Ticket Price Fixing on Broadway: Only Ticket Prices That The Shubert Organization Approves Are Allowed To Go On Sale on Broadway. But This May Change With The NY Governors Push For Competition
Only Ticket Prices that the Shubert Organization Approves Are Allowed On Broadway
The twice annual, 2 for 1 discount model during Broadway Week is the very lowest that the Shubert Organization will allow; it's an example of market protectionism or even business socialism, as the free market economy on Broadway ticket pricing is not allowed to develop.
Having said that, there are also restrictions on the upside price of tickets, but each year it appears that the base "high" price creeps ever higher. Broadway Week is the one time that market forces can get Broadway ticket prices lower than usual.
Broadway Price Fixing and Price Protectionism Case Study
Similar to the Broadway price fixing model, the "Market Protectionist" approach can be seen in other industries. The subject is often taught at business schools and the phenomenon has been justified in sorts of ways.
The one example of price fixing is the now-famous decision by the Champagne region in France, where they toyed with discounting their sparkling prestigious product as their costs were continuously being lowered by new technologies and the amount of product was exceeding their demand.
Case Study: 2 For 1 Pricing Deal on Champagne Nixed
Members of the Champagne conglomerate had proposed offering a 2-for-1 deal on bottles of Champagne, but the idea was nixed by the general membership of the association of Champagne growers. To further prop up the pricing of their product, the Champagne producers collectively agreed to pick 32% fewer grapes and reduce bottles produced by 44% in the wake of falling demand.
Of course, this doesn't mean that Broadway has falling demand, but it does show that the Shubert Organization and the Broadway League has a vested interest in keeping Broadway show prices on an even keel, with the 2 for 1 being the very lowest they would ever allow, even if they could go lower.