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Stuff that does not yet have a home.

Paperless Tickets Driving Wild Pricing Patterns

Paperless Tickets Driving Wild Pricing Patterns

Used to be that ticket prices would consistently fall in the days leading up to a concert event. As paper ticketing has become more prevalent, there are signs that ticket pricing patterns are more volatile as events grow near. I propose that those changes are a direct consequence of paperless ticketing, the device that was intended to curb ticket resale (what?). Data compiled by Brady Fowler show some patterns that support this notion. In reading the analysis on the linked article, U2 and Rush experience near show time price spikes, while Taylor Swift and the Rolling Stones show wild fluctuation in ticket price in the days leading to show.

In the last couple of years I have experienced the influence of paperless tickets in a two specific instances and one general case.

Taylor Swift 1989 Tour: I attended both the San Diego and Atlanta shows (my wife is a big TSwift fan). In San Diego, I waited until 30 minutes before show time to buy two general admission standing only tickets by the front of the stage for 150% of face value. This was from a street scalper who had the tickets listed on StubHub at the same time I was negotiating the purchase. At the Atlanta show, I waited until two hours before the show before caving in on a pair of loge level tickets that had been at 200% of face value all day.

Meghan Trainor Tour at Blue Hills in Boston: 30 minutes before show time, I purchased 2 paper tickets from a street scalper at 40% below face value. Meanwhile, SeatGeek listed slightly less desirable tickets for immediate download at about 90% of face value.

Generally, it’s not unusual to use the resale market to attend concerts on a last minute basis. I will do this if I can find last minute tickets well below face value. Used to be really easy when paper tickets were in effect, but with paperless available from most of the popular ticketing apps, I have to be ready to buy very close to show time, nearly committing to attend before I have a ticket. Consequently, I have not been able to see as many shows lately.

By no means is this quality research, but I think there is something to the observation. Perhaps a scholar somewhere is working on this very question?

 

Q&A: Best Time to Buy on the Street

Q&A: Best Time to Buy on the Street

This post is in reply to a message from my email bag. Elie asks the question, “How late may I show up after the face-off of an NHL game and be able to grab cheap tickets?” This question was asked in follow up to my article titled “Buying from a Scalper”.

This question is a bit tricky. The best time to buy a ticket from a scalper at any event – regardless of the kind of event – is dependent of a few variables. Each variable has some unique advantages and challenges.

1. Event location: if one is in Boston, you have the likelihood of more resold ticket availability and therefore the opportunity for more leftovers after the event begins. If you are in a smaller city like Tulsa or Reno there may be a lower quantity of resold tickets to choose from. If I am in Boston looking for tickets to a Bruins or Celtics game, I can be sure there will be some tickets to choose from after game time and that the scalpers will want to sell tickets at enticing prices. In Tulsa the demand for resold tickets could be lower and therefore the number of tickets available for a game post-start are going to be less. What this really comes down to is scalpers are in business and they like to have a product to sell for every event they can. In Boston, there are more scalpers and therefore the potential for more inventory. Tulsa, less so.

2. Team rank: team ranking effects both price and availability. If the Sharks play Dallas in San Jose, expect more options after face-off. Visa-versa, less options. Of course, there may be a lot of devoted sports fans in Dallas, that could drive availability.

Other variables to consider are weather, early in season, and late in season games. Sometimes the masses decide to go to a game because it is a great day for a game and sometimes the wild card is at stake.

I could not profess to know the dynamics of every market – I don’t. What I do know is if you try to buy for a game that is less important to you, you will gain an understanding of how to buy when it matters. I once bought tickets for a Cubs game on the street; there were plenty of seats options during the first inning at fair prices below face value. I then went to a White Sox game and found a small quantity of grandstand tickets for $15 and a few really good tickets for $80 in the second inning. $80 is not a good deal for White Sox tickets!

Elie – your specific question was about Toronto. Canada loves its hockey teams. If you are shopping in Toronto, I would suppose the best values are ten minutes before to ten minutes after because scalpers snap up those tickets in droves. If they play away, take into account who they are playing.

