💵Ticketmaster's Use of Dynamic Pricing Is Questioned?!
💵Ticketmaster's Use of Dynamic Pricing Is Questioned?!
November 4, 2022 #160
Hey y’all!
As the boy says, “What’s goodie?!”
Final shout out to share your ideas and feedback heading into 2023 on the survey!
More numbers and more pictures is already being implemented.
#BreakUpTicketmaster podcast is live!
I’m in Boston next week Wednesday-Friday. Hit me up.
To the Tickets!
I. The Big Story: Dynamic Pricing: What’s That?!
Dynamic Pricing as a tool isn’t bad. But its application sure can be.
The Big Idea: Ticketmaster’s Dynamic Pricing tool is coming under more scrutiny.
Why Does This Matter: Journalists, fans, and regulators are calling out the practices as “manipulative”, “dishonest”, and “sketchy”. This perception is opening the door to potential antitrust investigations and new regulations from governments around the world.
Backlash: Dynamic Pricing is a tool with upside and downside, like all other tools.
Upside:
A content producer can capture more of the upside.
Prices can be adjusted more quickly to meet market values.
A producer can understand their market more completely.
Downside:
Customers can feel like they are being mistreated.
Customers can change their buying decisions due to in-the-moment pricing.
The practice can undermine brand equity.
What’s the Deal Here: The practice is being sold as a “win” for acts because they are capturing more of the upside, fighting back the secondary market, and creating a “safer” environment for fans.
Is that true?
Regulators in the US and the UK don’t seem to be buying this justification. As the statements from regulators have made clear.
Should You Use Dynamic Pricing?
It is definitely a tool that people should consider, if only because it requires you to do pricing research.
Another angle here is that Dynamic Pricing often helps you break down some of your hidden biases.
As with all tools and ideas, you need to do your research.
What you should look for when considering using Dynamic Pricing:
How are prices being set in your building now?
What do your ticket sales look like?
What does success for your organization look like?
Do you know your target customer?
Do you have a clue what and why people are buying?
We can go further, but any organization of any size can start here by asking what they hope to achieve and looking at the keys to a strategy:
Who is our market?
Why are they picking us?
Go Deeper: I’ve had some folks on the podcast to talk about Dynamic Pricing in the past like:
II. Tools: vivenu:
Simon Weber talks about how vivenu came to be on the podcast.
The Big Idea: I played with the vivenu technology last week and it is so easy I was able to build a seat map for a venue in under 5 minutes.
Looking at the Numbers:
2043 hours saved annually! (That’s 51 weeks! That’s hiring a new person.)
Your customers can purchase a ticket in as little as 11 seconds.
100%: the data you own!
I like Simon and the vivenu team.
If your organization is thinking about a new ticket system, I think that vivenu is one you should check out.
III. Concepts & Ideas: Anticompetitive Practices:
Check Out the FTC’s Anticompetition Website.
Even Deeper: Anti-monopoly and monopoly harms action is being called for.
Go Deeper: Krystal Ball and Saagar Enjeti look at Ticketmaster and the new focus on antitrust implications of the Live Nation merger.
IV. Bullets: 10 Lessons from the #BreakUpTicketmaster conversation:
Monopoly power is present throughout the economy, not just tickets.
Some of the bad behavior is never clearly stated. That is often a sign of anti-competitive behavior. Nothing has to be stated, fear of retribution is always present.
It is rare for artists to come forward and express harm because the risks of retaliation and harm to their livelihood are so high.
Vertical integration is the heart of the coalition’s argument. That means tickets, venues, artist management, and more.
Covid made this issue more important because small independent venues were financially strained and unable to stay afloat—creating an even more consolidated marketplace.
It is rare for a consent decree to be adjusted as it was in the case of Live Nation.
Big Business doesn’t mean bad business.
Some of the causes of anticompetitive behavior are systemic.
The feedback around “Junk Fees” was extraordinary because the petition had nothing to do with ticket fees.
Harms here include lack of innovation and we are in one of the low innovation periods in American history. You can draw a link.
One More Thing: Jon Stewart talks with Representative Katie Porter about competition.
She says we have a monopoly problem in America.
Video, but there is a podcast version as well.
V. Links
Every brand needs to invest in its brand:
Your sales team and sales efforts happen further down the funnel.
80% of money spent on promotions isn’t wise. In an FMCG environment like Asos, they should be investing about 60% of their marketing budget on long-term brand-building investments.
In tickets, you can shoot for 50/50 to start but you need to understand that the investment in brand building doesn’t pay off immediately. You won’t likely see all of the benefits until the second and third year.
This goes for any size venue, team, or league.
The only difference here is smaller leagues or leagues/teams/venues with declining attendance and sales might need to invest more in brand building to help recreate the brand in customers’ minds.
“The market is unpredictable”:
This might be the understatement of the year, but the lesson for everyone is that you need to not make assumptions about demand for next year or the year after…for that matter.
270.9 million people around the world watch gaming:
That’s a ton of people.
The way to look at this isn’t about the gaming, but to think about how you can use this large of an audience to drive top-of-mind brand awareness.
eSports teams were the rage, but I get the feeling that this wasn’t the real opportunity…brand awareness was and is.
What do you think?
The Rotherhithe and East London Playhouse offer free tickets:
This is a great program.
Art and artists were how I learned about the world as a kid in the middle of nowhere Northern Georgia.
This is one of the reasons I still spend a good deal of time on tickets and entertainment stuff because the power of the arts to teach us is unsurpassed.
So helping kids that are from disadvantaged backgrounds is a real winner to me!
Linktree: Find everything I’m up to.
Join the ‘Talking Tickets’ Slack Group. Almost 300 people from around the world.
Customers are buying refund protection at rates 2x higher than before the pandemic.
Offering your customers refund protection:
Gives customers certainty in their purchase.
Gives you a new revenue stream.
Improves your customer service.
Great podcast conversations: Take your business to new heights by learning from the best in the business.
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Aren Murray
Bill Guertin
Scott Goodacre