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C H A P T E R
Concert Venues
The play was a great success, but the audience was a disaster.” — Oscar Wilde
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enues come in all sizes and types, from giant, sprawling sports stadiums to mid- sized arenas to recital halls to roadhouses with 12x8 plywood stages. At one time or anoth- er in a career, an artist might be found playing dates at state fairs, outdoor festivals, amusement parks, casino ballrooms, municipal auditoriums, night clubs, or college multi-purpose rooms (see Table 17.1). The venue industry’s scale and dynamism is enormous. Think opera houses and traditional concert halls are a stagnant, no-growth part of the economy? How’s this for a factoid: For the last two decades in the U.S. alone, an average of more than one opera house or concert hall a month has opened its doors for the first time, some of them costing hundreds of millions of dollar apiece. Add to that the countless smaller venues that house artists of every level and every genre, and the opportunity is obvious.
Venue Contracts
As we’ve seen in other parts of the music business, contracts are the glue that sets the rules for relationships between parties working together to achieve mutual success. And how the rules are written largely depends on the clout of the various parties. A promoter and booking agent representing a top-tier act bring clout to a negotiation Left: Smetana Hall at Municipal House, Prague. Photo © Philip Gould/Corbis.
290 L I V E^ M U S I C Stadiums. The largest facilities for concerts, these multipurpose venues offer seating of 30,000+ and typically are configured for sports events. Since such facilities are not designed for live concerts, they require extensive setup/tear-down of concert stages. Amphitheaters. Outdoor venues typically seat between 5,000 and 30,000, and are used primarily in good weather/summer seasons. These are specifically designed for concerts, with permanent stages. Festival Sites. Outdoor locations used seasonally typically accommodate between 10,000 and 120, patrons for day-long or multi-day concerts. For operators, these venues are attractive because of low overhead costs, resulting in some of the industry’s highest profit margins. Arenas. Smaller than stadiums, these indoor venues typically seat between 5,000 and 20,000. Arenas often have luxury private suites—premium-priced seating areas that amphitheaters lack. Because they are multipurpose facilities, they typically require extensive modification to install stages. Theaters. Venues designed for legitimate theater can be easily adapted for concerts and typically have seating for 1,000-6,000. Mid-Sized Music Venues. Designed for concerts, these indoor facilities have ready-built stages and typically have capacity for between 1,000 and 6,500 persons. With this low-capacity seating, however, they don’t offer potential for outsized profits, as do the larger venues, even in a sell-out. Small-Sized Music Venues/Clubs. Music and comedy clubs dominate this category of indoor venue, which sometimes provide beverage and/or meal service for patrons at their seats. Because seating is typically less than 1,000, capacity limits revenue potential and seats are sometimes moveable chairs. But these facilities have built-in stages, which reduces costs. Table 17.1 Seven Types of Concert Venues The concert venue business carries the important responsibility of public safety. Seven people died in a 2011 outdoor stage collapse amid gusting winds at the Indiana State Fair. The contractor that built the stage, the Indiana State Fair Commission, and a stagehands’ union were blamed in a subsequent state safety agency investigation. Photo © Steve C. Mitchell/epa/Corbis.
292 L I V E^ M U S I C of the performed works. This practice may defy common sense, but is reasonable since a venue manager is hardly in a position to parse the details of co-publishing arrangements that determine royalty allocations.
