In an industry believed to be recession proof, live music has indeed seen an overall dip in sales throughout the prime summer touring season. There are of course, quite a few explanations for the downturn, i.e the economy, ticket prices, reductions in dates, and the overall cancellation of tours. Regardless, the main goal for promoters, ticket sellers, artists, and managers is to find what model works best for them in the current environment.
Some believe that the touring industry is now beginning to feel the crunch that the rest of the music business has been in for the last few years. The slow pace of the economy, coupled with summer festivals and an oversaturated live music market, has turned its prime season upside down. In a tight economy, concertgoers are cautious about how they spend their disposable income. “We’re asking an awful lot of the public,” said Pollstar editor in chief Gary Bongiovanni. “[For] the acts that are really in demand today, fans are opening their wallets and buying tickets, and they’re buying the premium seats, too. But in a down economic market, it just means you aren’t going to do the kind of volume that you might expect and people are more selective.”
After the summer came to an end, it was reported that the gross revenue for the Top 100 tours in North America was down 17 percent from last year. Some of the most anticipated tours were no-shows. Christina Aguilera and Limp Bizkit announced tour dates and promptly cancelled them, as they likely could not deliver on the guarantees required by the large arenas and amphitheaters. The shock of the summer came with U2, which, following last summer’s 360 Tour, was poised to be a record-grosser. Emergency back surgery for a front man is, nevertheless, a rare event, and U2’s cancellation seemed reasonable. However, no such factor played into the sporadic deletions of tour dates by The Jonas Brothers, Lillith Fair, Rihanna, “American Idols Live,” The Eagles, Kings of Leon, and Rascal Flatts.
It must be duly noted that even during the downturn, there were a few tours that managed good numbers. Although no official records of attendance have been released at the time of writing, it is apparent that Jimmy Buffett, Brooks & Dunn, Tom Petty and Toby Keith were at a sellout or near-sellout level. A handful of acts have been able to sell consistently across the board year after year, regardless of circumstance. Paul McCartney and Lady Gaga have proved to be recession-proof, but typically acts are competing with each other; established acts, like Justin Bieber, James Taylor, and Carole King, have the advantage.
Music festivals compete too for the same business. Fans can examine festival line-ups, and can spend all their music money on one ticket to see a number of their favorite acts over a weekend. This year alone, C3’s Lollapalooza smashed its attendance record with a whopping 240,000 people. Festivals work a great deal with bands, fans and sponsors, generating enormous publicity as well as revenue.
All things considered, some sources are pointing out to a shortage of “new blood” within the live music world. This year, Sugarland emerged as the only new first-time headliner (not surprisingly, the tour was not well attended). Promoters now seem to be adding more international artists to their rosters, hoping to create a new wave. In the grand scheme of things, it is evident that there is a huge disconnect between what music is popular right now, and what can be seen live.
Changes were implemented to try and compensate for low attendances. Live Nation, the biggest concert promoter in the country, discussed new ways of handling their artists. CEO Michael Rapino stated that the company would be negotiating lower guarantees for existing talent on their roster. This, fused with other measures, would help Live Nation get better results and sign up more artists. Overall, and according to Rapino, there is a supply problem with talent, and tour dates, given their limited market appeal, are now far too expensive.
Lowering ticket prices is also part of the discussion. Live Nation offered discounts on tickets as low as ten dollars—and with no service fees; the company had been toying with such deals for years, anticipating that the ancillary revenues from parking, merchandise, food and other areas would offset the potential losses of weaker shows. Ticketing reductions, however, can be a double-edged sword. Kevin Lyman, who spearheaded The Warped Tour, says that they bring (sic) fool’s gold. “In times of recession, who is to say that ancillary revenues will be up to snuff, with the off-the chart prices of food, drink and merchandise?” He continues: “We are going to train the public to wait for the discount; people will wait to buy their tickets until the last minute”. Lyman suggests going for a fair price at the beginning that people can be comfortable with. Although some fans will always pay premium price to go and see their favorite acts, a different overall approach seems to be needed to drive the business forward. Tiered or dynamic pricing will still be around for long, but prices may have to come down overall. In the short run, discounts are unlikely to lead to packed houses.
Still, for Pollstar’s Gary Bongiovanni, “this summer was nothing more than business as usual in an industry that’s usually volatile.” Indeed, it might be difficult to make any predictions about the live music industry at a time of crisis, and more normal times may have to set in for change to be considered in earnest.
By Kerry Fee
Branch, Alfred Jr. “Live Nation Moves To Pay Artists Less To Tour In 2011.” TicketNews. http://www.ticketnews.com/news
Peoples, Glenn. “Live Nation Pushing Back On Artist Guarantees.” Billboard. < href=”http://www.billboard.biz/bbbiz/content_display/industry/e3ia497cf655575dc8301f2e59a7e03dc81. 09/20/2010″>http://www.billboard.biz/bbbiz
Mervis, Scott. “Summer Concerts Highs and Woes: Amid the cancellations and sluggish sales, the 2010 season had its up sides.” Pittsburgh Post-Gazette. http://www.post-gazette.com. 09/16/2010.
Talbott, Chris. “Sour Note: Economy Hits Summer Tours.” AP Entertainment Writer. http://www.msnbc.msn.com.
“Live Nation On Track To Meet Reduced Outlook” Associated Press. Billboard. http://www.billboard.biz/bbbiz.