Performing arts seats going for a premium

Posted Dec. 22, 2008, at 9:48 p.m.

PORTLAND, Maine — Just like airlines, many performing arts venues are beginning to charge more for ticket-holders to stretch out their legs.

The idea of charging a premium for desirable seats, as Northwest and U.S. Airways do for aisle and exit-row seats, is catching on with symphonies, ballets, operas and theater companies trying to get greater bang for the buck from ticket sales.

And consumers lining up to buy tickets to “The Nutcracker,” “A Christmas Carol” and holiday concerts this month may as well get used to it.

“Demand pricing” is on its way to becoming a best practice by performing arts organizations, said Alice Kornhauser, marketing director of the Portland Symphony Orchestra, which wrapped up its popular “Magic of Christmas” holiday concerts last weekend.

“If people are willing to pay more for an aisle seat, then it’s pretty irresponsible from a business standpoint not to charge,” Kornhauser said.

Pricing strategies are especially important this time of the year: holiday productions typically account for up to 50 percent of annual ticket sales for symphonies, ballets, operas and theater companies, said Joanne Steller from Target Resource Group.

Colorado-based TRG, which advises nonprofit arts organizations, is working with the Portland Symphony Orchestra and about 50 other organizations using the principles of demand management.

The results can be dramatic.

The Boston Ballet, for example, saw a $160,000 increase in revenues for its “Nutcracker” last year, largely from demand-based price adjustments; in New York, Alvin Ailey American Dance Theater used a variety of demand management principles to boost revenues by $1.9 million over the past two years, TRG says.

“It should not be a surprise that arts organizations use sound business principles to have a more substantial financial foundation,” Steller said. After all, other businesses including airlines and hotels have based their pricing on demand for years, she said.

Arts organizations, for their part, have practiced some form of demand pricing, typically by charging more for the most popular performances.

Thus, certain performances may be discounted, while others are not. The obvious example is the matinee performance, which is traditionally discounted.

These days, the principles of demand management increasingly apply to rate structures for seating. In the arts community, it’s known as “scaling the house.”

In New York, Jujamcyn Theatres, owner of five theaters on Broadway, began charging up to $25 per ticket for limited pairs of aisle seats over the summer. Jujamcyn could not be reached for comment.

In older, cramped theaters, in particular, theatergoers may be willing to pay more for extra knee room, or the ability to slip away without crawling over others.

In Portland, symphony officials studied seating charts at 1,900-seat Merrill Auditorium. After analyzing historical buying patterns, the symphony this year began charging more for popular seats while keeping the same spread of prices from high to low, Kornhauser said.

Pricing is not always based on the best view of the stage.

For example, some concertgoers who sat far in the back, getting a value seat while enjoying the hall’s best acoustics, are now paying more. And, of course, some aisle seats now command a premium price. Other aisle seats are priced the same as before.

Also, symphony officials discovered that the kid-friendly matinees are actually most popular. Thus, the discounts don’t apply to those performances.

The pricing formula means someone paying $55 for an aisle seat may be seated next to someone who paid $40. And someone seated at the matinee performance may pay more than someone at the evening performance. But there’s a method to the madness, Kornhauser said.

“Part of marketing is geeking out on numbers and percentages and things like that,” said Kornhauser, who came to Portland a few years ago from New York’s Lincoln Center.

The Portland Symphony Orchestra is no different than other arts organizations.

It relies on its “Magic of Christmas” to drive ticket sales just as ballets from Maine to Hawaii count on Tchaikovsky’s “Nutcracker,” theater groups count on Dickens’ “A Christmas Carol,” and choruses, soloists and musicians perform Handel’s “Messiah.”

All told, the “Magic of Christmas” performances over two weekends account for a third of the symphony’s annual ticket sales of about $1.5 million, Kornhauser said. But even then, ticket sales don’t come close to covering the operating costs of the symphony.

Jack Riddle, who has bought tickets to the “Magic of Christmas” for more than two decades, said he didn’t notice the change in seating prices this year.

But he understands the forces behind it. He used to be president of the board of PORTopera and previously served on the Portland symphony’s board.

“I know what it’s like to be in the arts. If the opportunity is there to maximize income, you’ve got to do it. I mean, you’re obligated to do it.”

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