#TBT: Revenue Per Seat — A Refresher
Happy #TBT. To celebrate, we’re sharing an oldie-but-goodie post from Jim: Revenue Per Seat — A Refresher.
Revenue per seat is a metric that everyone in live entertainment should use, but most don’t. It measures not what your average price per ticket is, but what your average revenue per seat is (thus, the name).
Let me demonstrate the difference:
If you have a 100-seat venue and you sell 80 seats for $50, your “average price per ticket” (as calculated on Broadway by the Broadway League and elsewhere) is $50. By this logic, it’s actually irrelevant how big the venue is or how many tickets you’ve sold. If I sold just one ticket for $5,000, my “average price per ticket” would be $5,000. Got it?
Revenue per seat is a number that gives you more information, telling you how you’re doing in terms of the WHOLE house, not just the part you’ve sold. In this instance, you’ve done the following:
• Sold 80 tickets for $50 each, for a total revenue of $4,000
• And you have 100 seats, SO
• Revenue ($4,000) per seat (which you have 100 of) is $40.
Compare that to your “average price per ticket,” which was $50. You’ve been deceived by your “average price per ticket” because you didn’t take into account the fact that you didn’t sell 20% of the house. That’s not productive. It should be “penalized” at least in the way you think about it. After all, selling 100 seats at $50 is better than selling 80 seats at $50, right?
So, by calculating Revenue Per Seat (which is super easy), you’re getting more information about your overall marketing performance than if you use average price per ticket sold, which can be, and often is, deceiving.
To make this easy, I’ve created a widget (see below) that you can use to do scenarios on this very thing. It’s also super, duper easy to add a column to any excel spreadsheet to translate your averages (not so useful and potentially tricking you) into Revenue Per Seat (always useful and always telling the truth).
Watch for our posts each Tuesday and every other Friday where we calculate revenue per seat for Broadway shows (on Tuesdays) and concerts and shows, as ranked by Billboard (every other Friday).