The Show Goes On: The Resurgence of Broadway in the Modern Era
Entertainment, Media

The Show Goes On: The Resurgence of Broadway in the Modern Era

Upoma Dutta, Contributor

Upoma Dutta (MBA ’21) talks with Raphael Roesler (MBA ’18) about what’s next for the industry.

“I’m past patiently waitin’. I’m passionately smashin’ every expectation. Every action’s an act of creation! I’m laughin’ in the face of casualties and sorrow. For the first time, I’m thinkin’ past tomorrow.”

— Lyrics from Hamilton: An American Musical

In a world of declining attendance at sports events and movie theaters, the Broadway industry has fared remarkably well: the industry registered an annual growth rate in the range of high-single-digit to low-double-digit percentages in five of the last six seasons, per data from The Broadway League, the industry trade association. In the 2018–2019 season alone, Broadway shows cumulatively grossed over $1.8 billion, up 10% year-on-year, and drew roughly 15 million in attendance, up 7% year-on-year.

“The Broadway industry is undergoing a period of innovation and redefinition—expanding its audience base beyond musical theater aficionados and New York City tourists, embracing new pricing strategies and economic models, and experimenting with disruptive forces to extend shows’ economic lives even further after their Broadway run,” according to Raphael Roesler (MBA ’18), Global Strategy Manager for Music Theatre International (MTI), one of the leading theatrical licensing agencies in the world. In this role, Roesler has been able to blend his passion for performing arts (he co-produced The Cabaret under the HBS Show umbrella during his time at HBS) with commerce, helping shows be performed around the world after their initial Broadway runs, benefitting authors and audience members alike.

Long-running Broadway musicals, such as The Phantom of the Opera, Chicago, and The Lion King, historically banked on the significant flow of tourists—domestic and international—to New York City. Indeed, tourists currently purchase over 60% of the tickets to Broadway shows, and they tend to gravitate towards musicals instead of non-musical plays. Recently, there has been a modest decline in their share, as well as a decline in the average age of the Broadway audience.

“These pivots illustrate some tremendously exciting aspects of Broadway. Edgier shows, from Frozen to Hamilton, that resonate with a younger audience are solidifying the next generation of theatergoers. Additional growth in ticket sales has been driven by the casting of A-List celebrities into Broadway shows—typically plays—and the adaptation of popular movies into shows—typically musicals,” Roesler notes.

A peek at the list of nominations for last year’s Tony Awards, for instance, reveals popular stars, such as Bryan Cranston (Network) and Adam Driver (Burn This), with already huge fan bases, and beloved movie titles, such as Beetlejuice and Tootsie.

“No single element of a Broadway show can guarantee critical or financial success, but a show headlined by an A-Lister or adapted from a big-name movie definitely starts with an in-built edge. The popularity of the brands is hugely important in the initial marketing stage, before the ticket-purchaser has heard a single note of a song,” Roesler adds.

However, there is one area where critical acclaim is indispensable: (non-musical) straight plays. Many Broadway productions fail to be financially viable, and for serious plays without star or title power, critical success is, well, critical.

“Unlike London’s West End, where several plays have enjoyed multi-year runs in recent years, Broadway has traditionally counted musicals among its biggest commercial successes,” Roesler explains.

But New York City locals are becoming more interested in attending straight plays that critics praise. “Although Broadway is expanding the audience base for plays, it is interesting to note that many of these titles, such as War Horse, The Curious Incident of the Dog in the Night-Time, and The Ferryman, are London imports. Many of the limited-run Broadway plays—those intended to run for a short period only, often around 16 weeks—often still rely on star power, materially helping to boost their visibility.”

In many cases, achieving commercial viability for a Broadway show comes down to finding the perfect balance between occupancy (what proportion of seats are filled) and ticket price. While popular musicals may sell out with healthy ticket prices, other shows work hard to strike a balance between discounting (intended to boost occupancy) and profitability. This is where investments to execute dynamic pricing (i.e., changing the price of a seat based on the most recent available information on sales trends) have paid off for the most popular Broadway shows as well as those that need a sales boost to remain open.

But at over $100, the average ticket price on Broadway remains high; dynamic pricing is making Broadway even less affordable for a significant share of the audience, especially those in the younger age brackets. The highly anticipated Moulin Rouge! The Musical, for instance, turned heads when it debuted on Broadway last month, charging up to $499 for premium seats, though regular seats under $100 are available.

“For most shows, producers offer lottery, standing room, and/or deeply discounted rush tickets to provide an opportunity to attend to all. This is particularly important for college students and young professionals,” Roesler says. “While these ticket types tend to be priced in the region of $40 to $50, Hamilton offers a lottery which yields tickets priced at $10.”

Even with these opportunities, a sizable segment of the potential Broadway audience is priced out of the market. Can Broadway shows become more accessible without hurting their financial viability?

Streaming might provide a partial solution. Bruce Springsteen’s solo concert and Broadway debut Springsteen on Broadway had no trouble selling out every seat in the house, even at an average ticket price of over $500, throughout its 14-month run. But then Springsteen’s team made an unconventional move: a Broadway performance was filmed and released as a Netflix special after the show ended its run on Broadway.

Roesler also points to BroadwayHD, an online streaming service (costing $9 per month) that provides live recordings of a selection of shows that also concluded their run on Broadway. These strides could be a harbinger for the increasingly important role that streaming might play in helping shows earn ancillary revenue after their Broadway run, while simultaneously expanding their audience base.

As for Roesler, he is excited by the opportunities presented by streaming and globalization. “If you look at the theater industry of, say, Seoul, Hamburg, or Buenos Aires, you should find a healthy proportion of shows that have previously played on Broadway and have been staged in a new production in the local language but that retain the excitement and storytelling of the original show. These shows are often playing to packed houses.

“To me, these facts signify a real opportunity in the ever-expanding global interest in Broadway: I fully expect that creatives will continue to find new and exciting ways to produce Broadway-style entertainment on and off the stage, and that as an industry, we have barely scratched the surface.”


Upoma Dutta (MBA ’21) came to HBS after spending roughly four years in the media and entertainment industry in New York, where she helped two media companies (HBO and Disney) transition into the streaming era and build on new strategic growth opportunities. Originally from Bangladesh, she also worked for the International Finance Corporation (World Bank Group) early on her career to promote financial inclusion and financial sector stability in South Asia. She holds a bachelor’s degree in business administration from The Institute of Business Administration, University of Dhaka.

September 11, 2019
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