Revenue implications of celebrities on Broadway theatre

Live entertainment revenue management practices depend upon understanding the most salient drivers of shifts in demand. Motivated by the increasing usage of dynamic pricing on Broadway, we explore factors that impact revenue in live theatre. Based on a fixed effects model and a novel dataset of revenues and actor usage, we estimate the revenue impact that celebrity actors have on Broadway shows. We find that weeks that have a celebrity are associated with an increase in revenue of approximately $250 k. The two major acting awards—Tony and Academy (the Oscars)—were found to have a non-significant impact on weekly revenue. We discuss implications on Revenue Management practices.