Live Nation’s highly touted discount ticketing deal with Groupon, called GrouponLive, has yielded impressive sales, during what was an overall solid financial quarter, the company said today, August 8, during an investor conference call.
The company has sold 422,000 tickets so far through GrouponLive, and more than 1,200 artists, teams and events have signed up to release offers, according to Michael Rapino, President and CEO of Live Nation. In total, GrouponLive has sold more than 600,000 tickets, but nearly 200,000 of those tickets are not from Live Nation.
“We’re very pleased with its progress,” Rapino said.
Live Nation Chairman Irving Azoff added that while a lot of artists detest the concept of last-minute ticket discounting, Groupon is a “buzz word” that those same artists appreciate. “Artists are buying into it,” he said, because they are realizing that a lot of those who are purchasing the offers are new fans who may be interested in going to more shows.
For the company’s second quarter, which ended June 30, revenues grew more than 20 percent and reached $1.56 billion, compared to the same period in 2010. Live Nation recorded a profit of more than $13 million for the quarter, compared to a loss of more than $32 million for the same period.
Last year was a tough one for Live Nation, so this year the company decided to produce fewer shows but bump up prices for a lot of them, and even with the increase in price, Rapino said that fans are spending the same amounts on concessions and merchandise as in past years.
“We saw strong walk-up business in July, so it appears that consumers are still doing whatever it takes to see the shows they want to,” Rapino said.
The improved financials are primarily due to an increase in ticket sales for the quarter, despite the still weak economy, for which sales are up 15 percent and attendance is up more than 6 percent compared to the same period in 2010.
Even with the increased sales, Live Nation’s stock, which trades under the symbol LYV, was not immune to the decimation of the financial markets today, as shares closed down more than 6 percent to $8.78.
One area where Live Nation expected to be more of a factor in the second quarter was in its new dynamic ticket pricing initiative, which the company hoped would be further along in the quarter.
Rapino said that the real rollout for the program will be in 2012 following tests this fall.
“The sports side is the easy side to sell because a lot of teams are already familiar with the concept,” he said, adding that he expects about a dozen teams will be signed up in the fall.
Dynamic pricing, similar to what airlines do, changes ticket prices on-the-fly based on various criteria, and Rapino admitted that it has been a slightly tougher sell to artist managers for the concert market.
“We’re going to guinea-pig it ourselves using managers we’ve worked with before and hold their hand through the process,” Rapino said, adding the company hopes to test dynamic pricing on 10 shows during the fall.
Azoff said overall the company is meeting with generally positive response from artists. “Every major artist understands the upside of this.”
