Guest post by David Goldberg, EVP, TicketMaster
As executive vice president of the world’s largest ticket retailer, Goldberg oversees Ticketmaster’s ‘global music services’ business, developing strategic alliances with clients and music industry organisations.
Current industry flux means it’s around one of the most exciting times ever to be in this business; there’s no better forum for these issues than MIDEM.
We above all need to reinforce in fans’ minds the notion that live and recorded music aren’t two separate silos, even though they’ve behaved that way to date. We now need to work together and treat the consumer holistically; and we have offerings that speak to that.
For example, we’ve been offering priority concert ticket access through a special code linked to buying the artist’s album on iTunes. We’re currently rolling this initiative out beyond the US, with Paul Kelly in Australia and with the Foo Fighters in the UK. This has been a great success for all involved, as it brings more attention to the recorded product and gets the record marketed to the right people. It’s not rocket science, just rewarding loyalty to the artists. Between iTunes and our website, we probably get the most paying music customers on the internet!
We also use our marketing strength and reach to help artists through their official fanclubs, which are often run by the labels; we notably have a strong relationship with Warner Music, for example for selling fanclub memberships pre-tours, as this guarantees pre-sale ticket access and seat quality. So we’ll bundle fanclub membership with the concert ticket and enable people to see their seat before they join. This way bands build a subscription base and labels get to know their customers better. These are just a few ways of leveraging live for other purposes. As an industry we’re constantly trying to innovate; but if something’s working, replicate it!
We have the good fortune of being in a strong position right now and hence able to invest in companies like iLike, Echomusic and Frontline Management… so now, we have a lot of toys in our sandbox. My heart is in how we can use technology to grow the business – hence iLike – but what really gets me excited is connecting managers with tools like Echomusic. In this industry, there are so many people involved at every level, you need to be able to cut right through to the decision-maker.
TicketExchange is another area where technology has made a huge difference. The storefront business has moved online; yet resale market buyers are still fans too, and
they’re sitting out there untouched by the industry. So there’s a great opportunity for creating an answer to eBay… but we will always operate with the industry’s permission. TicketExchange has been out for a year for music (several years for sport) and 20 tours have used it so far, everything from Police to Interpol. The bulk of the money does go to the reseller – a percentage of the overall transaction can only be profitable for us at scale – but it’s really about providing a service. Also, some artists don’t want to condone resales, they distance themselves from it… they’re just opening doors
to third parties.
We’re also looking into finding ways of doing subtle discounts, because most concerts don’t sell out; the challenge is not letting on! Plus we’re thinking about things more globally; 5-6 years ago, only 1% of our turnover came from outside the US; now it’s 25%.
A lot is said about the live boom compared with the drop in recorded sales; yet there is more on offer today in recorded music sales than ever before. Digisingles and ringtones are through the roof, not to mention DVDs… the problem is that the recorded industry is not set up to be profitable out of these new things. If these companies were right-sized for these new foms of consumption, it would be fine. Instead, they’re set up to need to sell CD albums in order to be profitable.
Looking ahead, live will continue to be healthy and labels will work out how to work with live, so we don’t return to those old silos I mentioned before. Working with live doesn’t necessarily mean revenue sharing… I think there’s still a huge potential for live recorded music [post-gig CDs], it’s just the rights issues that are difficult; plus labels are worried about cannibalisation… but that again is the old mindset. We have to think about recouping the investment in different ways.
Goldberg speaks at the 2008 MidemNet Forum
on a panel examining bundling and pricing packages such as the iTunes example entioned above.