Ticketmaster Introduces Dynamic Pricing to Boost Ticket Sales: How It Works for You and Against You
I don’t normally pay too much attention to the business of ticket sales and distribution, as I’m sure most people don’t. As long as I’m able to procure my seat for the Chicago showing of Green Day’s American Idiot – The Broadway Musical, I’ll be a happy camper. Just kidding—I’ll wait for the movie.
In any case, a recent L.A. Times article regarding live-event ticket sales sparked my curiosity. Ticketmaster is going to be rolling out a new pricing system this year—a “dynamic pricing system”—which will allow them to alter the prices for event-tickets based on market demand. So, for example, when an upcoming concert for [whichever trendy band the kids are listening to these days] isn’t selling particularly well, ticket prices will drop, potentially boosting sales. Conversely, if tickets are selling out like crazy, prices will go up—though how significant the price jump will be is anyone’s guess (and will likely vary by artist).
Concerts just don't rock like they used to.
The new system is intended to combat last year’s downturn in ticket revenue. Concert turnout was rather unhealthy in 2010, with overall ticket sales down by roughly $150 million from the prior year. In the article, Ticketmaster’s Chief Executive elaborates on the benefits of the new pricing model, noting that “clients will be able to retain economic value that is normally siphoned off by the secondary market, and to sell more of their tickets that go unsold today. Meanwhile, more fans will have more opportunities to enjoy live entertainment events because tickets will be more accessible and pricing options will broaden.”
It’s an admittedly bold move on the company’s part, but a risky one as well. It would constitute an entire shift in the pricing model for live-event tickets. Given that Ticketmaster is essentially the Facebook of their industry, it’s hard to imagine why they’d be so gung-ho about an overhaul, and so willing to risk making things worse. It’s quite a gamble, and whether Ticketmaster’s customer base will be as keen on the idea as they are is up for debate.
NIN tickets aren't cheap, ya know.
According to band manager Jim Guerinot, who handles a number of reputable artists (No Doubt and Nine Inch Nails among them), “you’re going to see a lot more concerts priced correctly [this year].”
Concerts are finally going to be priced correctly? Sounds great, in theory. There’s just one problem: when the demand for tickets to a Nine Inch Nails concert skyrockets (which it will), so will the cost—under the new system, that is. This will leave certain poor folk (namely myself) unable to afford the experience. And I can’t even afford it now!
Sure, there’s bound to be an upper limit on prices, but what would that limit be? And will it prevent the marginalization of fans on the lower end of the income spectrum? I suppose we’ll just have to wait and find out.