Weak economy stifles concert tour business
Jeanwah
Posts: 6,363
NASHVILLE, Tenn. — A slow economy and a glut of choices is turning the once ironclad summer tour season into something of a gamble.
The evidence is everywhere. The always bankable Eagles have canceled dates. Christina Aguilera shut down an entire tour before it got started. Rihanna and Ke$ha just canceled their tour opener, which was scheduled at White River Amphitheater in Washington. It was the tour's only Northwest stop.
Add in what seems like a large number of injuries, illnesses and mysterious happenings that have led to sometimes legitimate cancelations — U2's tour was postponed due to Bono's back surgery — and at least outwardly it looks like summer tours are starting to see the strain the rest of the music industry has been experiencing.
Korn's Jonathan Davis calls it "scary."
"It's just a sign of the times," Davis said. "We're in a bad place now financially, everybody, and I think people are cutting back. Hopefully when this goes away, whenever it does, then things will get better, but it doesn't surprise me that people don't have as much money to spend as they used to."
Kevin Lyman, the brains behind The Warped Tour, the Mayhem Festival and the new Country Throwdown Tour, acknowledges he was sweating it last week. The always bankable Warped Tour, a 16-year-old traveling punk festival, was struggling to sell tickets for a Ventura, Calif., show and he was looking at a big loss.
He sold 80 percent of his tickets in the last week and ended up with a great turnout.
Ozzy Osbourne believes the industry is tone deaf when it comes to the main problem — ticket prices. A premium seat with VIP privileges for a top act can go for more than $1,000. A mediocre seat at one of those shows might cost more than $400. Pollstar, the touring industry trade magazine and website, shows the average cost of a ticket in 2009 was $62.57 — up from $25.81 in 1996.
Osbourne, one of rock 'n' roll's most bankable touring stars and the founder of Ozzfest, said "people are getting very greedy."
"You can't charge exorbitant ticket prices," he said. "It's crazy. You have to read the market."
That market has appeared
strong, running in the opposite direction of the economy the last few years. Pollstar estimated a record $4.6 billion in worldwide tour grosses in 2009 with a record 40.5 million tickets sold. Both figures were significant increases over 2008. The top 10 tours of 2009 grossed about $771.6 million with U2 taking $123 million.
An analysis of first-quarter ticket sales in 2010 by Pollstar showed the trend is continuing with gross revenue and sales up from last year.
Looking at those numbers, Pollstar editor in chief Gary Bongiovanni sees this summer as nothing more than business as usual in an industry that's usually volatile.
Sure, ticket sales are down, but that's to be expected and nothing disastrous, as some industry watchers have claimed. He points out that there are several in-demand tours that are doing just fine.
Lady Gaga, Justin Bieber and James Taylor and Carole King aren't having problems selling tickets, perhaps muscling in on the fans of Aguilera, The Jonas Brothers and The Eagles. That out-of-favor acts like Limp Bizkit canceled shouldn't send folks watchers into a tizzy.
"I mean the Limp Bizkit tour was never one that really should've been booked in the first place," Bongiovanni said. "It's hard to say that business is bad because Limp Bizkit couldn't sell tickets. I'm sorry, I don't buy that."
He did say that promoters need to get rid of the glut.
Lyman and others believe the cause of all these problems is simple. In an effort to shore up record sales that are bottoming out, artists and their managers and agents have turned to summer tours and the large amounts of guaranteed money now being offered upfront to prop up the revenue stream.
Instead of taking a year or two off between tours, acts always seem to be on the road — sometimes with nothing new to offer. The bigger the venue, the bigger the guarantee and the bigger the risk that a slow start to ticket sales will lead to cancellation.
In desperation, promoters have fallen back on the steep discount, cutting prices, nixing service fees and offering two-for-one deals. Lyman sees this as fool's gold. Once ticket prices are cut, promoters rely on ancillary sales such as beer and hot dogs. But he's noticed in these tough economic times, fans will bolt a six pack in the parking lot because it's cheaper than buying $7 beer all night.
"I've been saying it for a year now: We are going to train the public to wait for the discount," he said. "Go out for a fair price at the beginning and people will grow into it. But now we've got a lot of damage to fix in this business."
http://www.statesmanjournal.com/article ... r-concerts
The evidence is everywhere. The always bankable Eagles have canceled dates. Christina Aguilera shut down an entire tour before it got started. Rihanna and Ke$ha just canceled their tour opener, which was scheduled at White River Amphitheater in Washington. It was the tour's only Northwest stop.
Add in what seems like a large number of injuries, illnesses and mysterious happenings that have led to sometimes legitimate cancelations — U2's tour was postponed due to Bono's back surgery — and at least outwardly it looks like summer tours are starting to see the strain the rest of the music industry has been experiencing.
Korn's Jonathan Davis calls it "scary."
"It's just a sign of the times," Davis said. "We're in a bad place now financially, everybody, and I think people are cutting back. Hopefully when this goes away, whenever it does, then things will get better, but it doesn't surprise me that people don't have as much money to spend as they used to."
Kevin Lyman, the brains behind The Warped Tour, the Mayhem Festival and the new Country Throwdown Tour, acknowledges he was sweating it last week. The always bankable Warped Tour, a 16-year-old traveling punk festival, was struggling to sell tickets for a Ventura, Calif., show and he was looking at a big loss.
