The Price Isn't Right

Have you ever tried getting into a buzz restaurant only to never be able to get a reservation? What happens? Chances are you skip going there all together, forget about it and settle for something easier and more accommodating. I often compare the concert industry to restaurants because in reality, they are the same. Both are luxuries we love, but ultimately in difficult climates like this one, do not need to survive. Whether the artists, their handlers, the promoters and ticket sellers realize it or not, their success is tied directly to service. Just because you are a celebrity and a multi-millionaire doesn't give you the right to treat people like crap. This is what the record industry did in the 1980's with the advent of cd's. The prices never came down to cassette and LP levels, even though they were cheaper to make. Even worse, they eliminated the single, meaning you had to overpay to get the song you loved on cd, even if it was the only good track on the album. What happened this decade? A revolt. When the advent of MP3's came about, I scoffed at them and thought to myself, "These sound horrible, there's no way these will ever replace CD's". I was wrong. One can point to the iPod, the easy availability of MP3's and dozens of other reasons why the record industry has seen eight-straight years of dwindling CD sales, but the reality is that the consumers felt ripped off. They still do. I can't tell you how often I speak to someone who justifies their illegal downloading on the fact that they overpaid for CD's for a decade or the fact that artists who charge $100 for a concert ticket, deserve to be downloaded. Regardless, nary a day goes by where I don't encounter a music lover who holds the industry at a whole with great disdain. It amazes me how industries thrive or die based on their service and celebrities appear to be given a pass. However, that could be changing.

For the last eight years, the concert industry has seen its numbers double. However, even though on paper it appears to be a boom industry, I think we all know that due to recent economic events that just because something is on paper doesn't mean it is real. The industry appears to have doubled its concert grosses, but this is largely due to ticket prices that didn't just double, but tripled, quadrupled and skyrocketed to heights where the average person can no longer afford a ticket. Overall attendance has dropped. For weeks leading up to Fleetwood Mac's two recent Chicago shows, I was able to pull up rather good lower level tickets daily. How is this possible? They were $150 and around $177 after Ticketmaster took their cut. This is in Chicago, the third biggest concert market in the US. Arena shows by superstar acts should sell out immediately but in recent years, tickets have proven to be plentiful and it's all tied to price and add on charges.

So far, the concert industry hasn't had the same woes as recorded music because the action is in the flesh. It's tangible, it's real, you can see it and in some cases feel it. However, in the latter case, more and more artists and promoters are withholding the best seats for those with the thickest wallets as evidenced by recent article by industry insider Bob Lefsetz and the Wall Street Journal. People always assumed this was going on, but now that it is out there for everyone to see, this may prove to be a mistake that will haunt the industry for decades to come. While everything may appear to be happy-go-lucky at the moment, there is a revolution beginning. I receive at least one email a day from a fan who wants me to write about "Artist XYZ" and their ticket prices. Most fans are disenchanted at the skyrocketing prices which they can no longer afford. Some will go above and beyond and pay the price, but at a cost. Instead of seeing twenty or thirty shows in a year, they are only seeing ten. Instead of seeing a specific artist five or ten times on a given tour, they are seeing one. The fan that would see ten shows a year is now seeing one or two. Then there is the fan that just can not afford it and opts out of going all together or finds a cheaper alternative. The artists pockets are widening, but the fans are becoming disgruntled and disenfranchised. This is not a good thing for the industry. I don't care how much money one makes, whenever actual attendance declines in any industry one needs to step back and think about their business model. Why? Because eventually even those with deep pockets will tire of paying exorbitant prices whether it is a play, a concert, a ball game or even dinner at a restaurant. If you went to a bar every night of the week and they doubled their price of beer, would you still go every night? If you bought a book every week and all of a sudden your book store tripled the price of every book, would you still buy one a week? Any industry that has declining attendance is in trouble and in the next few years, the bubble of the concert industry will burst.

How did this happen? Artists became greedy, plain and simple. They want a guaranteed seven-figure salary for two hours work. It's no longer about the connection to the fans or doing it because you love it, it's become about they money, much like many of our favorite athletes. Now, don't get me wrong, everyone has the right to charge whatever they want, alas I have the right to criticize those prices and more importantly, not buy a ticket to their show. People don't seem to understand how ticket prices teetered between $15 and $30 for arena shows for well over a decade and now the cheapest ticket is around $50, but then you find out its $70 after charges. I have a fan email me a few weeks back how they bought a lawn ticket for Kenny Chesney this summer and the price was $26.50, but after add on fees, it was over $50. That is a 100% mark-up. Could you imagine going to a restaurant and them including a 75% gratuity on the bill? You would argue with them and more importantly, you would never go back.

