Who's Really to Blame for High Ticket Prices?

A majority of individuals and households have chosen to drastically cut their entertainment spending due to the economy. And with the rising cost of tickets, concertgoers have no choice but to limit the number of performances they attend. Although many blame promoters, ticket sellers and artists for the rising cost of prices, ticket brokers and resellers are often the causes of drastically rising ticket prices. While some artists are concerned about making money and raising their prices, Eric Church is looking out for his fans by offering cheaper ticket prices and special discounts for his “Church Choir” fan club members. But this strategy of offering cheaper tickets has backfired due to ticket scalpers.

In a recent article on Billboard Church said that for his latest tour they were trying to keep ticket prices for the GA pit and front row reasonable and accessible to fans. Members of the “Church Choir” were allowed to purchase 8 low priced tickets at a time. However, as ticket brokers joined the fan club and purchased large amounts of tickets under multiple accounts some fans ended up paying between $200 and $400 for those very same tickets. In addition to penalizing the fans with higher prices there are around 500 to 600 tickets (according to Billboard) outstanding in the hands of these high priced ticket brokers that very well could cause Church’s performances not to sell out.

After realizing that scalpers were purchasing a majority of the tickets, Church’s team began looking at all of the purchases and trying to pin point the resellers. They have also updated their fan club membership policy to state, “If you’re reselling tickets, it’s grounds to cancel your membership.” While this policy change might slow down the scalpers as they search for a way around the system, it won’t stop them. As Church says, “They are just some slimy sons of bitches.” 

www.ericchurch.com/tour

So for now all that Church’s team can continue to do in the fight against scalpers is review the ticket sales and fan club members. Additionally, in the future they plan to use the tools Ticketmaster offers to help stop scalpers from purchasing the tickets to help keep the prices reasonable for the true fans.

- Lisa - 

What the "How To" Website's Don't Teach You

Go to Google and type in, “concert promoter.” What you will find is a plethora of websites teaching you how to be a concert promoter. Most of these websites, however teach you nothing about the importance of finance. Yet, understanding finance as a concert promoter is one of the most significant pieces of the puzzle.

After working in the banking world for two and a half years I have come to the realization that there are many people who do not fully understand the concept of finance. Most people are scared of finance and at the mere mention of it they respond with “oh, I HATE math!” But finance is not math. Yes it deals with math, but simply put it is “the science or study of the management of funds.”  

For a concert promoter who is looking to be successful in the industry, the knowledge of how to manage funds is a must. As a promoter you are responsible for all of the expenses associated with the show. With bigger arena venues or outdoor festivals, most of the time you are given a blank slate and are expected to pay for everything including equipment, security, set up and tear down, as well as any specifics included in the artist’s rider.  Smaller venues will usually offer many of the services as well as equipment, but generally they will require some type of profit from the event and take in to consideration everything they are offering you. In addition to the amount you will need up front to pay for the venue and all of the equipment, you will also have to consider all of the other expenses that go along with running a business. Marketing and advertising costs, office supplies, phone service, salaries or wages for employees, travel expenses, and even taxes will all have to be included in your expenses. Making a list of all your expenses may seem like a tedious task, but it will help you to determine the amount of revenue needed to be profitable.

If you’re just starting out as a concert promoter you may be thinking, “where am I going to get the money to pay of all of this?” There are many avenues available to promoters and business owners alike. However, no matter which route you choose to acquire the funds necessary to pay for an event, you will need to have your expected income and expenses in order before any of them agree to give you the money. Borrowing from a financial institution is always an option, however it will be based on your credibility, and lets be honest, banks are very hesitant to lend money these days. A better option as a concert promoter is to look for an investor, someone who will give you money in exchange for either a stake in the company or a portion of the profits from a specific event. And last, but not least, you can look to other local businesses or individuals to be a sponsor of your event.

(For more helpful information on concert sponsorships check out the eJams Entertainment Blog – 7 Concert Sponsorship Proposal Tips)

Although there are many websites out there that teach you “how to be a concert promoter” there are very few that actually talk about the finance involved in promotions. Almost every decision made by a concert promoter, from the type of venue chosen to the final outcome of the event has to do with finance. You may get lucky when promoting an event without understanding the financials of your business, however you can be sure that the luck and the business won’t last.


- Lisa -