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Box offices escaping worst of economic downturn
Sunday, October 26, 2008

You'd think entertainment would be among the first casualties of household budgets during tough economic times, and, indeed the current financial crisis has slowed activity at the box office.

But it hasn't stopped it.

So far, local arts organizations say, the chill up and down Wall Street hasn't nipped sales for popular acts and shows: A hot ticket remains a hot ticket. And when gasoline prices rise, it often fuels interest in finding entertainment options closer to home.

Here and in other cities across the country, presenters continue to have hope while bracing for the worst. Some are weathering the storm by trying new incentives to fill seats -- marketing to younger audiences, discounting tickets, or offering extras during performances, like social gatherings before or after a show.

Even at the epicenter of the entertainment industry, tightening credit is making it more challenging to fund a show. Independent Broadway producer Stewart Lane predicts that 2009 will be dominated by revivals and big brands ("Shrek: The Musical," for instance).

Nationally, attendance at live performances has been lagging, even before the recent economic woes hit. Attendance at nonprofit theaters showed a 6 percent drop from 2003 to 2007, according to the Theatre Communications Group.

The average nonprofit performing arts group depends on the box office for most of its income: Ticket sales and other earned income account for half of their revenues, according to the service and lobbying group Americans for the Arts. The rest comes from individual donors and endowments (35 percent), federal, state and local government support (7 percent), foundations (5 percent) and corporations (2.5 percent).

Locally, arts organizations big and small are experiencing the financial crisis of 2008 in different ways:

• In the Downtown Cultural District, ticket sales and donations are holding steady, says Pittsburgh Cultural Trust president and Chief Executive Officer Kevin McMahon. "We hope they continue to come in at the level they are."

Advance sales for shows like the national touring company of the "Jersey Boys," the Tony-winning musical that opens in January at the Benedum Center, are good, because people don't want to miss out on a show that could sell out quickly. Ticket sales for the Broadway Series overall are up over last year, and several programs in the current Pittsburgh International Festival of Firsts sold out.

At the same time, Mr. McMahon said, the organization can't afford not to be concerned about Wall Street's woes.

"It's difficult to predict" what will happen, he said, noting that the coming weeks and months may provide a clearer picture of how long-term the crisis really is. "We're just as concerned as any other organization, large or small, because our margins are just as tiny as anyone's."

However, Mr. McMahon believes the Trust's wide variety of offerings, with some at low ticket prices, will help sustain the momentum, even when disposable income is short. "The fact that we have so many different programs provides the opportunity for people at all levels to continue to participate."

• The Carnegie Museums of Pittsburgh have had a good year, with attendance and membership both up, thanks in part to a succession of highly anticipated exhibitions like the Carnegie International at the Carnegie Museum of Art and the traveling "Bodies: The Exhibition" and "Titanic: The Artifact Exhibition" at the Carnegie Science Center.

President and CEO David Hillenbrand prioritized putting the financial house in order upon his arrival in 2005 and feels as confident about the organization's future as anyone can be in this roller-coaster financial climate. Some strategies had begun to use before the recent downturn, such as collaborating with like institutions on traveling exhibitions and co-purchasing high-end, high-ticket artworks and sharing their costs and custody with other museums. Plans for an ambitious 2009 are continuing as originally envisioned.

Pittsburgh Symphony Orchestra subscriptions were up slightly for the fourth year in a row, and the organization's capital campaign has raised nearly $50 million of its $80 million goal. "The campaign has been going well," said the orchestra's president, Larry Tamburri, "but we are in unusual economic times. As things stabilize we will see what the next step is."

Unlike many similar organizations, the Pittsburgh Symphony has a substantial endowment. But when the market's down, even a healthy endowment potentially has a lot to lose.

"What has happened in the stock market certainly affects our endowment and our pension funding," said Richard P. Simmons, chairman of the PSO board. "We can't do anything about that but manage effectively and continue to work to having a world class orchestra here. We are going to have to revisit the strategic plan and adjust it as necessary."

• Ticket sales "are about flat" for the River City Brass Band from last year, said music director Denis Colwell. "The numbers are sobering. You figure for growth. You hope for 2 [percent] to 4 percent growth from last year.

"The economy absolutely affects where people will spend disposable income," Mr. Colwell said. While RCBB has a $1.8 million endowment, it relies heavily on ticket sales, with 60-65 percent of the budget based on earned revenue.

