Raising ticket income sustainably

At a recent webinar hosted by the Local Theatre Touring Alliance, with colleagues from other service providers, I was invited to offer a five-minute provocation in answer to the question “How can we significantly and sustainably raise revenue from ticket sales while retaining the size, diversity and trust of our audiences?”

Given five minutes, I defaulted to type. Why take five minutes to say one memorable thing when, by talking really fast, I can say five things instead?

1. Know where revenue truly comes from

It’s important to know who pays the bills. In particular, what we risk when making pricing decisions that affect different audience segments. For both venues and producers, some key ratios are – each year -what percentage of revenue comes from your most frequent bookers, and what percentage typically comes from new-to-file?

The recommendation is not, for example, that we should over- or underestimate the buying power of frequent ‘loyalists’ – only that the ratios are good figures to know.

Across the sector, the proportion of income derived from the top 20% of bookers varies enormously. Some theatres depend heavily on this group; others have broader bases.

2. Stay flexible – strategy should be dynamic, not fixed

Theatres are often asked to deliver on four- or five-year business plans when, at this time, flexibility can be far more valuable than certainty.

We’ve all heard of dynamic pricing, but equally important is the idea of a dynamic strategy. Theatres that treat their plans as playbooks rather than blueprints are more able to adapt and capitalise on opportunities when conditions shift.

Monitoring the right data is essential, and strategy benefits from being agile. Funders and boards need to both allow and adapt for flexibility.

3. Acknowledge the economic reality

Data from the Office for National Statistics show the top half of households by income account for over 80% of leisure spending. It follows then that discretionary spending power is heavily concentrated among middle- and-higher-income groups.

These groups, while affected by cost-of-living pressures, remain the most reliable source of leisure expenditure and the most able to commit in advance.

Early booking behaviour correlates with financial stability and the ability to plan ahead. By contrast, some from the global majority, student populations and lower-income households tend to book closer to performance dates – in the final week.

While taking due note of audiences with disposable income, it’s important to recognise that pricing models that set the highest prices nearest to the date of performance risk excluding audiences most valued for their diversity. Structures that maintain accessible pricing across the booking cycle, or that offer targeted schemes, help to preserve inclusivity while sustaining overall revenue.

4. Raise prices steadily, not suddenly

For the webinar, I contrasted two organisations. Both had raised their average prices by roughly 30% compared with pre-pandemic. One achieved this through small, regular changes over years, growing attendance in the process. The other implemented the same in a single year through inadequately supervised automated dynamic pricing resulting in reduced attendance, lower income and a more price-sensitive customer base.

Gradual, even constant, growth of the average price paid allows audiences to adjust expectations and protects long-term loyalty. Sharp movements, by contrast, can sometimes erode goodwill.

The context of programme is critical as to how quickly theatres are able to raise their average price paid. A season of blockbuster hits from well-known writers or leading actors is undeniably helpful. Otherwise, opportunities lie in multi-channel ticketing, dynamic pricing, re-scaling the house, premiums, adjusting discount drift, fees, the whole mix – not just tweaking up the top price.

5. Make better use of the period between booking and attendance

Booking tickets months in advance shouldn’t be the end of the conversation. The period between purchase and performance offers valuable opportunities to deepen engagement and grow income.

Many venues encourage pre-orders for drinks or programmes. But they could also explore modest upsells such as seat upgrades – there are mature products on the market to enable this. The key is to align the offer with lead time and audience profile: someone booking six months out responds differently from someone booking six days out.

Small, well-timed invitations to upgrade can make a meaningful difference to revenue and customer satisfaction alike.

No silver bullets – but a shift in emphasis

A ticket sale relies on both willingness and ability to pay. During the webinar, I didn’t quite reach the potentially ‘provocative’ part of my provocation, which is: if ever there were a time to consciously redirect some marketing, pricing, and experience resource to those with greater ability to pay, it’s now. For some organisations this isn’t contentious at all, but for others it’s deeply uncomfortable.

Particularly in the funded sector, where pressures on public investment are unlikely to ease, theatres that continue to embrace commercialism will be better placed as tougher times arrive. English National Opera’s decision to appoint a business leader to chair its trading subsidiary is a good example of preparing for a different funding landscape.

That doesn’t mean abandoning commitment to diversity or inclusion. It means recognising sustainability depends on a realistic understanding of where income can and cannot grow, and that resources are not limitless.

Perhaps the question “How can we significantly and sustainably raise revenue from ticket sales while retaining the size, diversity and trust of our audiences?” is missing a coda: “And will that be enough to secure the future of every theatre?”

The answer is uncertain. The future of local theatre depends as much on the configuration and ownership of venues and touring networks as on audience demand. It would not be surprising if the next decade brings more consolidation and collaboration. In that context, the very existence of a Local Theatre Touring Alliance feels important. Working together may, ultimately, be the most sustainable strategy of all.