Archive for July 31st, 2010

Hot Summer, Cold Economy, Weak Concert Sales

By BEN SISARIO
Published: July 30, 2010

There was plenty of room for the barkers in sandwich boards to make their way through the crowd at Lilith Fair’s tour stop this week at the Susquehanna Bank Center in Camden, N.J.

“Last call for $10 Maroon 5 tickets!” one shouted as he crossed the amphitheater’s sparsely populated lawn, his sign advertising deep discounts for a forthcoming show; regular-price tickets cost up to $65. But the fans at Lilith — a revival of Sarah McLachlan’s woman-centric package tour from the 1990s — weren’t buying.

For the concert business it has been a summer of hard sells and empty seats. Despite sellouts for Lady Gaga, Justin Bieber and some other hot acts, overall sales have been suffering, with prominent tours like the Eagles and “American Idols Live!” canceling dates.

Live Nation Entertainment, the leading promoter, has been trying to fill seats with fire-sale prices, and in a recent presentation to analysts its executives promised that grosses in 2011 — when stars like U2 and Christina Aguilera are scheduled to make up shows they postponed this year — would improve.

But while superstar acts draw headlines, the fortunes of the wider business are just as reliant on the steady drawing power of a much longer list of midlevel performers. And interviews with fans at two summer concerts at New Jersey amphitheaters this week — Lilith, in Camden, and the Goo Goo Dolls, at the PNC Bank Arts Center in Holmdel — revealed some of the industry’s fundamental problems, including the basic head-scratcher of $10 tickets and $13 beers.

As with many of its shows this summer, Live Nation offered a range of discounts for the Goo Goo Dolls. In June it waived most (but not all) of the surcharges for its amphitheater seats. When large numbers of tickets were still left unsold, it began offering $10 tickets for shows on some Wednesdays. Those promotions are expected to continue, but some in the business question whether the pattern of high initial ticket prices falling to loss-leader levels in the days before a show is training some consumers to avoid full-price tickets altogether.

“How are we going to get people to buy tickets ahead of time next year when there’s so much deep discounting going on right now?” said Kevin Lyman, promoter of the Vans Warped Tour. “At the venues they’re hawking $10, $20 tickets, and you see the kids saying, ‘Wait, I paid $40 for that ticket.’ They’ve lost the trust of the fan.”

For big tours, most of the money earned through the base price of a ticket — before surcharges — goes to the artist. So Live Nation can afford to discount its tickets because it makes far more money through parking, food and other concessions, and through those fees. At the Goo Goo Dolls show, beers were $11 and $13.

In a survey of a few dozen fans, most were unaware of the ticket discounts. But Jay Milos, a corrections officer from Randolph, N.J., said he had made sure to wait for the right day to avoid paying a $12.50 fee on his $43.25 ticket.

“It’s a scam, the service charges and the fees,” Mr. Milos said. “It would be smarter for them if they always sold them without those fees and then supplemented their income with advertising on the site.”

Not everyone in the concert industry is seeing doom. Dennis Arfa, a veteran agent whose clients include Billy Joel, said that while there had been some problematic tours, plenty have been doing well. (Mr. Joel’s most recent tour with Elton John, for example, grossed $108 million for 42 concerts.)

“Yes, there are some tours not doing well; yes, there are bands that don’t belong out there,” Mr. Arfa said. “But as a whole, this happens every summer. Things aren’t as bleak and dismal as they appear to be, but the media falls in love with a story — everybody wants to shoot Goliath.”

Pollstar, an industry trade magazine that reports ticket grosses from promoters, said sales for the Top 100 tours were down by about 17 percent so far this year from the same period last year.

Attendance at the Goo Goo Dolls show was about 75 percent of the 16,000-person capacity. But at Lilith Fair, which has canceled 10 of its originally scheduled dates, the turnout appeared to be far lower, with about half of the inner theater’s seats and much of the lawn unoccupied (capacity is 25,000); Live Nation has not yet disclosed grosses or attendance figures for those shows.

The weak economy is widely cited as a likely cause of poor ticket sales; base ticket prices as high as $200 don’t help. But many agents, managers and promoters, as well as Wall Street analysts, also worry that an overcrowding of talent in the marketplace and extreme changes in pricing can alienate consumers in the long run.

For lawn tickets to the next Lilith Fair stop, at PNC Bank Arts Center on Saturday, for example, the regular price is $37.75. Live Nation was also offering a special deal of a pack of four lawn tickets for $75; with service charges they cost a total of $112.20. But on Wednesday, when the company’s latest sale took effect, those same four lawn tickets were $40 flat.

With record sales down by more than half over the last 10 years, artists have increasingly turned to touring for their income, leading many to tour too often, some say. That wasn’t the problem with the Goo Goo Dolls, who are on their first wide tour in three years, or with Lilith. But it is the case with many artists this summer. The band Creed, for example, is returning to many of the same amphitheaters where last summer it played to crowds as low as 27 percent capacity.

“The problem is that artists have been incentivized to tour more often, and they lost that scarcity factor that had been supporting ticket price increases,” said David C. Joyce, a media analyst with the firm Miller Tabak.

For Lilith Fair the problems may have more to do with a simple lack of demand. The lineup, which includes, at various points in the tour, the Indigo Girls, Cat Power, Suzanne Vega and Mary J. Blige, has been criticized as being too conservative. Kelly Clarkson, a major draw for younger fans, dropped out of the tour to work on a new album.

At the Susquehanna Bank Center, on a hill by the Delaware River that overlooks the skyline of Philadelphia, the lineup was particularly impoverished: besides Ms. McLachlan, the only other major headliner was the Court Yard Hounds, a Dixie Chicks side project.

Stacey Vey, who owns a bar in Philadelphia, looked over the light crowd at dusk.

“This is supposed to be one of those things you do this summer if you’re a lesbian in Philly,” she said. “You go to a Phillies game, you go to Lady Gaga, you go to Lilith Fair.”

Next to her, a friend, Elizabeth Pellerin, a homemaker in Medford, N.J., said the Lilith Fair tours in the ’90s were packed. She added: “You could say it’s the weather. However, it’s nice.”

Source: NY TIMES