He sold 80 percent of his tickets in the last week and ended up with a great turnout.
Ozzy Osbourne believes the industry is tone deaf when it comes to the main problem — ticket prices. A premium seat with VIP privileges for a top act can go for more than $1,000. A mediocre seat at one of those shows might cost more than $400. Pollstar, the touring industry trade magazine and website, shows the average cost of a ticket in 2009 was $62.57 — up from $25.81 in 1996.
Osbourne, one of rock 'n' roll's most bankable touring stars and the founder of Ozzfest, said "people are getting very greedy."
"You can't charge exorbitant ticket prices," he said. "It's crazy. You have to read the market."
That market has appeared
strong, running in the opposite direction of the economy the last few years. Pollstar estimated a record $4.6 billion in worldwide tour grosses in 2009 with a record 40.5 million tickets sold. Both figures were significant increases over 2008. The top 10 tours of 2009 grossed about $771.6 million with U2 taking $123 million.
An analysis of first-quarter ticket sales in 2010 by Pollstar showed the trend is continuing with gross revenue and sales up from last year.
Looking at those numbers, Pollstar editor in chief Gary Bongiovanni sees this summer as nothing more than business as usual in an industry that's usually volatile.
Sure, ticket sales are down, but that's to be expected and nothing disastrous, as some industry watchers have claimed. He points out that there are several in-demand tours that are doing just fine.
Lady Gaga, Justin Bieber and James Taylor and Carole King aren't having problems selling tickets, perhaps muscling in on the fans of Aguilera, The Jonas Brothers and The Eagles. That out-of-favor acts like Limp Bizkit canceled shouldn't send folks watchers into a tizzy.
"I mean the Limp Bizkit tour was never one that really should've been booked in the first place," Bongiovanni said. "It's hard to say that business is bad because Limp Bizkit couldn't sell tickets. I'm sorry, I don't buy that."
He did say that promoters need to get rid of the glut.
Lyman and others believe the cause of all these problems is simple. In an effort to shore up record sales that are bottoming out, artists and their managers and agents have turned to summer tours and the large amounts of guaranteed money now being offered upfront to prop up the revenue stream.
Instead of taking a year or two off between tours, acts always seem to be on the road — sometimes with nothing new to offer. The bigger the venue, the bigger the guarantee and the bigger the risk that a slow start to ticket sales will lead to cancellation.
In desperation, promoters have fallen back on the steep discount, cutting prices, nixing service fees and offering two-for-one deals. Lyman sees this as fool's gold. Once ticket prices are cut, promoters rely on ancillary sales such as beer and hot dogs. But he's noticed in these tough economic times, fans will bolt a six pack in the parking lot because it's cheaper than buying $7 beer all night.
"I've been saying it for a year now: We are going to train the public to wait for the discount," he said. "Go out for a fair price at the beginning and people will grow into it. But now we've got a lot of damage to fix in this business."
http://www.statesmanjournal.com/article ... r-concerts
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Comments
i really do think that the consumer who would rather steal music online than purchase a $12 cd has been just as big of a cause for this as the economy.
"Well, you tell him that I don't talk to suckas."
I agree with you. Friends of mine can afford $120 sneakers, but can't spend $12 for a CD? That's stupid. Then when ticket prices come out, they complain because the price of the ticket is too high. They tell me, "Nah, I'll just download it off of [torrent site]" and then I tell them, "Don't complain when ticket prices are high."
Does anyone remember last year, I think, before or after Backspacer came out, Ed was talking about people complaining about buying a $12 CD? I remember someone posted it on here and I don't remember the link. Ed was right, of course.
"Becoming a Bruce fan is like hitting puberty as a musical fan. It's inevitable." - dcfaithful
Look at your local amphitheater or arena in the past year... almost all re-tred shows with big prices...
I mean, I like Tom Petty and all, but I'm not dropping $250+ ($100 per ticket w/fees, parking and a couple drinks) for my wife and I to go see him in decent seats. I saw him before and it's a great show and good music, but $250 for a few hours? no thanks...
And sure, lawn seats are cheap, but I'm not paying to see a show on TV monitors... The Ten Club has spoiled me, I need decent seats lol... I'll wait for a tour DVD to come out.
was like a picture
of a sunny day
“We can complain because rose bushes have thorns, or rejoice because thorn bushes have roses.”
― Abraham Lincoln
"Well, you tell him that I don't talk to suckas."
Live Nation is know to offer the highest performance fees to bands just so that they can capture a huge market share. Higher ticket prices are a direct result.
No one is innocent here!
Absolutely... Live Nation for years has been known to overpay for entire tours just get the big names. And when it comes down to shows at their amphitheaters, they don't even really need to break even on ticket sales... They get the ancillary revenues (at least a % of) for concessions, parking, VIP clubs, merch, etc., not to mention all of the sponsorship at their venues.
And bands are to blame too when it comes down to production... Bands like Pearl Jam can put on a great show with 5 trucks and a small crew, so even with low ticket prices, there is some room for profit. When you have 20+ trucks and a small city touring with you, costs are astronomical, so they just get passed along to the customers.
was like a picture
of a sunny day
“We can complain because rose bushes have thorns, or rejoice because thorn bushes have roses.”
― Abraham Lincoln