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This is the second article in a series where we pick the brains of live entertainment promoters to discover their tips and techniques for staying successful amidst worsening economic times. If you’ve got some good tips you’re willing to share, please email Eric Housh or DM @ticketbiscuit.
Sequoia Slentz is an independent promoter that does events all over the country through his company CleanBox Entertainment. He is the booking agent for the “Killer’s of Comedy” which features comedians from the Howard Stern show. Sequoia also books all of the West Coast Shows for “The Fab Faux,” a Beatles tribute band featuring Will Lee from David Letterman’s show and Jimmy Vivino from Conan O’Brien’s.
I caught up with Sequoia the first time on January 20th, four days before the scheduled Fab Faux show at the Orpheum in Los Angeles. “At this point last year, I had sold this show out- 1400 tickets – without spending a dime on advertising,” he told me, continuing, “this year, I’ve done it all – radio, mailers, you name it, but to no effect.” Four days left until show time, and Sequoia had almost half of the house left to sell.
This tale is all too common lately- promoters struggle to sell tickets in the face of an economy that has forced people to eliminate line items from their budgets. Line items that are typically seen as discretionary, such as concert tickets, are often the first things to go.
The next time I talked to Sequoia was last Thursday, January 29. The Fab Faux show did not sell out, but he did move enough tickets to make money. I asked him to share his secrets for success.
Negotiate, Negotiate, Negotiate!
The thing about the economy is that it impacts almost everyone, and that includes venues, radio stations, hotels, and many other businesses. This opens up incredible opportunities. “The idea is to spread the deficit around. Radio stations need to sell ads. Hotels need to fill rooms. Venues need shows. We all need each other, we gotta help each other out,” Sequoia states. He advises to negotiate with the venues for discounted rates, and with radio stations for discounted air time or ticket giveaways. “Radio stations have an incredible amount of inventory, and they’re willing to deal to sell them all.”
Working with Hotels was effective for Sequoia as well. As part of his effort to increase sales, Sequoia struck a deal with the Kyoto Grand Hotel to offer discounted tickets to hotel visitors. After the deal was sealed, he was approached by four other hotels wanting to ink similar partnerships. “If these guys have empty rooms, they’re losing money – so again, you can help each other out.” He says to also negotiate for inclusion in email blasts sent from the hotel, venue, or radio stations to their respective customer or fan lists. “It’s free and easy – most of the time they will be glad to.”
Being creative also helps. For this last show, Sequoia approached a Professor of the Music Institute and convinced the professor to give his class extra credit for attending the show and writing a paper on it.
Use the Tech Tools
Sequoia uses email marketing religiously. “I’ll use it to communicate with my lists, and I used promo codes to give folks the opportunity to buy tickets at a discount price.” While promo codes are a very effective way of generating sales and tracking marketing effectiveness, Sequoia cautions against the “double pitch.” “If I send an email out on the on-sale date, and someone buys a ticket at full price, then I send that person another email closer to the date announcing half price tickets, one of two things will happen. Either they will become trained to wait for the discount, or worse, they will get mad and not buy any more tickets at all. Both are bad, obviously.”
He says the way to avoid the double pitch is through careful customer management or third party surplus ticket sellers. “I used a surplus seller for this show and it ended up putting an additional $3k in my pocket at the very last minute. I was very happy with it.” Surplus sellers have opt-in databases of people who agree to be notified when discount tickets become available, so the dangers of discounting are mitigated.
Pay attention to the details
“The littlest mistakes can kill your operation. In 2008, I put the tickets for the Fab Faux show on sale in early October, and the show sold out without me spending a dime in advertising. This year, I put them on sale a month later- in November.” While this may sound harmless to the lay person, Sequoia says it was probably a key factor in the slow sales. “Sure, all of the bad economic news was weighing on people’s minds, but also, in November people are thinking about Thanksgiving, and Christmas, and travel, and mentally budgeting. The entire frame of mind changes.” He advises that promoters pay close attention to on-sale dates and times, and the trends of how the tickets move. “I’ve already put the tickets for the October 2009 Show on sale,” he added.
Stick it out
Business will continue to be tough for promoters, with recent estimates saying that the economic recession will last well into 2010. But while the business is admittedly tougher, Sequoia says it’s actually good for his operation. “We’re learning a lot and having to become better and more creative. Not all promoters will come out of this, but if you can stick it out, you will be positioned securely.”