Now that fansnap.com and seatgeek.com are in full swing, I would advise buyers to check both of these sites to check availability and price 24 hours before the game. The more tickets and price options you see, the better chances you have of getting a deal after face-off/tip-off, etc. The less options… well, you get the idea.

Ticketmaster’s Net Down 70%: Good News for Fans

Ticketmaster’s Net Down 70%: Good News for Fans

This past week, TicketMaster reported it’s second quarter earnings were down seventy percent (70%!). This news combined with recent reports that resold ticket prices for popular acts are selling well below face value means it is ‘super value ticket’ time for fans. Here are a couple of pointers for playing into these market dynamics.

First, if you prefer to buy from Ticketmaster or Live Nation and do not see the seats you want onsale right away, return to the site seven to ten days before the show and you may find a decent pair of tickets at face value, plus the ridiculous fee’s. You may have to come back to the site a couple of times as ticket inventory can change daily, sometimes hourly. For example, on August 5th at 5pm I bought a 7th row ticket at face value from Live Nation for the August 6th Coldplay Show in Raleigh, NC (here is some video I snapped). That same ticket was not available at 3pm. I paid $126 (fee’s included for my seat) and the guy I sat next to had paid StubHub $170 for each of his four seats bought two months before.

Second, if you are a bargain hunter or last minute planner, the secondary ticket market is a good place to look for last minute deals. If you are buying online from a reseller like StubHub, TicketNetwork or RazorGator, I strongly recommend buying at least two days before so you can be sure to get the tickets overnighted. But if that is not enough last minute for your style, you can always just show up to the venue an hour or two before showtime and go hunting. The best way to find deals on tickets at the event is by strolling the tailgate parties and asking or looking for people who have extra’s. At the Coldplay show I mentioned earlier, I saw at least two dozen tickets on sale for anything from face value (without the fee’s) down to 50% off. People really worry they will be stuck with an unwanted ticket so there is always room for negotiation.

Finally, there is a really cool site I recently found called fansnap.com. The site scours ticket resale sites and organizes available inventory by price and seat location. It is super easy to use and free. I’m actually pretty bummed because they beat me to getting the idea launched, but hey, they did it so kudos to them.

As the secondary ticket resale market continues to grow, I am pretty confident that stories of $10 and $20 tickets will become more common. They are hard to come by, but they happen. So, as Mr. Miyagi says, “patience Daniel-son, patience.”

Where is Dynamic Ticket Pricing?

Where is Dynamic Ticket Pricing?

In the July 2009 issue of Rolling Stone, Steve Knopper points out that average concert ticket prices have more than doubled in ten years from $32 to $67. While the increase in ticket prices is not always pleasing to concert goers, the more pressing issue is that of ticket mis-pricing. Simply stated, concert tickets traditionally have a face value that is based on a guess, and a poor one at that. This means that some tickets are priced too low and some too high. Mis-pricing tickets is a disservice to fans in that under pricing good tickets increases opportunities for scalping while over-pricing lower quality seats can cut out budget conscious buyers. Given the technology and data analysis that is possible, why is it that more dynamic ticket pricing has not come to fruition?

Irving Azoff, CEO of Ticketmaster has proposed that concert ticket prices should be more dynamically priced, but he side steps responsibility by suggesting that artists and promoters need to take the initative. Indeed, ticket prices are established by artists and promoters and Ticketmaster has historically not had a lot to do with the actual pricing of a ticket, but that is only because after selling billions of dollars in tickets, the company can’t seem to use all the data it has collected to offer dynamic pricing services to artists and promoters. Who else is best suited to provide dynamic pricing than the company selling the tickets? I can only speculate that Mr. Azoff prefers a broken system that allows them to assess hefty fees on individual ticket sales.

