The Price of Art: Strong emotions and cheap concerts
Today I am going to speak about the price of concerts. Once I was playing a concert and afterwards there was get together with the fans. At that time I was particularly interested in finding out the keywords for my webpage – so I wanted to know what words people would enter into google when searching for concerts to go to. You can imagine my surprise when one lady said: classical concert and cheap. I would find all sorts of words for google, but never the word cheap as I would perceive it as a negative one in this context.
But if we think about the concert goers, how does the concert consumption look like? In a free market economy the price is set by a free consent of sellers and buyers, there is a rule of supply and demand. Buyers have a maximum price they are willing to pay and sellers have a minimum price they are willing to offer their product. The point at which the supply and demand curves meet is the equilibrium price. So it is an individual decision on the buyers side how much they are willing to pay and there are many factors like who is playing, what is the program, which location, do they have enough spare time for concert visits, what’s their budget, are friends or significant other is coming along, but most important is what are their expectations?
It makes sense: we are giving part of our income in the hope of getting something in return. Expectation is an important part of our decision making process. The best advertising in the world would not help when our best friend tells us it is not worth our money, or we read in the news that this musician played the same program in other town and it was no success. On the other hand, if you always wanted to hear live performance of a particular musician, then you are willing to pay more than the official price, in case the tickets are sold out, you would even buy it at the black market. So our expectations define the intrinsic value of the concert. Is it an amusement, source of inspiration, socializing, search for strong emotions? All of you have different reasons.
And how does it look like on the seller’s side: professional musicians earn their living by playing and concerts could be a bulky part of their income. Unfortunately the concert price does not consist only of the musician’s fees; it has location rent, infrastructure costs, administration and management costs including high marketing and advertising costs. The basic management course teaches you to sum up all your expenses and divide by the seat capacity of your location and then you get the ticket price,? But then you still presume that you get maximum capacity and… and the marketing pricing strategy teaches you to check the ticket prices of the similar concerts and then you would see that for example, the maximum ticket price for this location exceeds your calculated price, so it leaves you with a big gap in your budget. This brings us to the topic of sponsoring and subventions – I will be talking about it in the next blogs.
One more observation about the supply side, I do not need to show you the programs of concert halls to tell you that we have too much offer. The young and old musicians are playing along, you see Martha Argerith followed on a next day by a no name debut pianist, all nationalities – The most extreme example is Matthaus Passion concerts before Easter, I bet you can get 40 different concerts in Munich at different price and certainly different quality . As I said before, quality is very relative and depends on your expectation… And we are oversaturated! Youtube made all great works available in 2 seconds. In my opinion the demand is not proportional with the price. If you lower the price by 20 %, you might get 30 % more visitors. I think that in every city there is just a certain amount of concert goes. If you lower the price, for example, dramatically by 70 %, you may have only 10 % more visitors. In my opinion it is not the price that can attract more visitors to classical concert, but the only way to attract them is to offer additional value for the visitors.
Now my question to you is what is the price of classical music for you? It would be great to hear your comments at www.movingclassics.tv Thank you for watching me and good bye.