- San Francisco Giants block Oakland A’s from San Jose
- Live Nation ten year class action lawsuit settles
- Barclays Center chooses Ticketmaster to manage ticketing needs
- Technology and Industry Leaders to Speak at Ticket Summit
- NFL looks to improve fan experience with Wi-Fi
- Broadway sales up $2 million despite closings
- Justin Bieber announces Believe tour dates
- 'Newsies' calls Broadway home indefinitely
- Brooklyn's Barclays Center sits atop venues rankings months before opening
- Indy 500 will be ultimate test of IndyCar changes
Guest Commentary: The death of the ticket broker
Twenty-two years ago, the way ticket sellers made money was to get on the phone and call other ticket sellers (brokers) to find out who had what, so they could quote some tickets to their clients. They wrote the information on a piece of paper and used something called a "rolodex." Those were the days when it was good to know "a guy" that could get you tickets to that hard-to-get-to event.
The natural progression of making that process easier through technology in conjunction with the rise of online sales was ultimately the cause of death for the "ticket broker." Much in the way the travel agent became a dying breed, the ticket broker was soon to become instinct as well, if he could not adapt and recreate himself.
At first technology made communication easier for ticket brokers as they created their first wholesale (internal) exchange called Ticket Trader. Anybody remember "Marty"? He created the first known wholesale exchange in the ticket industry. It was easy. You would list your ticket on the system, as every other ticket holder did. The system synched everyone's data (that was a big deal back then), and then you had access to hundreds of thousands of tickets, instead of whatever tickets you had in your hand. There were restrictions in being able to list your tickets on Ticket Trader. Marty policed it well as to not let everyone in who wanted to become a ticket broker; he attempted to keep the value of our industry high.
Then things sped up. The problem was that the average ticket broker could not keep track of or tabs on how fast the technology was advancing and in which direction. It wasn't going to be long before something or someone would come along and replicate Ticket Trader, make it better and, worse yet, open it to the public.
Marty saw the writing on the wall. He sold Ticket Trader, which at the time must have had somewhere in the range of 300-400 users, to a company called "Openfield," aka Razorgator. As this was happening, another company was already planning on taking what Ticket Trader had done and making it accessible to the public at large. You may have heard of them: StubHub.
Now no ticket broker would have believed that the day would come that their "loyal" clients would end up doing what the broker was doing all along — get in the business of buying and selling tickets. But it only made sense that they would and StubHub made it easy. They now had transparency, control and market share.
The industry wasn't regulated. Ticket brokers were at times making 100% to 500% on mark-ups without question. The public exchange would be the buyer's best resource in putting that to check. The buyer now had transparency to the actual market value of a ticket in this public exchange and thus became a more educated buyer. Loyalty vs. saving money — saving money wins.
The public exchange was a game changer for the secondary ticket market. Now suddenly the actual market value of a ticket became clear. No need to go to a broker anymore unless they actually held the tickets, which is one of the two ingredients required today to have a successful ticket company.
The second requirement is having a comprehensive online marketing department, an SEO-friendly Web site, social network development, and more. Pay Per Click became a mixture of art and science with very thin profit margins that made it very hard for the newcomer to break through.
Not to digress, but soon there were more exchanges and ultimately affiliate programs from those exchanges to capture more of the online market share. In short, the days of brokering tickets was done, with the exception of a few events where you can't list seats on an exchange, like your World Cups and awards shows.
The stark reality was the ticket reseller either had to have their own inventory of tickets in a niche market to be identified within or have a comprehensive online campaign. The ticket brokers who chose to adapt and started learning about the Internet and online marketing had a learning curve. Some managed to survive and recreate themselves — those that didn't died — and the new face of the online ticket seller emerged.
A bite more tech savvy then he had ever envisioned or hoped to be, but still alive.
Amir Khalighi is the president and CEO of TicketPlatform.com, a leading company in custom Web site and application design in the ticket industry. For the past four years, Ticket Platform has been providing hundreds of subscribers with affordable, user-friendly and SEO-friendly ticket sites in addition to helping them with their online marketing and social networking development.
Updated: Monday, October 3, 9:37 a.m. (EDT)


Subscribe to this feed
Comments
All comments are subject to TicketNews' community rules.Post new comment +
Interesting comments to say the least, some strong opinions here and I suspect some personal resentment as well towards the Author. Regardless, All the comments have merit in my opinion.
Just my 2 cts:
The machine as I like to call them Stub Hub, Ticket liquidators and Ticket Now, none have inventory, but one must concede their business model is genius. They set the market and brokers must under bid, market better(TOO expensive) or create their own business model and let it grow which takes time, patience and money. It is my opinion that to be successful in this business, one must have all those characteristics plus build a large customer base which may mean high volume low profit margins at first.
It is still all about buying a product for less than you sell it for. Like I said before, the margins are not as high as they were before the exchanges were made more public. And for those brokers, yes, their way of doing business may have died. But not for all. Some people are better at at figuring out the margins than others and making it work for their customers (I can almost always beat the total overall price someone would find for the same tickets on Stubhub, Ticket Liquidator, or Tickets Now) and still make money. Some customers prefer the personal service and guidance I can give that the larger websites cannot give. Some people like dealing with a broker that they know and trust rather than just a website that will forward their order to a broker of unknown character.
"Marty saw the writing on the wall. He sold Ticket Trader, which at the time must have had somewhere in the range of 300-400 users, to a company called "Openfield," aka Razorgator."
Not quite. Marty's Ticket Trader merged with MasterBroker & Openfield & MasterBroker, with the combined operation takng the name of the latter. RazorGator only later acquired control of Openfield.
"As this was happening, another company was already planning on taking what Ticket Trader had done and making it accessible to the public at large. You may have heard of them: StubHub."
Again, not quite so. StubHub was originally conceived as an eBay for tickets only auction site for the use by straights. It was only after brokers began surreptitiously listing on StubHub, and SH discovered that allowing such under the guise of "Large Sellers" was where the real money was, that SH took off.
Firstly, the touted transparency of the on-line market is both illusory and deceptive for 3 reasons:
1) The listings there are saturated with phantom ones, which artificially inflate the apparent supply and distort prices;
2) "Fan" listings are unreliable in all respects; and,
3) Absent access to the broker-to-broker boards, none can ascertain the true wholesale price.
As for the need to hold inventory, the author here contradicts himself by claiming that such is now a necessary condition for a broker remaining viable, while citing StubHub as an example of success in the new marketplace. The fact is that the most successful sellers, such as StubHub, TicketsNow and TicketLiquidator hold virtually no inventory.
While technology has changed the playing field, the fact is that the art of brokering between buyer and sellers remains alive and kicking.
If you read the article it looks like he's saying times are and have been changing and we need to adapt, thus the "death" reference. He sold his company for millions to a rollup company and his web site marketing firm looks like it's doing pretty well. It's nice to see one thing that has stayed the same over the years and that is the distain some of my fellow ticket sellers have at the success of one of their own. The crab theory is "alive" and well in our community.
The market has changed, yes, and margins might not be as high, but the "death" of the ticket broker? That is not our experience at all. It is just like any other business - if you have a good product, treat people well, provide good service, people will come back to you. Our sales continue to increase at a 35% rate each year. Some people want to have good service - something that Stubhub and Ticket Liquidator just can't and won't provide.
Lol, Here is a guy that failed at his brokerage so he opened a website design firm...tonnnns of money in that - NOT!
let's all listen to him
Well written article and good points. The industry has definitely changed and will continue to evolve as brokers battle Google SEO, and find new ways to find and retain clients as the mobile industry takes off.