Work for the Fans in a Down Economy
At the Billboard Touring Conference in New York last week participants discussed what’s in store for the live music industry as the economy enters a steep recession. Pricing was one of the key points discussed and many in the audience want to lower ticket prices as the economy falters and consumers reduce their discretionary spending.
There was a contrarian voice in the room in the form of KISS member Gene Simmons. A full-throated capitalist, Simmons told the audience not to cut prices,
“You’re training an entire generation of people to pay less for something and then more for something else. They won’t know what the value is and they’d rather pay less every time,” the media superstar stated, warning that lower prices would dilute the value of concerts in the long term. “If they’re used to paying $100 for a big thing, then give them $100 worth of entertainment, put 10 bands together.”
While I agree with his sentiment, the overall industry has to look at pricing given the number of businesses now competing for fans’ wallets. It’s in everyone’s interests to keep the fans coming out in tough times and pricing is one of the ways we can do this. I was speaking last week with Dean James of MAMA Group, who is seeing strength in his small club business. He thinks that a £12 cover and another £12-15 on drinks makes for a great Saturday night and keeps the fans coming back. Charging £25 for bands like Primal Scream only leads to empty halls and a downward trend on prices…
as you can see the last trade on Seatwave for this show was at £14 per ticket.
Conventional wisdom will tell you that live events are not as badly affected by a recession as other sectors of the consumer discretionary economy and I would agree we have the characteristics of an anti-cyclical business (fans go 1-2 times per year, perceived as a treat, no real replacement offering) but we test this notion at our peril if we allow the upward spiral of prices to continue unabated.
Why Do Business with Companies that Threaten You?
“All tickets purchased on this site are governed by our terms and conditions. In particular, we draw your attention to the fact that all tickets are for personal use only and cannot be resold under any circumstances. Resale or attempted resale is grounds for seizure or cancellation without refund or other compensation. The Event Partner and its affiliates, successors, or assigns may enforce these terms in accordance with the provisions of the Contracts (Rights of Third Parties) Act 1999 (the Act).”
These are the less-than-comforting words that confront every purchaser of a ticket on seetickets.com in a pop-up screen just before completion of their online purchase (with the terms and conditions stating that “Any resale or attempt to resell the tickets at a price higher than purchased will result in your orders being cancelled without prior notification”). Remember See Tickets is run by the same person who’s been lobbying Parlaiment to prevent fans from being able to resell their own tickets - his incentives are not really aligned with yours. Theatre Tickets Direct offer similar terms and conditions:
“Resale of tickets purchased through this website is prohibited. Resold for commercial gain ticket becomes voidable and the ticket holder may be refused entry or ejected from the venue.”
Both are indicative of the out-of-touch and consumer unfriendly approach to the world. Both companies seem to be stuck back in the mid-twentieth century. Threatening your customers before they’ve even taken receipt of your product is never a good strategy unless of course your customers are not your customers. Both companies in question are engaging in anti-competitive behavior to prevent fans from buying and selling tickets themselves. It seems that you, my friends, are the new competition.
Remember that ticket agents want to make sure they sell all the tickets they have as they make more money this way. If fans are able to buy and resell tickets more tickets are for sale in the market (supply) which the laws of economics tell us will satisfy the demand and/or drive down prices – both outcomes are bad for ticket agents. So instead of focusing on how better to serve their customers these companies would rather try to scare you out of their markets.
As I’ve said before, the law regarding terms and conditions of the sale of tickets has not yet been tested under UK legislation. Until a case reaches the court – for example, where a member of the public takes on one of the sellers in the primary ticket market – we can only guess at the outcome. For our own part, Seatwave has always asserted that the terms and conditions with which event organisers seek to bind consumers are extremely unfair and fly in the face of market forces. The lack of refunds, exchanges, returns and a ‘no right to re-sell’ policy could all potentially be challenged under the Unfair Terms in Consumer Contracts Regulations.
We’re doing all we can at Seatwave to provide the mechanism by which customers can buy and sell tickets with confidence and peace of mind because we understand that good businesses in the twenty-first century align themselves with the interests of their customers, not against them.
