Slumping tour biz heads for crucial fall
By the close of business Wednesday, concert promoters across the country will know how many Internet-savvy baby boomers are hungry for the music of a generational hero, Bob Dylan.
Dylan, whose “Love & Theft” album will be released Sept. 11, is taking a page from other mega-sellers such as the Backstreet Boys and U2: A limited number of tickets for 32 North American concerts will go on sale at the same time Wednesday for fans who follow his activities on the Web site BobDylan.com.
Although Dylan has toured relentlessly since the release four years ago of the album “Time Out of Mind,” which won three Grammy awards, this marks his return to arenas and major cities after playing state fairs, small colleges and foreign territories.
His is one of several fall tours that promoters hope will boost the sagging concert industry that has seen a 15.5% dip in ticket sales from last year among the top 50 touring acts, according to Pollstar, a trade publication for the concert industry.
In the last two years, the concert biz has undergone a revolution, thanks to soaring ticket costs, a slew of star cancellations, unfounded optimism in booking newcomers and a change in the economic structure of dealmaking.
For full-year 2000, the average ticket price was $43.75, which rose 7% to $46.69 in the first six months of this year.
In the meantime, “The volume of artists touring is down 10% year to year,” said Rodney Eckerman, Clear Channel Entertainment co-CEO and prexy of music. “It’s a long-running trend; if you go back to ’94, it was a very strong year, but ’95 slipped a notch. This year has some very strong superstars, but we don’t really have the depth in lineups in terms of sheer volume.”
Before the year is written off based on the summer results, however, there is some hope in the fall beyond Dylan’s Oct. 5-Nov. 24 tour:
- Surrounding the Nov. 6 release of her third album, Britney Spears has a 31-date North American arena tour beginning Oct. 26 in Miami.
- U2 will be on a second leg of 25 U.S. dates.
- Maxwell, who has scored a coup by adding the hottest new artist of the year, Alicia Keys, as his opening act, plays the East Coast and Midwest in September and October in support of his Columbia album, “Now.”
- Perennially hot Neil Diamond will perform at least 45 shows between Sept. 28 and Christmas.
- British critical fave Travis starts to take wing in October on its first headlining tour of midsize halls, a necessary stop in a rock band’s career trajectory.
Yet while the summer boasted Madonna and Janet Jackson tours in which “sold out” signs were posted minutes after tickets went on sale, there were also Rod Stewart or Dido dates that were easily one-third empty.
Some also worry that the touring industry is trying to wring too much money out of unproven artists on the road.
“People are trying to move these acts into big rooms too fast. You’ve got a whole bunch of new acts that have one hit single that drives album sales, and they think, ‘We should be able to sell a lot of tickets,’ ” said a touring industry vet. “But the kids are a little bit smarter than that.”
That makes for a highly erratic box office. A week after selling out 62,000 seats at Pasadena’s Rose Bowl on July 20, ‘N Sync was able to fill only 29,000 of the 38,100 seats in the Sam Boyd Bowl in Las Vegas. The difference in the gross: $3.1 million vs. $1.3 million.
The concert business has always been based on simple math: The artist requests a guarantee; the promoter figures out production and advertising costs, adds the numbers together, puts in a buffer to get a profit with less than a sellout — and then divides total cost by the number of seats to set ticket prices.
The new math is different: It starts with the artists determining how much they want to make over the course of a tour. This changes all the finances for the promoter — and for the fans.
The Rolling Stones, but few others, had taken this approach; suddenly, it’s de rigeuer for anyone capable of filling a basketball arena.
“It’s sort of the tail wagging the dog,” said one touring industry vet.
“You never really know what the proper price point for a concert will be — it’s really difficult to predict,” said Gary Bongiovanni, editor of Pollstar. “No one knows what the ceiling for ticket pricing is at this point, and it varies from act to act.”
This summer, Madonna led the way by getting $250 for the premium seats and $128 for half of the seats in every basketball arena she played. U2’s choice chairs went for $135, Janet Jackson topped out at $125 per seat, and Aerosmith ducats set fans back $85.
Some acts have paid a price.
In late July, Eric Clapton was 3,000 seats shy of two sellouts in Chicago’s United Center; Janet Jackson played to 11,000-plus fans in Columbus, Ohio, and 2,000 empty seats; and at the enormous HersheyPark Stadium in Pennsylvania, Destiny’s Child was able to fill only half the nearly 30,000 seats.
