.
- Telecharge is the place where the sales funnel is the widest. Of all the places where people can shop for Broadway tickets, there will be a high number of “inquirers”—people who are just shopping around.
- But this show starts by setting its price points high on Telecharge, with little variation, expecting that they may have to discount later.
- As a result, the conversion rate for this new show is low, because the inquirers aren’t finding the right price for them.
- So the show gets aggressive on discount sites, where there are fewer casual inquirers and more people actually ready to buy. That’s good, but now the show is competing with other low prices in that discount environment.
- The show starts to move some discounted tickets, but at a low price. In order to move more inventory, the show decides it’s off to the TKTS booth at 50% of the original price. TKTS moves some more tickets, but the yields are not optimized.
The problem with this imagined—but very real—scenario is that we continue to price tickets high where we have the most potential customers: at the top of the funnel. Those inquirers, who show interest but don’t see a price that works for them, are lost.
In the graphic below, one can easily see how higher-priced Orchestra seats end up going to TKTS at a steep discount more often than all price/seating levels combined.
So, what would have happened if the show were right-priced (with different price points for different budgets) on Telecharge from the beginning, where the funnel is widest? One can only imagine…
Learn more about The Shubert Organization at www.shubert.nyc.
Originally published in Broadway Briefing.