Consumers need to stand up to the practices of bullying sites such as seetickets.com and voice their opinions and when you cannot, we will stand up for you. When fans can’t make an event, do they really want to be hamstrung with the option of either throwing away a worthwhile ticket or face the threat of legal action?
Without fans’ patronage, these sites will soon be conscripted to the dust bin of history which is where they belong. It’s now up to you to seize the initiative and make it clear that the way you’re being treated simply isn’t right.
A clash of manifestos
Seatwave was created by a group of people who believe that getting tickets should be really easy and safe.
It was with interest, then, that I read the most recent blog entry of David Semple, who runs the leftist blog Though Cowards Flinch. Semple suggests that Dr Eamonn Butler, of the Adam Smith Institute, is wrong when he says that:
“An open and secure secondary market has got to be good for fans. Seatwave, for instance, offers a guarantee that the tickets it sells are genuine, 150% refund if they do not arrive on time, and a full refund if the event is cancelled (which is more than you get from many promoters).”
Semple also argues that secondary ticket markets are “effectively making money for no work” and are “mak[ing] life harder for normal people whilst contributing nothing to the performer”. Strong words. Let’s see how his argument stacks up.
Firstly, the statistics show that most UK sellers (85 per cent) on Seatwave sold fewer than six tickets last year. Hardly the work of “parasites” (Semple’s word).
Secondly, the secondary marketplace performs a valuable service for fans. We’ve all faced the prospect of not being able to make an event – for whatever reason – for which we’ve already bought a ticket. Without sites such as Seatwave, fans would be left with unwanted tickets and no remedy.
And at the risk of provoking David Semple’s ire with the Adam Smith Institute still further, perhaps he should mull over these words from James Lawson:
“Events organisers encourage a second-hand market in tickets by setting prices artificially low. Prices used to be set cheaply to boost sales in merchandise and records. Organisers also wanted to ensure high turn outs. This is still usually the case, but that is not a reason to stop legitimate traders selling at true market prices.”
As you’ll find stated elsewhere on our site, our guiding principles have always been that:
- We will help people get to events and we’ll help them do it in a secure way
- Many people believe that tickets have become just too expensive…we agree and we undertake to do our best to reverse this.
- We will make it easier to purchase tickets.
- Our experience has been that ticketing agencies treat consumers badly – to us that doesn’t make sense and we commit to treating our customers with respect.
It’s generally accepted economic theory that transparent markets are more efficient and help to reduce prices. Seatwave operates as transparent a ticketing exchange as possible. We also take every opportunity – and even try to create opportunities – to lower ticket prices for fans. We won’t promise that Seatwave will always have the lowest priced tickets, but we will promise to try in the short (and long) term, to lower the average price of all tickets.
As for Semple’s “jammed phonelines” and tickets at venues being sold out too quickly for fans to get hold of them – as one of the comments to James Lawson’s article recognised, that points back to the people who whinge most about them…namely the promoters and venue operators themselves.
Glastonbury bucks the trend…
Question:
How can music festivals beat the credit crunch?
Answer:
Put up your prices and borrow money from your customers!
It was announced this month that the organisers of the Glastonbury Festival are releasing tickets early for next year’s event, without the headline acts being confirmed. What’s prompted this?
For Glastonbury 2009, fans can either book a place with a £50 deposit per ticket or buy tickets outright at £175 (plus a £5 booking fee). The festival’s organisers say that the deposit will allow fans to ‘spread the cost’. How very generous and public spirited of them. But it does sound remarkably like a Christmas Club scheme….and we all know what happened to Farepak.
The price of a ticket for Glastonbury 2008 was £160, so the 2009 price represents an inflation-busting nine per cent increase. Michael Eavis & Co say that the price hike is due to ticket prices previously being set too low and barely covering their costs. But this does seem to be inflation gone mad.
Actually this may all be Glastonbury’s answer to the credit crunch. Any small or large business now has an option – get your customers to pay nine months in advance on the off-chance that they might wish to partake of your services nine months later.
