Most consumers understand the basic concept of supply and demand, and the role that it plays on the price people are willing to pay for certain things. This is very apparent in things like tickets to live events, where there is a specific limit to how many people can attend any one thing at a given time, which translates to people being willing to (or forced to) pay more to get one of the relatively limited supply.
But what happens when the consumer has no idea what the actual supply is, or is misled about that supply in order to prop up ticket prices artificially? Welcome to the thorny issue of ticket holdbacks.
Ticket holdbacks are an allocation system that has been common for about as long as tickets have been sold. Basically, holdbacks are tickets that have been set aside by event operators, artists, or promoters, and not offered for sale to the general public. They fall into one of several categories:
Artist/Performer holds: Tickets that are reserved from sale by the artist/venue/promoter in order to be distributed through means other than the general public sale.
Promotional holds: Contests for radio stations and other promotions have to come from somewhere.
Presale holds: Tickets set aside to be offered to various groups in presales – there are almost always blocks available through presales run by the promoter, the venue, local radio stations, the artist fan clubs, or the holders of credit cards that have brokered deals for their members to get special access.
There’s nothing inherently wrong with ticket holdbacks, in a general sense. But where it gets thorny for consumers is when holdbacks are weaponized by artists, promoters, and primary ticket sellers to prop up consumer prices.
Led to believe that tickets are seeing “unprecedented demand” or whatever other language the promotional marketing chooses to use to spur consumer fear of missing out, tickets go on sale and only see a tiny fraction of what is actually unsold go out at any one time. A show might “sell out” quickly, even when the implication of low supply has been used to justify surged “dynamic” ticket prices.
Then, remaining ticket inventory is slowly dripped out to the market in the time between the initial sale and the event date, keeping prices propped up because of continuing belief on the part of consumers that the event is sold out, except for this small batch that promoters just happened to find for release to the market, so they’d better buy (even if the prices are still outrageous).
Ticket holdbacks are pretty much universal. Artists known to have used them include top names like Taylor Swift, Ed Sheeran, Beyonce, Justin Timberlake, Bruno Mars, Adele, Bruce Springsteen, The Rolling Stones, The Weeknd… etc.
Despite the use of ticket holdbacks, promoters regularly blame other factors for the ever-rising ticket prices being charged by artists and event operators. “Bots” scooping up all the tickets, and “scalpers” buying tickets only to resell them are the universal bogey man according to promoters, but when the curtain is raised, it is usually held back tickets that are to blame.
Some examples: According to testimony by John Breyault of the National Consumers League before the Connecticut General Assembly in 2011 when that legislature was considering ticket reforms, including holdback disclosure requirements –
“At a 2009 Taylor Swift show in Nashville, Tennessee, only 1,600 of 13,300 tickets were made available to the public. This was not an isolated incident. Prior to the public sale date for a 2009 show by country music star Keith Urban, more than 10,400 of 14,900 tickets had already been sold. Thousands of these tickets were reserved for Urban’s fan club and American Express card members.”
A government audit released in Hawaii showed that over half of available tickets – in some instances as much as 93 percent – were held back from consumers, while “bots” played no meaningful role.
“Our findings show that many of these holds and presales are kept as inside information and, more often than not, the general public is unaware of the limited availability of tickets,” the report reads, in part. “Robot sales or bulk on-line sales do not have a significant impact on local sales or availability,” it reads. “We found that online resales, robot and bulk ticket purchases do not appear to pose a high risk to local ticket sales and availability.”
Former New York Attorney General Eric Schneiderman’s office published a comprehensive study on ticketing that came to similar conclusions – holdbacks are an enormous factor in consumer ticketing issues, and are directly responsible for consumers often believing events are sold out, or close to sold out, when they are far from it – triggering fans to purchase tickets at inflated prices. State Senator James Skoufis of New York recently pointed this out, directly in the wake of the Taylor Swift bruhaha, indicating his belief that there are probably thousands of tickets that remain unsold for the supposedly sold out Eras tour.
“Holdbacks are one of the dirtiest secrets in the industry,” Sen. Skoufis wrote in an opinion piece published in November. “It’s likely that at each of Taylor Swift’s 52 upcoming concerts, thousands of tickets will be “held back” and never released to the general public… Holdbacks should be banned or severely limited.”
Why haven’t holdbacks been banned or limited to this point? Largely because companies like Live Nation threaten any locality that tries to push for holdback disclosures. Artists, they say, won’t bother to play in a location that requires consumers know how many tickets are available at any stage of the ticket process. That’s what got officials in Ontario to abandon planned required disclosures on ticket availability in 2017, and it’s a recurrent theme any time the issue is raised in local legislation.
Even now, the lack of transparency on ticket availability is being used to push blame for high prices to everyone but the artist and promoter using holdbacks to prop prices up by limiting supply.
Despite claiming that “bots” and ticket scalpers were to blame for the massive failures of the Taylor Swift Eras Tour presale in November – and then claiming the entire tour was sold out to the point where they cancelled the planned general public sale entirely – there are somehow still tickets still being dripped out onto the market as shows approach. The Wall Street Journal estimated that a minimum of 3,000 tickets per show were not sold – not counting any artist, promoter, or venue holds – which almost certainly push the total far higher.
On her Reputation tour, the attempts at manipulating the market through holdbacks led to major issues in the last weeks before the curtain went up as huge blocks of tickets to shows that had allegedly been rapid sellouts remained unsold – leading to instances of tickets being sold for a fraction of the initial asking price through intermediaries, or given away entirely. For one show in particular, one Levi’s Stadium show saw 20,000 tickets given away before the show to keep it from being played in front of a venue that was only at 60 percent capacity.
Will lawmakers put an end to the ticket holdback shell game? The requirement of transparency on how many tickets are actually available for any given show, at any given point in the ticket sales process would be of incalculable value to the ticket buying consumer. It would allow for informed decisions to be made, because fear of missing out when a show is falsely implied to be sold out or close to sold out drives prices up.