The recent Crue Fest should be an example of how not to run a tour. There were auctions, prices north of $100 and what happened as a result? None of the shows sold out and in some markets, only a few thousand shows up. The recent Blabbermouth report of their ticket earnings (found at this link) shows that instead of going out and selling every seat for $50 and $25 (the correct price point for a band that tours every year), they got greedy and would rather make a higher profit margin even if it means having empty seats. In 2005 Motley had almost all of their tickets for the winter and spring portion of their shows on sale for between $20 and $65. The result? Sell-outs across the board. I don't think Motley has properly sold-out a show ever since then (I don't count the intimate Vegas gigs). There is no value to their current show and even if they are performing Dr. Feelgood in its entirety, I just can't justify spending $100+ to merely see three songs I've never seen live before. When they toured together with Aerosmith in the fall of 2006, their Chicago show had a mere 13,000 people at it. To put things in perspective, the same venue in 1990 had 30,000 fans there just for Aerosmith. The same summer Motley Crue sold 70,000 tickets over two nights at Alpine Valley. Combined in 2006, they barely had enough people to fill a small arena. Why? Exorbitant ticket prices. If I were either artist, I would be embarrassed to perform to that many empty seats.

One artist that should be admired is Keith Urban. His most recent tour went on sale recently and in light of the recent economic downturn, he reserved a section at $20 per ticket with no service fees. There are acts that have affordable tickets, but all too often, a $17.50 ticket all of a sudden becomes $33. When I was younger, that was the difference between going to a show and staying at home. It's admirable to see someone understand this and ensure that no fees are collected for a ticket this cheap. Not everyone can afford to spend $50 or even $100 on a ticket in this day and age. Fall Out Boy is another act whose business model should be followed. They are playing arenas this spring with a ticket prices between $25 and $40 and the bill includes numerous bands. They understand their audience and are not pushing their luck for a few extra bucks. I should also mention that the arena show I saw by them back in 2007 was among the greatest arena rock shows I've ever seen and I've seen hundreds. Their mini I club tour last December had a top price of $35 and the Chicago show had $10 tickets available. They easily could have charged $50 and $75 for the intimate venues and still sold out, but they didn't. They understood that it's far sexier to have an easy sell-out rather than making more money from fewer seats sold. The artists that charge a reasonable amount of money will be the ones that win out in the end and have careers that will thrive and be admired.

I believe that if there is a turning point, it will because a veteran act will realize the stupidity of prices, make every seat affordable and as a result, will be "the" tour to see. Let's use the summer of 2004 as an example. Van Halen reunited with Sammy Hager and despite not playing together for nine-years, there were loads of empty seats at many of the shows. The average ticket was over $100 and people decided to sit it out and see someone else, like Prince. That year, Prince triumphantly returned and he had tickets as cheap as $20 in certain markets and his highest price was $75, which included a copy of his new cd and the stage was configured as in-the-round which allows for the best overall concert experience with all seats having an advantageous viewpoint. His shows sold-out anywhere and everywhere he played. It wasn't just because he's a phenomenal performer but because there was value in the whole package and most importantly, the price was right. KISS, Van Halen, Aerosmith, No Doubt and dozens of other acts toured that year and played to crowds a fraction of the size they once did. It isn't because the fans went away, it was because they can only afford a few shows and they were more discriminating in who they saw. In 2004, Madonna made more money on paper, but Prince's take home earnings were higher due to less overhead. It was proof that charging less can mean a higher profit margin. Not just that, the Prince shows were religious and whenever he tours again (he's due) everyone I know who went will be there again.

So the question one has to ask themselves is whether they want the highest gate receipts or the highest attendance? Do you want to be Madonna or Prince? If you choose the latter, then you won't just be a prince, but the king of the road. The fans will reward you will untold riches you never imagined. It's only a matter of time until one superstar act decides to price all tickets between $25 and $75 and have the tour of the year. The question is who will take that first step into a brave new world?

Anthony Kuzminski is a Chicago based writer and Special Features Editor for the antiMusic Network and his daily writings can be read at The Screen Door and can be contacted at thescreendoor AT gmail DOT com.




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