Sounds like a great wheeze. And by the way if you don’t end up wanting to come (because we haven’t told you what our ‘service’ will be) you’ll only get £40 of your money back because we’ve used up £10 ‘administering’ your money. What next? Sainsbury’s asking for £50 for next March’s shopping bill? £50 for a meal out next June – but we won’t tell you what’s on the menu?
If you buy a ticket for next year’s festival and, at a later date, decide that you don’t actually want to go or can’t make it, what options are open to you? Not many. The organisers won’t allow you to resell your ticket and you’ll only be allowed a refund until 8 May (and even then you’ll still have to pay the £10 charge). Alternatively you can ‘insure’ your ticket for £3.90 (2.2 per cent of the value of a ticket), which is a pretty steep charge. Oh and don’t forget the additional £4.50 postage.
This is all about offloading risk on to the loyal fans of the Glastonbury Festival. Either that or it’s poor judgement on the part of the organisers. But watch out – if this one goes belly-up, there will be no bail-out from the Government.
Theatre ticket sales in the spotlight
There is so much that’s good about British theatre that it’s a shame that those that run it are so behind the times. The West End continues to produce some top class musicals that are exported worldwide and its plays often feature the very best actors around. Josh Hartnett is the latest star to leave the comfort and megabucks of the Hollywood Hills to tread the boards in London. But despite the UK’s excellent track record of attracting the cream of the world’s acting talent, one recent development suggests that its theatre intelligentsia have some way to go before reaching the Age of Enlightenment.
Huge online sales for David Tennant’s West End debut in Hamlet have prompted the Royal Shakespeare Company to announce that it would render void any ticket found to have been re-sold. The RSC is tracing re-sellers through the seat number included in their online advertisements for tickets. What would the RSC prefer – a return to the old days of touts lurking outside venues? A complete lack of consumer protection? If their intention is to pursue touts, then they are going about it the wrong way – the statistics show most UK sellers (85 per cent) on Seatwave sold fewer than six tickets last year.
The law in this area is vague and untested. The snappily-titled Unfair Contract Terms Guidance, updated last month, seeks to establish a fair balance between the rights of consumers and suppliers. Seatwave has always asserted that the terms and conditions with which event organisers seek to bind consumers are unfair. The lack of refunds, exchanges, returns and a ‘no right to re-sell’ policy could all potentially be challenged under the Unfair Terms in Consumer Contracts Regulations. Given that, at one time or another, we’ve all faced the prospect of not being able to make an event – for whatever reason – for which we’ve already bought a ticket, practices such as those exhibited by the RSC simply don’t face up to reality.
The secondary market is a classic case of supply and demand. It provides an invaluable function and operates to find the optimum price that fans are prepared to pay for a ticket. And re-selling theatre tickets is not against the law. The sooner the RSC realises that pursuing its own fans will simply serve to alienate them, the better for theatre lovers everywhere.
ASTA Takes a Half-Measure
Pollstar reported that ASTA has announced a bonding scheme for all its members whereby Lloyds of London will insure every ticket purchased from an ASTA member:
“All members of the Association Of Secondary Ticket Agents are to be bonded under a scheme underwritten by Lloyds Of London and scrutinised by the Financial Services Authority. ASTA chairman Graham Burns said the move is a reaction to the collapse of two U.K. secondary ticket agencies that appears to have cost sport and music fans about £7 million.”
If a consumer buys a ticket from a member of the group and that seller subsequently defaults on delivery, the consumer will get a 100% refund. Pretty basic. Seatwave has been offering TicketIntegrity(TM) since we opened for business and many of the other exchanges in the market offer similar schemes, so it seems ASTA had no choice but to follow suit. But does it go far enough?
Most fans want to go to the event for which they are buying tickets, and in some cases travel very long distances to see the shows of their dreams. A refund doesn’t help these folks all that much beyond a small consolation. If Graham Burns and ASTA wanted to put some real teeth into this proposal they would force their members to put up the bond themselves and then repeat offenders - who cost the other members cash out of their pocket - would surely be shamed or run out of the organisation. We all need to work together to weed out the rogue traders, but ASTA believes that giving fans a refund while keeping the bad apples in the bucket is sufficient consolation. We don’t think so - the bad apples need to be chucked out and frankly if ASTA refuses to do this they are as much a problem as the dodgy brokers themselves.
