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'A True Ticket Exchange Program'

12:01 PM Friday 5/20/16 | |

The upcoming BottleRock Napa Valley festival in California caught our attention with a recent press release. It announced it had sold out all of its tickets to the May 27-29 event and, in the same release, announced a partnership with a ticket resale service called Lyte. 

  • Bottlerock

    Matt Shultz of Cage The Elephant visits the crowd during the 2015 installment of BottleRock in Napa, Calif. The Memorial Day weekend festival has seen quite the turnaround from its 2013 debut.

    (Tom Hoppa)

    | 

Imagine what would happen if a Lollapalooza or Coachella, after selling out, immediately told disappointed fans to go to StubHub.

Yet when BottleRock made the announcement, nobody raised an eyebrow. Maybe the festival promoters – who proudly claim no previous experience in the music festival space – were oblivious to a possible firestorm. Or, as it turned out, Lyte isn’t a ticket broker.

Pollstar talked to its CEO, Antony Taylor, who disputed the terminology and said it was time the industry openly embraced a true ticket exchange program.

We thought the announcement of a festival selling out and also announcing a partnership with a third-party ticket broker unique.

I don’t think it should be unique in 2016 but it certainly is. I’ll explain what we do and what we mean by “ticket exchange.” There are a couple ways to look at it. Outside of pro sports, the secondary market is an afterthought for fans. The big guys spend a lot of time and money parking their brands next to pro sports franchises to get awareness and a lot less time and money on the club/festival music space. We’re a little different; that’s the market we’re looking to address. If I need to unload my ticket because my plans change, it’s a really tough experience. From a promoter standpoint, there is a massive gap between when I sell out and when everyone is at my doorstop. I could have 25 percent of my audience show up that I have no idea who they are. Even worse, 125 percent of my available audience could show up because people were selling fake tickets multiple times.

Of course, I had nothing to do with it but I’m bearing the brunt of the consumer experience. I have to look that person in the eye and say sorry, that’s not a real ticket. We thought this as an opportunity for servicing a need and doing it in a way that is consumer friendly and it helps the promoter with the stated purpose of filling the venue. We allow people to reserve tickets after it is sold out. They’re not shopping for listings; they’re not purchasing tickets from other individuals.

They don’t have to pull up 17 tabs on their computer to price shop. We are establishing that price and we’re allowing fans after the onsale to queue themselves up. It’s a first-come, first-served queue. There’s no way to jump that queue. You can’t jump it by paying more. It’s a fixed price. In our minds, you’re a fan, not a broker. You can request an offer. We will make an offer. If you accept it, the transaction is complete. We PayPal you the money and you go about your day. About 80 percent of the people accept our price offer. ?

Would you say you’re a third-party version of what Burning Man does on their bulletin board?

You mean with their STEP (Secure Ticket Exchange Program)? The difference is we’re using technology to do the matchmaking. It just eliminates the waiting game. As for “third party,” we’re licensing our technology to the BottleRocks of the world so it becomes an extension of the promoter’s box office. This is not another StubHub. It’s not a third party competing with the box office. And it’s had a really powerful effect. We’ve done a really good job of moving people away from these unregulated, anonymous marketplaces and, in doing so, getting prices in check. We don’t think about it as a third party but as an extension of the first party.

So third-party is a misnomer.

It’s a new category. It shouldn’t be.

How can you confirm the seller?

That’s the benefit of partnering with the promoter, which we call the “rights owner.” We integrate with their platforms where they have the data. That butterfly in your stomach as you walk up to the ticket gate? That doesn’t exist when you build your system into the promoter’s data.

There is a reluctance in the industry to acknowledge how tickets arrive on secondary platforms versus a BottleRock that transparently announces, and partners with, a platform for those tickets. Do you see more promoters coming around to this way of thinking?

You’re dead on about the traditional stigma related to the aftermarket. And let’s be clear: the stigma was 100 percent earned. This has been a murky place without transparency where gouging is the norm. The whole model is what we’re challenging. Consumers are smart enough to know if all the listings are 300 percent over face value and built tightly around the same median that there are probably a few brokers colluding toward an artificial price range. It’s just abuse.

I just want to be clear: that stigma is totally deserved. Our engine goes out and monitors the secondary market and all the sales. We actually see all the abuse and we massively undercut that market. You can see case studies where the [ticket exchange platform] turns on and immediately all these bad actors are forced to bring their prices down.

When the promoter is actually solving the problem, you can turn the experience from something with a much-deserved stigma to a value-added feature that differentiates your brand. Folks like BottleRock are willing to take the risk, sort of speak, stepping into a market that is stigmatized and making it a good experience. Our partners are not partners until they understand how we’re different and have seen it work.

So how do you and your partners make a profit off of this?

We license the platform to promoters, artists and athletic departments. The revenue split is confidential to each promoter-artist-team license deal.

How do you pitch your product to potential customers?

With the caveat that each pitch is different, we tell potential customers that we can improve your fan experience (and control it) by removing the No. 1 pain-point in ticketing and the live event experience.

We capture the data that belongs to you and is extremely valuable; specifically, A, how many people were actually willing to purchase a ticket for your event (using Smart Queue/reservations) and, B, who actually came to the event (because Lyte has the actual manifest).

We say we put scalpers and resell websites out of business by offering a fan-friendly alternative that is entirely fraud-free. We score high marks with consumers on everything (literally): ease-of-use, pricing, fees, safety, quality, transparency. You name it. It's a better experience.

Lyte has more than 200 clients including the SnowGlobe Music Festival in South Lake Tahoe, Calif., Mumford & Sons, Father John Misty and the Catalyst club in Santa Cruz, Calif.


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