The Opera is partly a status indicator and a networking opportunity. Lowering the prices would drive off the donors. I get the feeling that for a vast majority of people the Opera is seen as a Richie Rich event off limits to them.
The problem with San Francisco Opera ticket prices
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Re: The problem with San Francisco Opera ticket prices
#12The fact that arbitrage is happening is obviously bad for the Opera, but I want to point out that every opera ticket is sold at a loss. Selling opera tickets just at break-even would drive down attendance significantly (and it's already low). Opera companies run like VCs: most of the audience/startups are losses, but a few of them are donors/unicorns who keep the opera/VC afloat.
> at break-even would drive down attendance significantly (and it's already low). But there's an arbitrage from reselling, so clearly retail prices can be raised without hurting attendance significantly?
That would only be true if the opera always sold out and lots of people couldn't get seats. If every person that wants to go to the opera is able to do so, the fact that some of them are paying higher amounts doesn't mean everyone should. If the ticket prices raised to the amount the brokers charge, then a lot of the people who are buying direct might just stop attending at all.
Re: The problem with San Francisco Opera ticket prices
#13The Opera is partly a status indicator and a networking opportunity. Lowering the prices would drive off the donors. I get the feeling that for a vast majority of people the Opera is seen as a Richie Rich event off limits to them.
Some of us actually _like_ the Opera.
Re: The problem with San Francisco Opera ticket prices
#14The fact that arbitrage is happening is obviously bad for the Opera, but I want to point out that every opera ticket is sold at a loss. Selling opera tickets just at break-even would drive down attendance significantly (and it's already low). Opera companies run like VCs: most of the audience/startups are losses, but a few of them are donors/unicorns who keep the opera/VC afloat.
> at break-even would drive down attendance significantly (and it's already low). But there's an arbitrage from reselling, so clearly retail prices can be raised without hurting attendance significantly?
Right, but that money might be better spent other ways—for instance, by selling them twice as many tickets, in the hopes of retaining more audience members, some of whom may one day become high-rolling donors.
Re: The problem with San Francisco Opera ticket prices
#15Is changing the pricing scheme the only solution here? Maybe part of the opera's goal is to appeal to a broader range of demographics, or any other reason they aren't trying to maximize profits. It would be nice if they could make a good living for themselves and still keep tickets affordable for everyone. There must be a way to maintain a discrepancy between what people are willing to pay and what people have to pay, where the opera can meet their non-monetary goals while reducing this third party arbitrage.
Re: The problem with San Francisco Opera ticket prices
#16Earlier quoted context omitted.
> at break-even would drive down attendance significantly (and it's already low). But there's an arbitrage from reselling, so clearly retail prices can be raised without hurting attendance significantly?
That would only be true if the opera always sold out and lots of people couldn't get seats. If every person that wants to go to the opera is able to do so, the fact that some of them are paying higher amounts doesn't mean everyone should. If the ticket prices raised to the amount the brokers charge, then a lot of the people who are buying direct might just stop attending at all.
I'm somewhat distantly familiar with a British opera company. The usual rule is to do one or two mainstream bums-on-seats shows which are more or less guaranteed to be successful, and then fill in with less standard repertoire around the edges.
So sell out shows do happen, at more or less standard prices that are surprisingly affordable, and much less than big name pop artists charge for their tickets. But the sell out shows are more or less at capacity. There certainly aren't thousands of people willing to pay five times as much for a seat.
And in fact there is absolutely no way that income from ticket sales would be enough to keep the company running.
The rest of the money comes from sponsors and from Arts Council funding. Getting money from both is a highly skilled full-time job.
This company happens to be very good at fundraising, which is why they still exist. (Actually they're very good at everything, not least the artistic side.)
Would on-demand pricing work? Absolutely not. The audience is older and fairly faithful, and they tend to feel they have a personal relationship of sorts with the company.
Variable on-demand ticket pricing would completely destroy that relationship, and I would be hugely surprised if it didn't also make sponsors feel like less like contributing.
Re: The problem with San Francisco Opera ticket prices
#17There was an interesting NPR episode on ticket resellers a while back: Planet Money (episode 468 - Kid Rock vs The Scalpers) http://www.npr.org/sections/money/2013/06/25/195641030/episo... They talked about how it's more complex then resellers charging mark-ups to meet market demand. Often, venues have either social pressure or pressure from artists to keep prices low. The idea is that if the venue sells Katy Perry t…
You forgot to mention the one weird trick that Kid Rock uses to help keep ticket prices for his shows lower -- he plays a lot of shows.
Re: The problem with San Francisco Opera ticket prices
#18There was an interesting NPR episode on ticket resellers a while back: Planet Money (episode 468 - Kid Rock vs The Scalpers) http://www.npr.org/sections/money/2013/06/25/195641030/episo... They talked about how it's more complex then resellers charging mark-ups to meet market demand. Often, venues have either social pressure or pressure from artists to keep prices low. The idea is that if the venue sells Katy Perry t…
You forgot to mention the one weird trick that Kid Rock uses to help keep ticket prices for his shows lower -- he plays a lot of shows.
The second trick is being Kid Rock.
Re: The problem with San Francisco Opera ticket prices
#19It seems like the article is missing a possible situation (which I believe is likely). Suppose
-The ticket price is the market price and a raise would drive away a lot of buyers
-A small portion of buyers do not do the full ticket research and are happy with $265 tickets.
Their conclusion that "Demand and Supply is out of balance" seems to assume that each buyer is the same and has some probability of buying at a given price. Instead, there are a few people who buy at the bigger price without thinking. The fact that these people exist does not mean that raising the price won't decrease the number of buyers.
Re: The problem with San Francisco Opera ticket prices
#20Arbitrage is never shady.
Sure, the seller might feel upset that they lost out on a slice of the profit, but that doesn't imply that the reseller is in the wrong.