So where do we go from here?
Seatwave provides a 100% guarantee to its customers AND actively scores all sellers, removing those who demonstrate an inability to operate with respect for fans - we think ASTA and others should do the same until there’s no place for the criminals to hide. Anything short of this is capitulation to fraud that will keep this industry from moving forward into the clear light of the 21st Century. Come on ASTA, take the next step!
One Giant Leap…
Recently Ticketmaster announced that they are planning to trial their “paperless” tickets for a special Metallica show at the O2 Arena. Fans who buy tickets online will be able to show up at the gig with their credit card and picture ID and swipe their card through a special turnstile – associated with each unique ticket sale – to allow them access.
This is a great step forward and a huge advance in event ticketing. Now that companies like Ticketmaster are having their monopolies challenged, they are reacting with real innovation that benefits not just artists and ticket sellers, but fans as well. Paperless tickets will remove the weeks of anxiety we all go through waiting for our tickets to arrive in the post. One of my big problems with the music industry in the UK today is promoters’ desire to hoard, control and hold on to the tickets until the last possible moment, and then send them all out a week – or later – prior to the show. Tickets for Madonna’s Wembley Stadium concert on Thursday only arrived this week and last year’s Metallica tickets arrived just a day or two before the event – a terrible way to treat fans.
Now Ticketmaster is going to rescue us from this fate…but there’s one catch. Some people tell me they fear Ticketmaster will use this technology to prevent fans from reselling their rightfully purchased property – for whatever reason – and use this innovation to control and stifle free trade further. I certainly hope not. When they introduced print-at-home tickets some years ago, the same people thought the same thing about this electronic method of ticketing, but it ended up providing more options for fans. I hope that Ticketmaster realises that the resale of tickets is here to stay (in fact they’ve made two bets in TicketsNow and Getmein totalling $300 million that it is) and fans expect and demand the ability to buy, sell or hold wherever, whenever and however they choose to.
Time will tell. But for now I am pretty happy to be able to swipe away.
Something bigger than Seatwave
When we set up Seatwave, it was our goal to change the way that fans connected with tickets. The way in which tickets were distributed was broken and we wanted to make it safer and easier for everyone to see the events they love (or ones that suck but see them nonetheless). We also believed that, in order to affect these changes, Seatwave must take a position in the centre of the live entertainment ecosystem.
This began a process of engaging the industry in debate about the ticket market and speaking with government about how we could work together to make it better. In parallel, Seatwave also began working with grassroots and charitable organisations to help improve the entertainment world. We know that we occupy a space much bigger then ourselves and have committed to continuing our contributions wherever we can.
In December 2007, Seatwave partnered with the ABC Trust to offer several pairs of tickets to the Ahmet Ertegun tribute show featuring the reunion of Led Zeppelin. Seatwave helped ABC raise over £130,000 for their programmes to improve the lives of Brazilian children - an estimated 7 million of whom live on the streets.
In June 2008, Seatwave then sponsored the River Rack Pack Tour of up-and-coming UK artists who embarked on a throw-back canal ride from London to Oxford. It was our hope - one that came to be - that Seatwave could play a small part in helping to showcase the talents of young artists to larger audiences in the UK and beyond. With thousands of views on You Tube and distribution on MySpace and other sites, Seatwave had begun to help bring new music to the masses.
Just two weeks ago, Seatwave employees held a raffle to raise money for Youth Music, a UK-based organisation to supplement music education in the national curicculum. While we’re starting small with this one, we believe that Seatwave and its employees can help provide material support for the millions of UK youth who want to pursue their musical talents.
We do these things not because we want to but because we need to. The future of our culture - our children - require frequent and impactful support to help them grow into the people who will take ownership of our society. It’s easy for us to comment on the troubles of youth and the resulting horror stories we see every day. Instead the people of Seatwave are choosing to take an active, purposeful part in improving our corner of the world just a little bit.
Note to LOCOG – ‘Let’s fill these seats with people!’
