Earned income comes from a myriad of sources for theatres in the United States. However, there are some distinct differences between resident, nonprofit theatres and Broadway-based Commercial theatres.
Read p. 6 - 11 on TCG's Theatre Facts 2010 to get a sense of where the industry is and how it is moving forward specifically to earned income. (feel free to read pp 1 - 5 to get the executive summary overview) http://www.tcg.org/tools/facts/
Here are some stats for Broadway: http://www.variety.com/article/VR1118052118 , http://www.variety.com/article/VR1118048205
http://www.broadwayleague.com/index.php?url_identifier=research-and-informationn
Very different reports/industries, yes?
How do nonprofit theatres generate earned income? What are the differences between these lines of income and a Broadway Theatre or a movie theatre? Why do those differences exist?
Are there items theatres might be able to sell (or things you would like to buy) that have yet to be offered?
Nicki -- this is your week to jam! Have fun!
Hello all,
ReplyDeleteI’m the blog leader this week. Excited? You should be!
After reading through the reports for Broadway and TCG, it is clear that for-profit and nonprofit organizations share some similarities and differences when it comes to earning money. To start off I am going to list some of the information on earned income I read in the reports and articles.
It seems that while Broadway was more focused on the box office grosses, nonprofit focuses on box office income (single ticket and subscriptions) and contributions.
The TCG report also lists tour contracts/presenting fees, educational/outreach programs, royalties, concessions, advertising and rentals as additional sources of income for nonprofit theatre organizations. Backstage tours, walking tours, education events before plays, park talks and lectures, cabaret performances and other late-night short musicals and plays was also mentioned as other ways theaters can earn extra income. It seems that Broadway and commercial theatre can also benefit from these same strategies.
From my understanding, nonprofit has a lot of flexibility with generating earned income since they usually have their own employees that can plan and implement new ideas. But that is my own opinion.
I look forward to reading everyone’s responses and I will try to reply to most of them!
Nonprofit theatre has various means of generating income not just by trying to get people in theatre seats but also by outreach programs such as education , rentals, advertising, ect. Though ticket income brings in the most income, investment income such as endowment earnings and other incomes help the theatre to stay afloat. When “Broadway bookkeepers often pay more attention to seasons -- the Tony-eligibility window that tends to begin and end in late April or early May -- rather than calendar years” (Cox) they are determining when is the best time to make money off of not just audiences but also tourists when it is not too cold any more but not to hot. Non-profit seasons last longer because they are more intent on creating theatre rather than making the profit. They have the endowments to help fund them as well as various other outlets such as the education programs (which is always good publicity and advertising) and rental programs (if they have their own theatres and can be either good or bad publicity deciding on how the experience of the one renting it goes).
ReplyDeleteBroadway and movie theatre’s exist solely to earn a profit while non-profit theatre’s are tailored to whatever mission they have established for themselves in their mission statement. Non-profits try to stay afloat. They don’t give money to a board, rather they use it to pay employees and then set it aside for next year.
I apologize if I went a little off track here, I am just trying to connect some dots. By the way, I believe one of the links is broken (the one to broadwayleague). I could not open it.
Yes I noticed the above link was broken as well. I think this is the link that is supposed to be there: http://www.broadwayleague.com/index.php?url_identifier=research-and-information-1
DeleteI also agree with your statement of nonprofits generating income through outreach. Although I know commercial theatre can have outreach programs as well, nonprofit is solely focused on outreach because they are try to accomplish a specific mission within the local community.
This has to be one of the most enthusiastic blogs to date! I love it!
ReplyDeleteAlthough both Broadway and nonprofit theatres produce the same type of artistic performances in order generate an earned income, they operate in completely different ways, and earn this income differently. For a nonprofit theatre, their main source of income comes from a few different areas. These area include, but are not limited to, ticket sales, merch, subscriptions, and patronage. Nonprofits also rely heavily on education in the community. Tghrough classes, workshops, and other events, income can be gained.
As for the income generated through Broadway shows, the money comes mostly from ticket sales and merchandise. Some Broadway shows, as mentioned by Nicki, can also benefit from some of the strategies used in nonprofit. For instance, Wicked offers a backstage tour (Behind the Emerald Curtain) which allows theatergoers to go backstage and get the "full Wicked experience" and delve into the complex infrastructure that is the show and the Gershwin Theatre.
