Will the World Cup Be Good News for Broadway?

The first World Cup game at New York New Jersey Stadium will take place this Saturday. With the first matches already underway. FIFA released last year a total positive economic impact projection for this year's World Cup of $30 billion across the US, and as high as $1.7 billion in added direct spending due to the World Cup in New York and New Jersey alone. With Broadway’s continued financial struggles, could the World Cup be a silver bullet to remedy it? 

The answer? Maybe. There is evidence to suggest that FIFA’s confidence was significantly overstated. Last month, a report from the American Hotel and Lodging Association reported that across the country hotel owners were feeling the pressure, with bookings lagging significantly behind initial projections. In New York City, most hotel owners have reported demand consistent with other summers, nearly 60% below those initial projections. Hotel prices during the World Cup, though they have fallen significantly from their peak, are still more than double than dates outside of the World Cup. It appears hotels are still charging a premium for rooms during the World Cup, though without any real increase in demand. The average international traveler to the World cup intends to spend over $5000 according to a US Travel report, nearly twice the average. Over a third of tourists as well are planning to spend two weeks or more in the country. Certainly that leaves plenty of room to see a Broadway show or two. 

As well, Broadway prices are incredibly cheap by comparison to World Cup ticket prices. Last week 13 shows had average ticket prices less than the cost of a round trip train from Penn Station to the Meadowlands, let alone the astronomical costs of attending World Cup games, with tickets for the final starting at $4,000 face value, with resale tickets being nearly 20x that figure. Even tickets to group stage matches in New York start at over $500 at this point, significantly more than the $137 ticket average the Broadway League reported international costumers spent on tickets. 

As well, on average, over 60% percent of world cup attendees are men. Comparatively, only 30% of Broadway ticket buyers identify as male, according to the Broadway League Demographics report. Economic factors aside, there may not be significant enough demographic overlap 

Domestically, while consumer spending has held relatively steady, financial confidence moving forward has decreased 12%, and over two-thirds of Americans believe a recession is on the horizon, according to a recent study by Ernest and Young. EY Americas Retail Sector Leader Will Auchincloss said “Consumers are actively reallocating their budgets as cost pressures, especially transportation, force sharper trade-offs across discretionary categories like entertainment, restaurants and travel.” 

In other words, consumers are planning on spending less this summer. Last season, a summer slump was already felt with fewer international visitors than the year before. The increase in international travel may be offset by a decrease domestic travel, the opposite trend from last summer, which saw an increase in domestic tourism and a decrease internationally.

With lower international tourism overall thanks to policy changes and geopolitical pressures, If it takes the World Cup to bring Broadway back to their norm, 

The end of June is typically end of the peak of the Broadway season anyways, the period following the Tony Awards when everyone is attempting to see the winning shows. It’s the beginning of July when shows begin to see slumps. Summer is typically peak domestic tourism season, as most American schools and colleges are on break, with International tourism peaking in the fall. Hotel prices peaking 

Regardless, a recent Goldman Sachs analysis of previous World Cup host countries found that the long term economic impact was essentially zero. Broadway’s financial troubles are more systemic than a one month event can solve, even assuming the maximum positive impact from that event, unlikely as that may be. But any potential positive impact would certainly be welcome.