- The Washington Times - Thursday, August 4, 2005

After last year’s plague of half-empty shows and dramatic last-minute price cuts, it looks like the concert industry has learned its lesson: You can’t charge outrageous prices for a subpar experience.

The concert business has managed to recover from last year’s lackluster second half through a combination of smart booking, innovative promotions and lower ticket prices. Although raw ticket sales are down this year compared to this time last year, analysts say the industry is actually healthier than it was in 2004.

Concert receipts in the first half of 2004 represented a gold mine for artists and promoters. The year’s top grossing acts — Madonna, Prince, David Bowie and Bette Midler, among others — toured early and made huge profits.

But in May, the bottom fell out.

Angered by exorbitant ticket prices — the average price for an Elton John concert was $158, the average price for Madonna was $144, according to CNN — consumers stopped coming out to shows. Summer amphitheater tours didn’t fill to capacity, tour dates were canceled, and promoters had to eat the costs.

“It was a combination of high ticket prices, too much stuff out at once and less than compelling tours,” Ray Waddell, senior editor of touring at Billboard Magazine, says of the 2004 concert season.

This year, attendance is more stable because ticket prices are more reasonable and there are more quality acts on the road, according to industry analysts.

According to the Billboard Boxscore report, U.S. concert ticket sales are down about 19 percent from last year. However, industry insiders attribute lower sales to several outside variables.

For example, while the first half of 2004 was loaded with big-name acts, the superstars like U2, Paul McCartney and the Rolling Stones will tour in the latter part of 2005. There are also fewer concerts this year, so total sales volume is understandably lower.

Gary Bongiovanni, editor in chief of Pollstar Magazine, says the first quarter of 2005 was also exceptionally light because 2004 was so “terrible” that promoters were afraid to book shows.

“In terms of gross numbers, yes, the business is down and not an insignificant amount,” he says, “but there’s a world of difference between the market today as opposed to a year ago.”

Unlike last year’s tours, this year’s concerts are meeting projections, according to Mr. Bongiovanni. At least part of the credit for the recovery goes to vendors and promoters who are offering discount tickets, value packages and other incentives to draw in customers who were turned off by last year’s high prices and lackluster acts.

For the first time in 10 years, promoters have begun to lower ticket prices. According to the Pollstar 2005 Mid-Year Business Report, prices have dropped 6.1 percent from last year. Mr. Waddell says lowering prices has been essential because cheap tickets let people come to shows that they normally wouldn’t attend.

“For 20 dollars, you’ll go for the social aspect of it,” he says, “but you don’t experiment for 50, 75 or 100 dollars.”

Clear Channel Music Group, the largest promotions company in the world, has been offering discount lawn passes and package tickets to amphitheater concerts. Clear Channel Executive Vice President for Marketing Faisel Durrani says almost all of Clear Channel’s amphitheater shows offer a $20 lawn ticket or a $39 grass pass, which includes a lawn ticket, parking and a $10 voucher for food and drinks. Clear Channel has also begun allowing concertgoers to bring lawn chairs and blankets inside the stadiums.

“We have to increase the value proposition that we give the customer by decreasing the price and increasing the experience,” Mr. Durrani says.

The Vans Warped Tour, a punk rock tour now in its 11th year, has been widely cited as one of the most successful ongoing concerts. Founder and producer Kevin Lyman attributes the tour’s success to keeping ticket prices low and staying true to the type of music that fans want to hear.

“We don’t stray too far all over the place,” he says. “People know when they’re coming to the Warped Tour the type of music that’ll be featured.”

Although the Warped Tour has succeeded by staying true to a tested formula, many concert vendors are innovating successfully.

For starters, beer prices have been slashed by a dollar nationally. Many venues also set up interactive booths to promote new products at their shows. Ozzfest sets up a video game booth to entertain patrons during downtime. Some venues allow audience members to text message a central video board to communicate with friends at the show.

Various promotions have helped the industry climb out of last year’s slump, and lower ticket prices may help maintain sales, but ultimately success still boils down to the quality of the acts.

“You can’t trick people into it,” Mr. Waddell says. “What you want to have is great star artists that are great compelling performers live.”

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