Dynamic ticket pricing is needed now and it could benefit the market in two ways. First, it would reduce the number of tickets resold on the secondary market because dynamic pricing would reduce profit potential at resale. Second, dynamic pricing could increase ticket sales volume for events where interest was low. It seems plausible that some concerts are under attended because lower quality ticket prices (with fee’s) are not enticing enough. This is probably why Live Nation is putting so much effort into selling lawn seats for $25 with no ticketing fees – that kind of price entices people to buy.

Note: Rafi Mohammed gives a little more information on dynamic pricing and issues surrounding the concept in this article.

Re: Is Scalping All That Bad?

Re: Is Scalping All That Bad?

Last week, Mark Gimein wrote an article titled “Is Scalping All That Bad?” that touched on both the politics and economics of ticket scalping. While the article raised new thoughts about old issues, it failed to address the question posed by the title. I argue that the question is not the right one. It is not about whether scalping is “good” or “bad” ; that is one of those questions they ask in business school that has no right or wrong answer. The more interesting question to ask is: if ticket scalping is a problem, why are primary ticket sellers (such as Live Nation and Ticketmaster) supporting and engaging in the practice?

The general public and primary ticket sellers alike have a love-hate relationship with ticket scalpers, one that is entirely based on the perceived beneficiary of a given scalping transaction. If a fan gets a ticket from a scalper at the last minute for a ‘fair price’, scalping is good. But, when the popularity of an event drives resale prices high, scalpers are bad for profiting from basic economic theory. On the primary seller side, Ticketmaster is happy to use ticket resellers to clear out inventory or gain from resale profit, but they blame scalping practices when CNN runs a story suggesting that the parents of a 12-year old Miley Cyrus fan might have to pay $2,000 for a front row center ticket to see a sold out show. Never mind Ticketmaster is gladly offering a similar front row seat for $2,605.

Ticket resellers are not the enemy; they are a service provider. They would not exist without a large market of buyers – people like you and me – who don’t want to admit we use scalpers to solve our lack of planning (making time to buy a ticket or not buying until we know we can go). Someone was silly enough to pay $2,000 for a Miley Cyrus ticket, and though that is alarming, the facts are that her average resale ticket prices on StubHub in 2007 were $257. Either way the blame for this should lie with Miley’s management and Ticketmaster – not the ticket scalper. Two simple facts support this truth.

First, artists, promoters and Ticketmaster support scalping by holding back better tickets and selling them for a much higher price. In other cases they reduce available ticket inventory by holding them back for promotional purposes (sometimes up to 20%). Combined, these actions both reduce available ticket inventory on the primary market and increase perceptions of short supply, which enables higher resale pricing.

Second, as scholars have noted (Courty and Atkinson), most event tickets are artificially priced low as a service to fans – a decision made by both promoters and artists and rubber stamped by primary ticket sellers. This alone is a key reason why scalping is so widespread: under pricing creates a market for resellers to profit from mis-pricing.  If Miley Cyrus, Trent Reznor, or any other artist wants to do a service to their fans, it is letting the better seats price to what the market will bear and not some artificially low price that invites scalping. Yes, some of the better seats will have to sell for $200 and not everyone can afford that, but not everyone can sit in the front row.

To be sure, ticket resellers can make supply appear to be scarce and position their tickets at higher prices, but they need the primary market to deplete supply for this to work. Ticketmaster and Live Nation do exactly this by queuing 50,000 people for 10,000 under-priced seats at the same time with little economic diversification, making it easy for buyers to cheaply acquire tickets for resale.

It is fair to question the size and scope of ticket scalping, but it’s not useful to cast scalpers as villains. Instead, everyone should be calling on Ticketmaster and Live Nation to take a genuine leadership role in developing ticketing solutions that reduce the potential for scalping without limiting a buyers options. Ticket sales are comprised of a fluid combination of elements including price, seating preference, the attendee’s knowledge of their schedule, weather, and microeconomics. Primary market selling methods should provide buyer’s with options that take these pricing influences into account- not force them into a no-way-out transaction like paperless ticketing just to take a hit a scalping.