Table Of ContentSTRATEGIC PRICING FOR
THE ARTS
With roughly half of all income for nonprofit arts organizations in the
United States coming from earned revenue rather than donations and state
funding, the issue of pricing is paramount to success in the arts industry, yet
pricing is not covered in any existing textbooks. How should prices differ
between ordinary and premium seating? How much of a discount in admis-
sion charges should be offered through membership or season subscription?
When does it make sense to partner with organizations to offer discounts?
Arts managers, whether working in the performing arts, museums, or festivals,
and whether in the commercial, nonprofit, or state sector, need to make informed
decisions on the prices they set. This accessible text provides the first concise,
practical, non-technical guide for setting prices in the arts industry.
Offering a practical introduction to pricing, this book is perfectly suited to
students studying arts management/administration as well as new managers
working in the creative and cultural industries.
Michael Rushton is Professor and Director of Arts Administration Programs
at Indiana University, USA.
This book is essential reading for anyone involved with Arts Management.
Michael Rushton provides the first comprehensive guide to setting prices in
the Arts markets – a toolkit of advice in understanding how to determine
ticket prices, discounts, and concessions.
Rachel Pownall, Associate Professor, Tilburg University, the Netherlands
With declining subscription rates and the growth of dynamic pricing in
ticket sales, arts organizations’ leaders urgently need a clear and systematic
approach to the art of price-setting. Rushton’s strategic guide is a superb and
indispensable resource.
Patricia Dewey, Associate Professor and Director, Arts and Administration Program,
University of Oregon, USA
This comprehensive yet straightforward portrayal of options for maximizing
revenue will allay any skeptic’s concerns that strategic pricing is elitist or a
threat to accessibility and patron relations. Implementing effective pricing
techniques will increase engagement, participation and revenue. It is a prac-
tice long overdue across the arts sector.
Dan J. Martin, Professor, Carnegie Mellon University, USA
STRATEGIC PRICING
FOR THE ARTS
Michael Rushton
First published 2015
by Routledge
2 Park Square, Milton Park, Abingdon, Oxon OX14 4RN
and by Routledge
711 Third Avenue, New York, NY 10017
Routledge is an imprint of the Taylor & Francis Group, an informa business
© 2015 Michael Rushton
The right of Michael Rushton to be identified as author of this work has
been asserted by him in accordance with sections 77 and 78 of the Copyright,
Designs and Patents Act 1988.
All rights reserved. No part of this book may be reprinted or reproduced or
utilised in any form or by any electronic, mechanical, or other means, now
known or hereafter invented, including photocopying and recording, or in any
information storage or retrieval system, without permission in writing from the
publishers.
Trademark notice: Product or corporate names may be trademarks or registered
trademarks, and are used only for identification and explanation without intent
to infringe.
British Library Cataloguing in Publication Data
A catalogue record for this book is available from the British Library
Library of Congress Cataloging in Publication Data
Rushton, Michael, 1959–
Strategic pricing for the arts / Michael Rushton.—First [edition].
pages cm
Includes bibliographical references and index.
1. Arts—Marketing. 2. Pricing. I. Title.
NX634.R87 2014
700.68′1—dc23
2014002023
ISBN: 978-0-415-71366-5 (hbk)
ISBN: 978-0-415-71367-2 (pbk)
ISBN: 978-1-315-88314-4 (ebk)
Typeset in Bembo
by Book Now Ltd, London
CONTENTS
List of illustrations vii
Acknowledgments ix
1 Introduction 1
2 Preliminaries 7
3 Setting a single price 23
4 Segmenting the market 35
5 Two-part pricing 47
6 Pricing quality 57
7 Pricing quantity 67
8 Tied sales 77
9 Dynamic pricing 83
10 Pricing for mission 91
Bibliography 101
Index 105
This page intentionally left blank
ILLUSTRATIONS
Figures
1.1 Demand curve for a symphony concert 3
2.1 A consumer’s marginal benefit from eggs 16
2.2 Demand curve for a symphony concert 17
2.3 Consumer and producer surplus 21
Tables
3.1 Demand for bowls from Paul’s shop 25
3.2 Demand for concert tickets 29
4.1 Demand for concert tickets 37
4.2 Strong side of the market 38
4.3 Weak side of the market 39
5.1 Linus’s willingness to pay for one more ride 49
This page intentionally left blank
ACKNOWLEDGMENTS
I wish to give thanks to family and friends who have given such support and
encouragement in the writing of this book. I also thank the arts managers in
the field who were generous with their time in discussing how they go about
setting prices in their organizations. I am grateful to Douglas McLennan for
giving me the chance to air ideas and opinions on arts pricing through my
blog, hosted by his invaluable website ArtsJournal.com. My thanks also go
to Terry Clague and Sinead Waldron at Routledge for their assistance and
patience as I prepared the manuscript, and on the editorial side to Richard
Cook and Andrea Platts for making this short book a much better read.
Thanks also to Ashley Dillon for preparing the figures.
At Indiana University, I have had the good fortune to teach outstanding
future arts leaders in our program in Arts Administration, and I am thankful
to have had the chance to engage with them on the topics covered in this
book, especially so for those who said, in the end, “this subject was a lot more
interesting than I thought it would be!” Also at IU, I cannot thank enough
Megan Starnes, whose tireless work for the Arts Administration program
allowed me the opportunity to write this book.
