Sometimes in winter there's just WAY too much time to think. Fortunately Circus Report
sometimes needs to fills some space.
-- 2008 By The Numbers –
It’s January and in winterquarters whether in Sarasota, or Hugo, OK, in Missouri, or in California circus dreams the dreams of another year. In the lean months between seasons there’s more than enough to worry about, more than enough to keep anyone busy, and with luck at least a few dates far to the north and indoors beckoning over a thousand miles of icy highway. The winter is a numbers game wagering on the seasons that will follow. A time of concern and a time of hope. A reminder that in the circus business everything old becomes new again. What are the numbers for 2008? What are the reasonable expectations?
According to old time circus logic, quadrennial election years have been less than kind beneath the bigtop. Oh, they may start well enough, but come the conventions in summer public awareness fixates on the presidential race. There’s little more than anecdotal evidence supporting this nostrum, and we can all think of a few banner years coinciding with elections, but it’s certainly true that a Presidential race fixes the electorate on money issues and a less than rosy economy deflates consumer confidence and leads to worry. Unfortunately in ’08 those fears may be very real. The probability of downturn, looming four dollar a gallon diesel and gas, a poor jobs outlook, tight credit, the sub-prime mortgage fiasco and a free-fall in real estate values are more than enough to scare many Americans with or without an election. According to a report in the New York Times, “Strong evidence is emerging that consumer spending, a bulwark against recession over the last year even as energy prices surged and the housing market sputtered, has begun to slow sharply at every level of the American economy, from the working class to the wealthy. The abrupt pullback raises the possibility that the country may be experiencing a rare decline in personal consumption, not just a slower rate of growth. Such a decline would be the first since 1991, and it would almost certainly push the entire economy into a recession in the middle of an election year.” Even Starbucks has discovered that in the present climate a five-cent bump in the price of a coffee drink has customers racing for less costly alternatives.
The funny thing about numbers is, as much as they can frighten us, when we dig deep enough there’s usually something worthwhile to be learned. Historically the great circus bosses are the ones who make money in good times and bad. We’ve all heard of the talents of Jess Adkins even in the deepest years of the Great Depression “making it work” despite the overall economy. Mr. Adkins wasn’t alone. Now famous titles like Kelly Miller were born in that era of little money. And as far back as Mr. Coup’s Barum show economic intelligence (the numbers) have allowed circus to weather the downturns. This is not a nostalgic evocation for the old days and the old ways, economic intelligence, timely information and the ability to use that information is at the heart of every circus business success story from Mr. Bailey and Mr. Cooper, to Charles Hunt, to the owners and managers of today’s shows. Whereas the great bosses of the past routed around areas suffering from crop failure, or draught, low agricultural prices, or Yellow Fever, today’s manager may look at other data, passing communities and states hardest hit in a downturn, or finding a better means to market a show despite the crunch.
Almost certainly in a downturn no intelligence is more important than notations on localized economic conditions coming first from an astute booker with the where-with-all to inquire about employment/unemployment, real property trends, and the health of the retail sector prior to booking in to a town; then an informative advance providing a timely “heads up” a month or more before circus day if all is not as it should be. A generation ago at least some shows had the luxury of dramatically altering routes mid to late season responding to bad economic news from upcoming dates, today it’s up to marketing to make a show attractive even along an under-performing corridor. We all know with circus you’ve got to park it somewhere every day. Flexibility in ticket prices, promotions, and built-in to agreements with sponsors is never more vital than in down years when there may be less money for advance events, mailings, television buys, or co-sponsorship with radio.
If numbers are prognosticators fortunately we have better access to intelligence today than ever before. Months ahead of the outdoor season a quick glance at reports from the Federal Reserve Bank, Moody Financial Services, etc. paints a clear picture of those communities worst hit by the collapse of the mortgage market and an implosion in real estate values and associated equity. Conservative estimates suggest that home prices across the US will decline by 13% by the end of 2009. While that number impacts all but a handful of communities, far more dramatic are the declines in the Sunbelt where prices overall could dip by 20%, or Florida, California, and Nevada in particular where some communities will see a likely drop of as much as 35%. Showing in communities like Modesto or Stockton, California, or Punta Gorda, or Ft Walton Beach, Florida may take deep pockets and a brave soul, highly motivated sponsors, or a smart marketing plan taking in to account that these are among the hardest hit cities in the country. Even middle-class families will be budgeting with care. Michigan, likewise, so often a place of boom or bust for outdoor shows is already in full-blown recession. On the other hand states like Texas, Montana, and Colorado look pretty good, while some areas of the historically depressed Northeast (Binghampton, New York for example) fare better because home values remained relatively stagnant through much of the recent bubble. While brokerage houses like Goldman-Sachs predict that recession is very likely across all of the American economy through 2008, estimates from The Conference of Mayors tell us that some communities like Anderson, SC, Cedar Canton, OH, Fort Smith, AR, etc. will be impacted far less than places like Salinas, CA, Orlando, FL, or Charlotte, NC. Marketing that directly reflects conditions in localized economies might weigh toward higher admissions prices in the oil patch or the grain belt where commodities values are stronger, and lighter touch elsewhere in an effort to fill seats. It’s always interesting to look back at the many seasons of the Hunt Circus and Mr. Hunt’s willingness to peg admissions prices to conditions in the communities he played. Today’s twenty-dollar ticket in one town may be a fourteen dollar ticket in a town just across the state line. The right price is the price that brings out crowds allowing even a recession battered per cap to generate more dollars.
Selling circus has become a sophisticated enterprise and any show using direct mailings relies on demographic and census information to make or break the day. Further filtering based on current localized economies and pricing and marketing accordingly is just the digital application of the same make or break economic intelligence as old as the railroads. The down economies throughout the 1970’s saw a rise in the number of small and medium sized circuses, as did the affluent years of the mid-1990’s. While it’s easy sometimes to blame poor business on competing entertainments, in reality there are 100 million more Americans today than there were in the 1960’s. It’s no secret that regulation and a massive scaling back in phone operations have probably had as great an impact on circus as changing audience habits. Heading in to this election year, rather than looking at the numbers too pessimistically it’s well worth remembering the positive. We’ve been here before. During downturns families look for bargains. So long as a show is perceived by consumers to be affordable as defined by the economics constrains of their own community, so long as they believe they are receiving good value, so long as the advance works and the sponsors are motivated and the lay downs are there, so long as folks actually know that the circus is in town, the numbers should be all right.