Ticketmaster’s Irving Azoff was speaking at a Bank of America Merrill Lynch Conference the other day about the virtues of “dynamic pricing” that Ticketmaster will begin implementing next year. Live Nation CEO Michael Rapino was at the conference as well, and supports dynamic pricing as reported by Pollstar.com.
Everyone that has flown is familiar with this form of selling. With dynamic pricing there is no “face value” or printed price on the ticket. You will pay by market demand at the time you are purchasing the ticket, just as you do when you buy an airline ticket. If the seats are selling well, the price of the ticket will go up… and up. And if the seats are not selling well, we assume they will drop the price. But I’m willing to bet that prices will drop for the less desirable seating only. They’ll be sure to get their money out of the best seats in the house. Which means on average, the concert fan will be paying much more for the quality seats, and who knows how much more for the rest of the seating
The question is, will it work? I say, Hell No! Concert fans are already being pressed to pay top dollar for aging rockers and pissed off enough at Ticketmaster and Live Nation with all of the added fees. And even if you hide those fees in with the dynamic pricing as I suspect they will, it won’t change the high price of the ticket. Azoff can talk all he wants about the merits of dynamic pricing, but if it turns off the fans, they will stay away from concerts as they are already beginning to do so.
It doesn’t take much of an imagination to see Ticketmaster and Live Nation, holding back the best seats as they do now, and “dynamically” jacking up the prices as they release them after selling the lousy seats first. One reason this works for the airline industry is because you have more people who have to be at a specific place in a specific time period, and there are not many choices for the 150 plus people on the plane with you.
In contrast, most people don’t have to go to the concert, and your talking about many thousands of people, not a few hundred. Concert goers have much more of a choice than airline passengers. They don’t have to go to the show, and they have other entertainment alternatives to spend their hard earned money on.
So Irving, as you sell your new salvation for the lack of profits you have generated so far, consider this; you and your company get very little respect as it is from your own customers, how do you think they are going to react when they have to pay much more for the same old product, like Van Halen?