Ticketing
The venue is booked, the artist is signed, the sponsors are on board, and the promotion strategy is in place. All that’s left now is to sell those tickets. Promoters, as their name implies, are responsible for encouraging people to buy tickets. But online ticket sellers typically contract with venues, and not promoters. Ticket Purchasing Centralized online ticket purchasing is a far cry from the long lines outside box offices that buyers had to face decades earlier. Now fans typically purchase their tickets online and arrange for pickup at the event, or simply print out a barcode or save the barcode on their smartphones and have it scanned at the event. Artists often reserve part of a venue’s tickets for members of their online fan clubs. Online ticket purchasing has itself become a big business. Leading online ticket seller Ticketmaster, which Live Nation Entertainment acquired in 2010, sells over 100 million tickets online each year. Ticket prices vary based on the caliber of artist, prestige of the venue, and economic heft of the city. Midsized arenas with music talent that has radio play but is short of big star talent often price tickets $15–$75. When superstar talent plays in big cities where there’s a big section of wealthy residents, ticket prices can range from $25 to $350. Some superstars offer front row seats with backstage access for even more money in big cities where wealthy patrons are concentrated and can afford to pay for VIP treatment. Fan customs vary by city, with some fans buying tickets within just a few days of the event or even making walk-up purchases on the very day that a concert is held. Transactions for tickets sold for cash are difficult to trace later, so there is always a possibility of undercounting an audience. In such cases, the venue could shortchange the promoter or the promoter could shortchange the artist. Some promoters place hired persons at venue entrances to count the audience as it streams in or photograph the crowd in their seats, in order to generate their own independent estimate of crowd size. Ticket Terms The term that promoters hate to hear most is deadwood , which refers to unsold tickets. Promoters who ask, “How much deadwood did we have tonight?” clearly want this number to be low or, better yet, zero. If it’s obvious that ticket sales are slow and there will be a lot of deadwood, promoters might choose to paper the house, where they give away tickets so the audience doesn’t seem embarrassingly small. One technique to boost sales is to sharply cut prices of the least desirable seats to spur sales to bargain hunters. Deciding how many of which type of seats will be sold at what price is called scaling the house. Seats in the first few rows of each section are generally priced higher, although there may be venues in which the better seats are midsection, near the wings, or just outside the orchestra section.
C h a p te r 17 C O N C E R T V E N U ES (^) 293 Tickets for reserved seats guarantee their bearers a specified seat in a specified location. General admission (GA) tickets mean that whoever arrives first has the choice of seats. GA concerts may provoke more security concerns due to ticket holders pushing their ways to the better seats. Secondary Ticket Market Some websites, such as StubHub, specialize in reselling tickets at prices higher than face value for in-demand acts or closer to original value if a concert suffers slow sales. Fans and the music industry gripe about huge markups and blame speculators, called scalpers , but sometimes it is the artists and their associates who are confidentially making the allotment of tickets available to third-party resellers. The ticket scalping problem is driven by basic supply-and-demand, but such ticket scalping is a problem for promoters because the artist, agent, and promoter usually share in none of the profits, and the scalper has taken advantage of a paying customer. The markups irk fans and have brought criticism from artists like Bruce Springsteen. Scalping is now illegal in many areas, but the practice continues because ticket resellers have found legal work-arounds.
Licensed Merchandise
According to marketing researcher, The Licensing Letter , the sale of licensed celebrity entertainer merchandise is a $2.4 billion annual business at the consumer-spending level in the United States and Canada_._ That makes this business—which includes sales from live events as well as traditional retail—comparable in revenue to the concert ticket business. Growth in this merch market has come from innovations that go beyond the sale of traditional T-shirts and posters. Now, music stars promote leading fashion brands and license their persona for fragrances. Vendors selling souvenirs at a concert. Photo © Neal Preston/CORBIS.
C h a p te r 17 C O N C E R T V E N U ES (^) 295 Generally speaking, the smaller the seating capacity of a venue, the higher the expectations are for merchandise sale on a per capita (each person) basis. The thinking is that the most loyal fans will account for most of a small audience. Conversely, per capita sales expectations are lower for the biggest venues—such as stadiums— because the throng is usually a mix of light and die-hard fans. A final issue sometimes addressed in contracts is specifying a venue’s responsibility to crack down on sale of unauthorized artist merchandise—which is illegally made and marketed—that might spring up around a venue on concert day and diminish sales of artist-sanctioned merchandise. Concerts with many artists performing, such as festivals, are the least lucrative because fans buy “event” merchandise such as souvenir programs that do not generate royalties for any one artist.
Venue Trade Association
The venue business trade group, the International Association of Venue Managers (www.iaam.org), helps industry professionals navigate in a changing field.
Chapter Takeaways
- Concerts venues come in an array of con- figurations ranging from cavernous stadiums seating tens of thousands to intimate settings that can hold only hundreds of spectators.
- Venues can be hard-nosed negotiators with promoters and performers, because they don’t want to be left with unexpected liabilities when everyone else leaves town.
- Music artist-themed licensed merchandise is a multi-billion dollar business in itself, rivaling the size of the concert ticket industry.
Key Terms
ı (^) deadwood (p. 292) ı (^) geographic exclusivity (p. 291) ı (^) hall fee (p. 294) ı (^) merchandise/merch (p. 293) ı (^) royalties (p. 294) ı (^) scaling the house (p. 292) ı (^) secondary market/ticket scalping (p. 293)
Discussion Questions
- What are the advantages and disadvantages of securing a larger or smaller venue? 2. Should artists handle their own merch, cutting out the middleman? Why?