According to Pollstar’s numbers, the concert industry made more money this year than it did last year, but sold fewer tickets. You can find the WSJ Article here.
What does this mean? Promoters raised prices. Now, how much of the 3% decline in ticket volume is related to the economy versus the almost 8% rise in price is related to the economy is anyone’s guess, but I think this picture could get a lot bleaker if the industry doesn’t come to Jesus. Quick. And I’m not talking about incorrect ticket pricing (this time), although I do still believe the industry is stuck in the dark ages on that front too.
It’s about embracing technology. Tech enables you to do things faster, cheaper, and better, but the concert and live entertainment industry has been slow to really embrace what tech can do for them. Trust me. Some folks are just anti-change (some of our clients are this way).
I read today that the Seattle Theater Group is dumping Ticketmaster in favor of one of our competitors, Tickets.com (too bad, STG – allllllmost a win). The most telling quote in the development is from STG Executive Director Josh Labelle:
“We look at Tickets.com as a technology company, less so as a ticketing company.”
YES, YES! Ticketing is just the beginning. Technology is the evolution. Venues, Promoters, and Artists have to start asking about how the technology in their partnerships (especially ticketing providers) is helping them reach more fans and sell more tickets. We’ve been innovating in this space for years and have tons of tools for integrating into the leading social media networks. I’m not sure how much more simplistic it can be: entertainers generate fans; ticketing companies should be able to connect to those fans, and help those fans reach and connect to each other.
I spoke with a young lady in the promotions business a couple of months ago who was using TicketWeb / Ticketmaster for their ticketing operations because of their “marketing” features. I showed her on paper how she was literally costing her company over a million dollars a year, ticketing fees that her customers are currently paying to TicketWeb that her company could keep if they went with an alternative provider.
What could you do with $1 million additional advertising? To cap it all off, with just a little effort, this marketing moron could have created her own online community around her act and had a marketing machine that was several times more efficient and long lasting (their show is targeted at kids, and several studies show that moms in general are very active online). FAIL.
Until the concert (and live entertainment) industry embraces the technology to improve their operations, they will have to continue to raise prices in order to deliver growth. And eventually (read: THIS YEAR) the customers will have enough and they will collectively say, “No, thanks.”
Next Up- Convenience Fees for Airlines?
March 3, 2009 in Commentary, Musings, ticketing news, Uncategorized | Tags: airlines, convenience fees, paradigm shift, self service, spirit, ticketing, ticketmaster | by ehoush | Leave a comment
A colleague forwarded me this article today – apparently Spirit Airline is considering making customers pay for the privilege of booking tickets anywhere other than their ticket counters in airports.
http://online.wsj.com/article/SB123604492886515417.html
Wow. Spirit must have some Ticketmaster folks on its board.
This is effing hilarious, and a good example of why the air travel industry is in such dire straits. I assume that Spirit Airlines either has paid up front costs for their reservation system or pays an annual licensing fee, but I doubt the cost ties directly to usage volume. I further suppose that the costs incurred by having ticket counter agents and space at airports exceeds the costs of the online reservation system.
So the airline is, in effect, penalizing consumers for utilizing a more efficient means of transaction. WTF? I can follow (but not necessarily agree with) the thinking behind charging fees for checked baggage or in flight refreshments. These things drive up costs. But not online booking.
What if other industries followed suit? Fees for online banking? For booking hotels online? For using the drive thru at restaurants? For pumping your own gas?
The parallels to live entertainment are obvious. I have often wondered why so few promoters and venues choose to flip the common fee arrangement on its head. That is, charge fees for a box office (ticket counter) sale but offer incentives (no fees) to purchase online. We have a couple of clients who do business this way, and their online sales represent over 90% of their total ticket sales. Self Service is more efficient.
If customers and computers are doing the work, it frees up your resources to grow the business. Our system is one of the few ticketing systems out there with the flexibility to allow venues and promoters to set the fee structure that their customers see (completely independent of the per ticket fees we charge for providing ticketing services). In essence, it empowers businesses to encourage the self service option.
It’s time for more businesses to embrace a shifting paradigm. Encourage the efficient transaction and grow your business the right way, instead of taking the easy route and squeezing your customers who self serve.
Oh, and Spirit, if you guys want to REALLY grow revenues, you should try an online check-in fee, a boarding fee, or even a “seat bottom cushion flotation device” fee.
Geez.
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