Trends in Ticket Pricing
by Steven Wolff

It is conventional wisdom in the arts and culture sector that ticket prices are determined based on "a sense" of what the market will bear as opposed to a clear understanding of market value and price elasticity.

For the past several years, AMS has been tracking ticket pricing at major U.S. performing arts centers and the data (see chart which follows) reveal several interesting facts.

1. For the period from FY 2004 through FY 2007, ticket prices in some centers ranged from a low of just over $30 to a high of $48.50. While recognizing that many factors affect ticket pricing — most especially program mix, our analysis showed that prices were more closely correlated to the overall budget of the performing arts center than to actual programming expense.
2. Over the past four years, the greatest increase in ticket prices was seen between fiscal 2006 and 2007 when prices gained 8.6% on average. This confirms anecdotes that suggest that ticket prices increase in "stair steps" every couple of years.
3. Compared to data available from Pollstar, arts and cultural events are priced, on average, at approximately 70% of the cost of a typical concert ticket.
4. For the first time since we have been tracking this data, arts and cultural ticket prices increased at a faster rate over this 4-year period than concert tickets (18% vs. 16%)

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One thing that concert promoters have long known is that fans will pay significant prices to attend concerts by their favorite artists. It seems this concept has only recently been adopted in the arts and cultural space — with variable or demand based pricing, "Inner Circle" tickets and the like, a relatively new phenomenon.

In future issues of Insights, we will explore the success and challenges that arts and cultural organizations are having with variable pricing.