The Economics of A Tony Award

I've been thinking about this issue lately, since I am in grad school for finance and all. I found this article on the New York Times theater section website and thought it was a great description of the effects of a Tony on the box office. Enjoy!

‘Red’ and ‘Carnage’ Find New Life Well Beyond Broadway
By PATRICK HEALY

The Tony Award that can reliably boost ticket sales for Broadway shows is the award for best musical: An overwhelming number of theatergoers – about 90 percent – buy tickets to see musicals rather than plays, and a Tony helps folks differentiate among the productions in the running for their ticket money.

The Tony for best play, by contrast, is a coveted artistic honor, though it rarely makes a big difference at the box office. Take “Red,” the John Logan drama about the painter Mark Rothko that won the award for best play and five other Tonys last year. The production closed on Broadway two weeks after the Tony Awards ceremony, when its stars departed and after its producers had recouped their $2.25 million investment.

Where honors and acclaim can help a play is at American regional and touring theaters, where executives view Tony-winning plays as reliable seat-fillers. That helps explain why the No. 1 most produced play around the country for the 2011-12 season will be “Red” and the 2009 Tony winner for best play, Yasmina Reza’s “God of Carnage.” Each play is scheduled to have 23 productions at American theaters this season, according to data compiled from Theater Communications Group, an umbrella theater organization.

The other plays in the Top 10 are “In the Next Room, or the vibrator play,” by Sarah Ruhl, with 13 productions; “The 39 Steps,” adapted by Patrick Barlow from work by John Buchan and Alfred Hitchcock, with 11; “Time Stands Still,” by Donald Margulies, with 11; “Next Fall,” by Geoffrey Nauffts, with 11; “To Kill a Mockingbird,” adapted by Christopher Sergel from Harper Lee’s novel, with 8; “Race,” by David Mamet, with 7; “August: Osage County,” by Tracy Letts, with 7; and “Clybourne Park,” by Bruce Norris, with 7. (Theater Communications Group also said that the musical “Spring Awakening” will have 7 productions this season.)

Both “Red” and “God of Carnage” also hold appeal for regional theaters because of their relatively low production costs: “Red” has two characters and a single, spare set, while “Carnage” has four characters and a fancier, but still unitary set. Beyond its meditations on art, “Red” has also been a boon to graphic artists for theater companies who have put their own twists on marketing designs. And both plays have juicy roles that are catnip to actors. A production of “Red” that begins performances this month at Philadelphia Theater Company, for instance, stars Haley Joel Osment (an Academy Award nominee for “The Sixth Sense”) in the role of Ken, for which the actor Eddie Redmayne won a Tony Award for featured actor in a play last year.