Yes, the Wicked backstage tour came to mind while I was writing my post. Although I do not know if they charge patrons for this tour, as I recall it being a part of the pre-show lottery prize a while ago. Still, Broadway shows charging for backstage tours is another opportunity to generate income from audience members. This is a great strategy not only because of the potential profit, but because it is a great way to engage the audience and theatre fans into learning more about what goes on behind the scenes during one of their favorite shows.
DeleteLong story short, money or no money, it is a great audience engagement tactic.
Just looked it up. It looks like they charge individual patrons $35 for the BEC tour, and probably have a special package for group sales. What a great way to earn money and make the fans happy!
DeleteAnyone interested in finding out more about this tour, here is the link: http://www.emeraldcurtain.com/
Great research and comment on the backstage pass model. Some theatres also do 'tours' during the day (eg Santa Fe Opera and Oregon Shakespeare Festival) that cost around $25 / person . . . does require a big operation and an open minded staff (as public gawks at their work)
DeleteI agree with everyone on this one. There are several similarities as far as how they earn their money, such as ticket sales and merchandise. However, what makes them different can also go back to what a for-profit and non-profit is (you can look at the previous blogs).
ReplyDeleteLike Nicki mentioned for-profit focuses more on the actual box office gross.They want to know what time of the year tickets will sale the most. Whereas, non-profit earns most of their money through other things other than ticket sales. Since they work with the community outreach programs can be a form of income and other educational programs connected to the theatre.
How do nonprofit theatres generate earned income?
ReplyDeleteNon profit theatres have a few different ways of earing income. Nonprofit theatre is best know for generating income from ticket sales but they also earn income through activities, including providing health care and educational programs, operating retail stores, performing plays and concerts, and offering training workshops and consulting services.
What are the differences between these lines of income and a Broadway Theatre or a movie theatre?
Broadway and Movie theatre pretty much get their earnings from from ticket sales, contributions and selling products from their stores wherea as nonprofit have more variety of ways of earning income.
Why do those differences exist?
The difference exit because Nonprofit and Broadway theares are run in a completely different way. Their mission statements are different (their reasons for theatre are totattly different, therefore their earned income will be different).
Hawa,
DeleteI am a little confused by your entry? For profit / Broadway theatres can never receive contributions? And I am confused on how a Nonprofit theatre offers health care, per se? Could you elaborate?
Thanks,
Brett
In reviewing TCG's Theatre Facts 2010 to get a sense of where the industry is and how it is moving forward specifically to earned income, I can honestly say that woking in development in a non-profit organization both large and small, generating revenue is crucial. Non-profits generally rely on ticket sales and subscriptions, individual giving, major gifts/endowments, corporate/foundations. Yet there are some important things to consider. When non-profits rely heavily on the government funding are given a smaller piece of the pie, they can often be left scrambling having to make up for lost revenue. Ticket sales generally cover half of the organizations revue and so contributions, and earned revenue through rentals and educational programs is quite important. Fewer and fewer individuals are purchasing subscriptions ( which was a real guarantee of income) and moving toward single ticket buying because of the flexibility. Individual giving remains a strong source of revenue for organizations all around but in order to generate income, organizations have to become more open and savvy to new ways of reaching audiences. In my current position with a community arts organization, I am responsible for generating revenue through rentals. I had an annual goal of $200,000 and in six months I surpassed my goal. The article mentioned that rental review had increased and I can see firsthand why this is happening. the organization the tI work for has 58,000 sq ft of space. Individuals, groups, agencies, organizations and the like are looking for affordable space for productions, concerts, workshops, tours, etc and we have it. Our government funding has decreased dramatically and the rental revenue alone is responsible for 50% of the entire budget. We also generate income through our educational performing/visual arts programming/classes and are seeing an increase from community looking for affordable classes. Granted we are a small organization and we are non-profit so our goal is to uphold our mission. However, without income there is no sustainability. So the bottom line in both nonprofit and for-profit is very important. Both models have to be financially fit in order to fulfill its mission.
ReplyDeleteEven though both types of theatre are produced similar, income is generated differently in each setting. Nonprofits base their income on the community and education also by the number of tickets the sell at each performance. They also produce workshops and fundraisers to money. Broadway shows solely base there money on merchandise and ticket sales.
ReplyDelete