As such, Mr. Colwell said, the RCBB's benchmark for success is filling the auditorium seats. "When the economy takes a hit like this, it becomes a challenge."

• On the concert scene, audiences are being more selective and not taking as many chances, says Brian Drusky of Drusky Entertainment, an independent promoter who books bands at the Carnegie Library in Homestead, Club Zoo and Altar Bar.

"If it is a bigger 'must see' show, people are going to go. The shows that are hurting are the marginal acts, the ones that are touring to survive, whether they are a younger, newer band, or an older band that had a lot of hits and are on the decline But your big 'must see' shows, if the prices are right, will still do fine."

• Last weekend, the Mattress Factory held an art auction that's served as a primary fund-raiser for the installation museum on the North Side. Every five years, artists who have shown work at the museum donate works to be sold. This year pieces came from high-profile artists such as James Turrell and Kiki Smith, filmmaker John Waters and more than 100 other national and local artists.

The auction was the first to be conducted online as well as live at the Mattress Factory, so bidding was open to a global audience. It raised nearly $80,000 -- the most it has raised through its auctions to date, and 8 percent higher than last year. "Art is a safe place to put your money," says Mattress Factory marketing director Jeffrey Inscho.

The city's larger stages are feeling the pinch, but are trying to find ways to weather uncertain times.

Pittsburgh Public Theater director of marketing Lou Castelli says ticket sales trends are hard to predict. "I think people are shopping later. They've been on the fence."

Subscription sales were slow over the summer but have rebounded in recent months. "I think people were weighing their options and biding their time. [Subscriptions] were down a bit, but we're playing catch-up nicely and I think we're going to end well.

"Fund-raising may be less predictable, but from past experience of economic challenges, I think [the fund-raisers] know how to roll with that."

• At City Theatre, ticket sales are "on par with how we performed last year," said managing director Greg Quinlan. " In the last several years we've grown slightly. We'll be happy if we hit the same subscription levels this year."

Pittsburgh CLO's summer sales were lower than expected, said CLO general manager Jim Mercer.

As for the future, it's too early to tell, he said: The CLO just opened a new cabaret show -- "I Love You, You're Perfect, Now Change" -- and has just started ticket sales for "A Musical Christmas Carol" and subscription renewals for next summer's season.

"However, as we planned the [next] summer season we were certainly aware and are programming a season we think will be strong in terms of sales," Mr. Mercer said.

"We always try to develop new sources of revenue, both in Pittsburgh and outside Pittsburgh," such as the company's set rental business. "So our funding is balanced. Everything we do out there brings artistic and financial resources back to the summer season."

• But some of the region's smaller theaters are suffering the ripple effects of the economy's problems. Apple Hill Playhouse executive producer Pat Beyer sums up the situation there in two words: "It's bad."

Attendance at the Delmont theater is down 50 percent compared to last year at this time, with the same kinds of plays in the same slots. Subscriptions are a tougher sell, because people don't want to commit their entertainment dollars on a long-term basis, she says. And sales of Apple Hill's dinner theater packages with the nearby Lamplighter Restaurant have declined, too.

"We don't count on funding. We earn our money. It's the everyman who doesn't have money to spend, and they're not."

• At South Park Conservatory Theater, attendance at the last show of the season, which closed last weekend, was down year to year around 25 percent.

But South Park executive director Kathleen Caliendo doesn't know whether to blame it on the economy. "Things are busier in the fall. A lot of our patrons have families," so there's sports and school activities competing for their leisure time. "I think the economy is probably a part of it, but I attribute it to other things as well."

Although the theater does have some corporate sponsors, ticket sales are its largest revenue stream. "Because there is a decrease [in ticket sales], it's making us work harder to look to corporations and foundations for additional funding," Ms. Caliendo said.

• There's some good news among Western Pennsylvania's small theater groups. At Little Lake Theater in Canonsburg, attendance this season has been "very solid," says artistic director Sunny Disney Fitchett. "I think it has to do with people staying close to home and looking for things to do in the area. People just aren't traveling far from home.

"During hard economic times, sometimes attendance at movies has gone up. People are absolutely looking for an escape right now. People need a laugh."

Andrew Druckenbrod, Scott Mervis, Christopher Rawson and Mary Thomas contributed to this story. Adrian McCoy can be reached at amccoy@post-gazette.com or 412-263-1865.
First published on October 26, 2008 at 12:00 am