Measure Success Using Revenue Per Seat
The name of this site is Selling Out, but the goal of Selling Out is achieving success with your marketing.
So how do you measure success? You can sell out by having a great show; or you can sell out by putting a show in a house that’s way too small for the act; or you can sell out by dramatically underpricing the tickets.
If there’s one thing I wish I could teach the world of live entertainment marketers about pricing, it’s this:
Measure success using Revenue Per Seat (RPS).
RPS is simple math, actually. Take all the dollars (or pounds, or euros, or drachma) you’ve made from a show/game/whatever and DIVIDE it by the number of seats (or admissions) you COULD HAVE sold.
For example, if you have $10,000 in revenue, and your show is in a 500-seat venue, your RPS is …
$20. (That is, for every seat you could have sold, you made $20.)
Note that you don’t even need to know how many tickets you sold to calculate this.
How do you measure success? If a program makes your RPS go up, it’s good. If it doesn’t, it’s not working.
How is it different from Average Ticket Price? Let’s do an example:
If you’ve got that 500-seat venue, and you sell 200 tickets at $50, you’ve got $10,000 in revenue and an average ticket price of $50.
But what about all those unsold seats? Aren’t they telling you something along the lines of, “Hey, live entertainment marketing person, you could have sold a whole lot more tickets!” For that matter, if all you care about is Average Ticket Price, why not just sell one really expensive ticket to a crazy rich guy for $300 and call it a day?
You’d know instinctively not to do that, but in more realistic scenarios, you might actually choose to make your RPS WORSE in an attempt to make your Average Ticket Price better. Average ticket prices mean basically nothing and can be deceiving.
A much better measurement is Revenue Per Seat, because it tells you what you’re making not just on seats you’ve sold, but on the whole house.
Give it a try. Measure the RPS on your current event, and see how it feels. If you have any questions about how to do it, just let me know. I’m happy to help.