“We at least need to be smart enough to identify who is buying tickets,” John Meglen, co-CEO of Concerts West. “We have to understand not only discretionary income but also discretionary time.”
Sticking with the Chicks
One touring-biz vet singled out the Dixie Chicks as an act that has made the right moves. The Chicks toured with George Strait and then Lilith Fair; once they headlined, they kept ticket prices reasonable. The group has delivered a loyal and diverse fan base.
As for Aerosmith, the group “is so solid today because they were able to grow up with their audience — and they priced things accordingly,” the vet explained.
On the flip side, he said, is the Backstreet Boys, “who might have gone for too high a price too early in their career.”
The Backstreet Boys — which would have certainly filled 18,000-seat arenas every night this summer had they not taken a seven-week break for A.J. McLean to complete a rehab stint — will certainly see some of their receipts spill over into fall.
“We’re just glad the fans are still there,” said one member of the Backstreet team, showing some concern that teen pop may be on the wane.
If it is, the next trend could be the type of R&B music that Destiny’s Child has popularized. Their tour, which has consistently sold 85%-90% of capacity, usually in venues of 8,000-10,000 seats, has the added benefit of significant MTV promotions.
MTV, which presented U2, ‘N Sync and Staind this year, took it a step further as Clear Channel assembled a TRL Tour starring Destiny’s Child and featuring Dream, Eve, 3LW, Nelly and Jessica Simpson. Cost to the Viacom-owned channel: Nada.
“It wasn’t until this artist package was conceived that we said yes,” noted Tina Exarhos, MTV senior VP of music marketing.
“This package is a good representation of the music heard on the show, and it took our sponsorship activities to a new level. But we’re not promoters. This is about music marketing, and we’re careful about things like ticket prices. We had a dialogue with SFX (now Clear Channel Entertainment) to make sure tickets would be reasonable. We don’t want people to think we’re gouging them.”
So once again — blame it on the promoters.
Clear Channel “has added on to ticket prices so many surcharges that all of a sudden you’re paying $200 for a top-tier ticket,” said Johnny Podell, a partner at the booking agency Evolution Talent Agency. The firm handles Backstreet Boys, ‘N Sync, Limp Bizkit and Britney Spears.
“Even in my family, there’s only so much you’re willing to pay before you have to say ‘no more,’ ” he added.
Those surcharges — passed on to the consumer as facility fees, service charges and convenience fees — have been used for two decades to circumvent the amount of money that is split between the promoter and the act.
No matter how high the final tally reaches for each concertgoer, Clear Channel’s Eckerman said the key is “right-pricing” an event.
“The Madonna tickets sold out in minutes, so on that tour we probably didn’t charge near enough. I don’t believe concert tickets are overpriced relative to comparable experiences — a Madonna ticket was no more than courtside seats to the Knicks or a hot Broadway show.”
(His comparisons are a bit off: The best seat in the house at “The Producers” is $99 and Knicks courtside seats are $1,600 each.)
“The problem is, we’ve lost sight of what the public pays,” Meglen said. “We’ve just got to get smart again about tailoring pricing to the target market.”
The exorbitant prices — a $2,500 top — for Michael Jackson’s all-star extravaganzas at Madison Square Garden Sept. 7 and 10 concerned his brothers Jermaine and Randy so much, they said they wouldn’t show. They have since vowed they’ll be back on the bill for a Jackson 5 reunion.
Summer’s concert woes could be quickly forgotten — does anybody still talk about the film B.O.’s soft spring? — if the fall travelers sell through the roof.
Growing up on concerts
And in a year or two, the young fans who have grown up with the likes of Backstreet Boys and ‘N Sync will be onto other bands, and concertgoing will still be part of their social calendar.
“It’s quite possible that these teen acts will grow up and mature; the acts that write their own songs will probably have an audience that will travel with them,” said John Scher, a concert promoter in the Northeast for nearly 30 years who recently left his post as the head of Metropolitan Entertainment. “It’s the first time in a decade in which kids are going to shows. And hip-hop has finally crossed over, opening up the vision of what it can be in concert. I see a lot of musical health.”