This post was authored by FMC intern Danny Weiss. Full video after the jump.
Back in May, Live Nation and online discount service Groupon announced a joint venture to bring live event tickets to the deal-a-day online discounting space. The service, dubbed GrouponLive, is meant to combine the local distribution power of Groupon’s online coupons with Live Nation’s broad reach as concert promoter and ticket broker (under the umbrella of Ticketmaster). More specifically, the service aims to make a last push to sell out large venues for big name acts — Britney Spears’ summer “Femme Fatal Tour” saw a nice boost in last-minute ticket sales as a result of the GrouponLive push. And according to Melvin Benn of Festival Republic, this is a model that “undoubtedly works.” But it seems there may be consequences to heavy ticket discounts with these so-called “flash sales.”
With the initial success of the model, many believe that ticket discount sales will continue to grow in popularity and frequency. Benn, in an interview with BBC’s Radio 1, continued, “It’s definitely emerging. In tough economic times people will look at varying ways of pricing their tickets.” But others in the artist and promoter communities are concerned. At the 2011 Future of Music Policy Summit, managers, venue owners and promoters discussed the implications of heavy ticket discounts, much like those distributed by GrouponLive. Check out what they had to say:
Here’s what some musicians and artist advocates are most concerned about:
1. Flash ticket sales could change the perception of the live concert experience for the worse. By heavily discounting tickets, flash sales could change the perceived value of the live concert experience and cheapen the value of live shows in the minds of fans.
2. Flash sales could change consumer behavior and expectations when buying concert tickets. By offering heavily discounted tickets just days before a show, many believe fans will simply wait until the tickets drop in price. This pattern could severely weaken artists’ ability to sell tickets at full price and could undercut profit margins for artists on tour.
3. Many believe flash ticket discounts like the GrouponLive venture could harm the artist-fan relationship. By offering heavy ticket discounts to fans that are on the fence about a show, artists could alienate their most loyal fans who bought tickets the day they went on sale.
Though the GrouponLive model is currently only being used for arena-level acts and promoters, there is potential for this to spread to more venues and affect more artists. At FMC, we are concerned about how musicians are affected by new businesses models. We believe that, while experimentation is good, we should never lose sight of the artists’ long-term best interests. That’s why we’re paying close attention to these new developments in ticketing.
Watch the full “Get Your Tickets Here” panel over on Vimeo.