I hope that Gerry Sutcliffe, UK Minister for Sport, is closely watching the ticketing fiasco unfolding at the Beijing Olympics. The Games are only a few days’ old and have already seen some highly significant developments – and I’m not just talking about the gold medals being won by British women or Michael Phelps’ aquatic feats.
Firstly, there is the sad tale of beijingticketing.com, the website that allegedly sold fraudulent tickets for the Olympics and conned people – including the families of many athletes - out of thousands of pounds. Secondly, are the sparsely populated Beijing stadia, particularly in those seating areas apparently reserved for corporate sponsors. For some reason unbeknownst to the world, the bigwigs in the corporate sections have decided to sit this one out and droves of seats remain empty. But re-selling tickets is illegal in China, and with no legitimate secondary market to redistribute the tickets to the millions who clearly wanted to attend the games, the stands remain half-full and the athletes’ four years of sweat and dedication have so far been met with thin applause.
We have long argued against special protection for so-called ‘Crown Jewel’ events in the UK, which in 2012 will include the London Olympics. The UK Government has suggested that tickets will only be made available on the primary market with no mechanism to ensure every seat is filled with an engaged fan. But do we really want our Olympic venues to be half-empty? That is the potential scenario if corporate ticket-holders cannot re-sell unwanted tickets. The British public, who after all are footing the bill for 2012, deserve the opportunity to experience the Olympics as much as the fatcats - if not more so.
The organisers of the Beijing Olympics were trying to do the right thing in trying to prevent a black market in Olympic tickets but their ticketing partner, Ticketmaster, offered no vision or foresight to assist them in figuring out how to create a safe and secure mechanism for people who genuinely cannot attend an event.
The solution is a legitimate and controlled resale market to avoid empty seats with both fans and athletes being disappointed. It is critically important to the success of the London Olympics that LOCOG operates in an environment in which it is free to consider all possible solutions to this vexing issue. We want the committee to look at all aspects of the problem and consider the impact on thousands of fans before it make its decision.
Lessons from Las Vegas
At last month’s Ticket Summit in Las Vegas I joined a panel on Emerging Markets - Europe to discuss the nascent secondary ticket market on this side of the Atlantic. The panel included Andrew Blachman from Getmein and Graham Burns from ASTA (the Association of Secondary Ticket Agents). While the session meandered across a series of topics, it gave an interesting perspective on the literal and metaphorical distance between the American and European markets.
The vast majority of the 700+ brokers who attended the conference have strong local relationships in their markets and use fairly sophisticated global distribution systems to leverage one another’s supply. Additionally, they have learnt from US ticket exchanges that succeessfully completing orders is the Number One priority of their business - customers must always come first. I made the controversial comment that some ASTA members “commit the worst consumer abuses I have seen in the ticketing business” which is true and needs to change. Seatwave and other exchanges must provide clearly defined and enforcable rules that protect consumers. If this doesn’t happen and customers lose confidence, we only have ourselves to blame.
Additionally, brokers and groups like ASTA need to take responsibility for the delivery of their own service and move away from the notion that a refund is as good to a consumer as a successfully delivered order. Brokers of the old mindset need to be excluded from the distribution that ticket exchanges provide, or change their behaviour and step into the 21st Century. If ASTA wants to be relevant then it must lead its members to this shift and be a real force on the side of fans. Otherwise it will continue to be a circus sideshow in the UK.
The opportunity exists for the secondary market to create a proper consumer category and we can opt to open our businesses to the prospect or remain in the “old country” of consumer abuse and irresponsible behaviour. It’s time to choose.
Seatwave Top Sellers- Peter Kay from £29.99
- Six Nations from £60.00
- Kings Of Leon from £79.99
- Jay-Z from £44.06
- Aerosmith from £48.54
- Suede from £25.50
- Them Crooked Vultures from £42.75
- Arctic Monkeys from £70.00
- Reading Festival from £32.50
- Leeds Festival from £45.00
- V Festival from £117.00
- T in the Park Festival from £115.00
- The Who
- Noel Gallagher from £99.99
- Florence and the Machine from £23.24
- AC/DC from £71.89
- Lady GaGa from £65.90
- Robbie Williams
- Michael Buble from £43.63