Tuesday, April 29, 2008

NIN Try to Fix Flawed Ticketing System

One thing that technology has ruined is the distribution of concert tickets. Unfortunately, by the time I hit the age to go to concerts, the technology was there. I remember, though, a few times when I went to a physical Ticketmaster outlet to buy tickets. Yes, you had to wait in line for long periods of time, but if you're a fan of the music, it's worth it.

At my school, events were sold at tables and you had to wait in line the day of the sale to purchase tickets. Being a dumb freshman and witnessing the massive line that assembled for Red Sox-Yankees tickets, I assumed that something similar would happen when Dave Chappelle was doing a show on campus...well man was I wrong. I was the first person in line around 7 am, waiting for 2 1/2-3 hours for tickets to go on sale...I think like 10 people came in behind me around 9:15. However, I'm proud to say that I was the biggest Dave Chappelle fan on campus.

I wish tickets were still sold like this. Instead, scalpers, ebay-ers, and ticket reselling agencies scoop up the good seats in quantity, hike up the price about 400% to those who can afford it, and leave some of the biggest fans in the back row. I recently bought Radiohead tickets. Knowing that they were going to play a show in Philly, I constantly checked their website for updates on the date and when tickets were going on sale. Out of nowhere, a presale for pit tickets started on a Wednesday morning...unfortunately, I had a meeting at work and by the time I got out, all of the pit tickets were gone. I brushed it off and waited for the public sale that following Saturday, which I woke up atleast an hour and a half in advance for, and constantly hit refresh on the ticketmaster page as it neared 10 am. My first request...lawn seats. What the hell? Fortunately, I lucked out with someone who backed out of their seats, but the seats are still toward the back.

I would gladly camp out for front-row seats to Radiohead. Anyone who is a big enough fan of a certain group would probably do the same, and the people who are grabbing all of the good seats just to make a profit probably would not.

Well, Trent Reznor is seeing this, and has made a small effort toward fixing it. It's nothing new...fans that are registered on the NIN site get first access to the best seats at their shows. I think that there's probably no way to cutting out technology and going back to selling tickets at physical outlets with physical lines of people, so I suppose this is one of the best ways to get the good tickets in the hands of the real fans.

Technology has had a huge impact on music and artists need to realize that sometimes that impact can hinder the true fans from being true fans. There's a movement toward cutting out the middleman between the artist and the fans with music...why not do the same with their concerts?


Mike said...


It's not a flawed system. It's Capitalism.

A few things from a former ticket broker:

1. "Artists don't sell out venues, ticket brokers do." Remember this always. This is a truism that many a broker learns breaking into the business. It will be important to remember in a minute.

2. What's too expensive for one consumer is petty cash for another. Cost is relative.

3. It's not a broker's fault that the artist sets the price point incorrectly.

4. MOST IMPORTANT THING PEOPLE DON'T EVEN BOTHER TO THINK ABOUT - brokers don't make money on every ticket. As a matter of fact, the 80/20 rule generally applies - they make enough money off of about 20% of the tickets they actually profit from to cover the 80% of LOSSES they have on other tickets. "Artists don't sell out venues, ticket brokers do."

Yes, ticket brokers actually lose money on the majority of tickets they sell. For every ticket that you have to pay double for from a broker, that broker has to dump 4 or 5 tickets for half of what they paid for them. There are so many factors that come into play - venue, weather, if the artist adds more shows last minute, if the demand isn't there, if the price point is actually too high, etc - that its really a black art to sell tickets rather than a science. It's finding a sweet spot in the market. Some artists should be on their knees thanking ticket brokers because they set their prices so high that no one would buy them without the brokers gobbling them up.

Remember these quotes from Mike:
"Artists don't sell out venues, brokers do."

"Brokers don't make money on the majority of their tickets."

"Just because you won't pay $150 to see a band, doesn't mean another fan won't."

KW said...

Ok, Mike...

1. It's a flawed system for fans...I'm not talking about the artists. But how can you know that an artist won't sell out a show on their own if every single show is getting crowded by 3rd parties?

2. I wasn't directing the argument specifically toward ticket brokers, but thank you for pointing out that brokers do not always make a profit. If that's the case though, why do it? I seriously doubt ticket brokers go into the business to help out struggling artists. Can you honestly tell me that you got into being a ticket broker to break even? If ticket brokers can sell the tickets at double the price to sell out a show, doesn't it make sense that the show would sell out if all of the tickets were sold at face value? Yes, "artists don't sell out venues, ticket brokers do." Well how can you know that if ticket brokers are buying tickets to every single show?

3. I realize that some fans will pay hiked up prices over others - and that's fine - my point is that not enough fans get an opportunity to pay face value because of all of these 3rd parties. Someone with a low-paying job should not have to dump a month's pay on seeing their favorite band.

David Oblas said...

KW: Someone with a low-paying job should not have to dump a month's pay on seeing their favorite band.

Which is of course very true for Mr Kevin here who makes $1 an hour.

KW said...

That's right

Mike said...

Whether or not the argument is directed towards brokers, brokers are an integral part of the equation.

It's not a flawed system for fans. What it all boils down to is that big acts sometimes don't price their tickets high enough.

Simple supply and demand: tickets are limited to seats in an arena, fans outnumber the seats, prices go up. Somewhere, as Adam Smith would say, an "invisible hand" sets a price point that balances both the supply and the demand.

When artists set the prices to low, you pay more for tickets from brokers. When they set them too high, you pay less.

Brokers play an arbitrage game with high rewards on the tickets that pay. When the ticket prices are set too low, they make a TON of money. That usually more than makes up for when the prices are set too high and they don't make money or lose money. They mitigate their risk by trying not to purchase ones where the prices are set too high. Unfortunately, the myriad of circumstances beyond their control often effect the outcome.

It's not a flawed system for the fans at all.

"I realize that some fans will pay hiked up prices over others - and that's fine - my point is that not enough fans get an opportunity to pay face value because of all of these 3rd parties. Someone with a low-paying job should not have to dump a month's pay on seeing their favorite band."

Sad to say it, but that's life. If the band really cared, they'd play more shows at bigger stadiums. I really want a Ferrari, but I don't have the money for it yet. If Ferrari mass produced the cars and put cheaper parts in them, I'd be able to get one.

KW said...

I am in no way against capitalism...don't get me wrong.

But who are the brokers to say that prices are too high or too low? The venues and artists work out the cost of a ticket, and I'm sure they cover all of their own expenses.

What you said was the capitalistic achievement of ticket brokers (selling out venues) is now what you're saying is simple supply and demand. I agree with the latter. If we're talking about a big act at a big venue here...if you can't manage to be one of the 20,000 people to get a ticket when it first goes on sale, you're not the kind of fan I'm sympathizing for.

But big artists sometimes play smaller venues...and a ticket broker is completely unnecessary for the artist to sell out the venue. If the artist is OK with the price of the tickets being sold, that should be the final decision. Why should a broker make a profit off of the success of someone else? [Yes, I know...because this is America]

I would not go so far as comparing this to Ferraris though. Ferraris are not produced with the intention that everyone get a chance to drive one around - you have to work hard to be one of those people. Music, on the other hand, is for everyone.

My ultimate point is that selling tickets for something at a physical outlet is much more fair for everyone. If a broker camps out and dedicates his time to staking out a spot in line in order to resell those tickets for a profit, good for him/her. Being a fan should be about dedicating your time though, not necessarily just your wallet.

Hillary Clinton said...

we'll I would like to have another debate about this.