If you’d asked me as a little kid how I’d be spending my New Year’s in 2011, I’d probably have said I’d be relaxing at my vacation home on the moon. Alas, that didn’t happen, but instead, I spent some time thinking about the 11 things you should be thinking about if you’re in the live entertainment industry as a marketer, secondary seller, box office person or program developer.
My view of the industry is broad because Goldstar works with venues in all genres and sell tickets all over the country. This gives me a perspective that could be helpful to others who might be focused geographically or by genre.
So with no further delay, the 11 for ’11:
11. “Bad” is the best case scenario for the secondary market. Also possible are “dismal,” “awful” and “nauseating.” Three things are causing this: first, the economy is causing most people to feel a greatly reduced need to spend $700 to see “Shrek: The Musical” or a Wednesday night game between the Columbus Blue Jackets and the Buffalo Sabres (that’s hockey, FYI). Second, primary sellers are pricing their inventory better. They got that idea from you, if you were in the secondary market a couple years ago. Third, StubHub and one or two other organizations are getting better at this than their competition.
10. People’s expectations just go up when times are tougher. When they’re flush, consumers will forgive mediocrity to some degree. When they consider purchases as carefully as the Nobel committee picks its prize winners, they want the show to be great. If an elephant, a monkey, and a guy in a funny hat were good enough before, you better bring two elephants, a whole barrel of monkeys, and a guy in a rainbow wig and Elvis costume now. It seems unfair that a less lucrative customer would be more demanding, but that’s how it goes.
9. Dynamic pricing is like the stuff in your rear view mirrors: Closer than it appears, but still not here. There’s good work being done in this area (by Qcue, for example) and widespread, algorithm-based dynamic pricing is coming to the live entertainment business in some form in the next few years, but for now, it’s still mostly half-baked consulting telling you to raise your prices $5 when sales go over 80 percent.
8. When you hear the words “social media,” mentally replace them with “Facebook.” The rise of Facebook in 2010 is like almost nothing I’ve ever seen in more than a decade in the Internet business, mainly because it’s a rise from an already pretty high level. For almost everyone reading this, your relevant audience is primarily using Facebook. When it comes to customer adoption, Twitter isn’t Pepsi to Facebook’s Coke. Twitter is RC Cola, and there is no Pepsi in this world. Foursquare is, well, whoever RC Cola people make fun of at company retreats.
7. Mobile is for real, but it still won’t make you any money. If mobile isn’t something you can do as an investment and as a customer retention/optimization tool in 2011, you shouldn’t do it. People are mostly going to use mobile for information gathering in 2011, though commerce is actually happening in a limited way in live entertainment on mobile devices. You just can’t expect this channel to start replacing computer-based buying for the moment, and if you need an immediate ROI of that kind, you shouldn’t spend your money. But you really should because adoption is getting pretty real on this. Believe me, you’re not the only one without something happening in this area, but the time really is now. Think back to e-commerce in, say, 1996 or 1997: too early, but really, just the right time.
6. Chew on the fact that food is now entertainment. At this moment, consumers see food as a form of entertainment, not as a way to power their bodies. You may think you’re competing with the theatre down the road or the other team across town or the other ticket broker offering tickets to those theatres and teams, but in reality, you might be competing with Cheesecake Factory. Sitting still and watching something for a couple hours has distinct disadvantages as compared to a full sensory experience of eating, especially if what people are sitting and watching for a couple hours is not so great. There are ways to make money from this if you can tap into it, but if you ignore it, someone else could eat your lunch, and they’ll probably have an arugula salad with a raspberry vinaigrette dressing as an appetizer.
5. Advertising basically doesn’t work. That’s not fair. It’s only print, radio and 99 percent of online and TV advertising that don’t work. If you want to do a fun experiment, take out a great big full page ad in your major metropolitan newspaper at rate card prices and see how much you can break your all-time record for cost per sale. You’ll be like the Brett Favre of bad marketing. If you’re not sure of the ROI on every program you’re doing and doubling down on the good ones, you’re almost certainly losing money by the Hummer-load.
4. In the future, they’ll make a VH-1 special about these times called “When Coupons Ruled The World.” In essence, discounts distributed through sites like Groupon have replaced local advertising in many industries, especially restaurants and personal services. While these can work for live entertainment too, the real question you have to ask of any discount program is whether it’s helping you build sales and audience over time. If so, then great. You can perhaps live with a lower ROI today, if you must.
3. If you can build a bond with customers, none of this bad stuff matters. If, for example, you’re a small ticket broker, you’re in a crummy overall situation, but if you’ve got an actual bond and deliver a value that your customers feel they can’t get anywhere else, you can simply refuse to participate in your industry’s crummy overall situation. I know guys who wouldn’t use Goldstar or Ticketmaster in a million years because all they want to do is pick up a phone to “their guy,” say what tickets they want and then have those tickets magically appear in their hands, and they’re willing to pay a pretty good premium for the privilege, even on tickets that aren’t particularly hard to get. That’s just one example of creating value for a customer in a personal way that basically insulates you from the worst economic environment since the asteroid that wiped out the dinosaurs.
2. Sing the chorus of “Brass in Pocket” with me: “I’m special…(special), so special (special), I got to have some of your attention.” Whatever you do in this business, your challenge right now is to be special (special), so special (special). Not to be bigger than Jesus, not to make enough money to buy a golden house; just to be something that the right niche audience is crazy about. Quick: what makes you special? Tick, tick, tick. If you still don’t have an answer, you need to get one.
1. The good news is that you’re still at the top of the pyramid: live entertainment. You’re selling the product that people REALLY want, which is being there. If they can’t afford it, can’t go, or don’t have time, they’ll settle for a recording or a video or reading about it on line or watching it on TV, but live is the real thing, which is why people pay more for it. Being there is bragging rights, an emotional high, being part of a tribe and getting up close and personal all rolled up into one. Being there is the difference between watching an episode of “Hawaii Five-O” and jumping into the waves in Maui. That’s the asset you’re working with. Use it for all it’s worth. Make it mean something that a person is going to a live event. Remind them why they care. Don’t take the fact that they’re paying big money to be there for granted. People used to pay for records, tapes and CDs too.
Jim McCarthy is the CEO of Goldstar, the leader in selling half-price tickets online. He focuses on business development through strategic marketing for Goldstar. He also serves as Chief Editor for Live 2.0, an online initiative to build understanding and awareness of the rising prominence of the Live Entertainment segment of the entertainment economy.