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June 16, 2005

Compare and Contrast.

It can be interesting to see how different papers cover the same basic premise. Back on Monday the Telegraph covered ticket touts. The problem is outlined and a solution offered. The problem, of course, is that the organisers of the events are not segmenting their market sufficiently (usually on a time basis) and thus leaving profits for the touts to pluck. The answer is obvious, for them to segment the market themselves and pocket the profits that the touts currently make.

Today the Guardian starts with the same basic facts and, well, moans a bit that people make profits.

Tickets bought from unauthorised websites cost on average 69% more than their face value, according to a recent report by Group 4 Securicor, which provides security at events such as Wimbledon and the Ryder Cup. The premiums will not stop UK buyers snapping up more than 2.2m tickets on the black market over the next 12 months, according to the report.

"The online auction sites have effectively given touts a new channel to offer their wares," said Group 4 Securicor's marketing director, Douglas Greenwell, who believes affluence is helping drive the market. "There are many more professionally organised events nowadays and as a society we're slightly more wealthy than we used to be. There is strong demand for tickets to big events like a U2 concert or the Ashes."

I do think that this Greenwell needs to learn a little more economics. Quite the most blindingly stupid comment on the whole matter comes from him:

Mr Greenwell said that the ultimate responsibility lay with the event organiser. "Some believe it's important for people to buy tickets at their fair market value," he said. "Others might not feel it is that important."

Jesu Christe bonehead. Fair market value is whatever people are willing to pay. The question is who should get the difference between that and what organisers charge? The touts? Or should the organisers change their method of marketing so that they get it?

Maybe I’m being a little unfair, too demanding perhaps, but I do think that someone who’s just released a report on the damn subject should actually know about the damn subject.

Update. To be fair the Groan Leader on the subject isa little better, obviously referring to the Neil Collins piece in the Telegraph:

One suggestion is to sell tickets using an easyJet style system of escalating prices.

They still manage to miss the real point though.

But so long as demand for tickets outstrips their supply, then the tout - whether in real life or in cyberspace - will always be with us.

Nooo! by slicing and dicing the market, charging each section of it an amount equal to their willingness to pay you abolish the tout! Sheesh.

Update II. Stumbling and Mumbling is also good on this as is Lynne Kiesling .

June 16, 2005 in Media | Permalink

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Comments

On the other hand, selling on your ticket IS usually a breach of the contract printed on the back.

But yeah, they should sell 'em easyJet style as you say.

Posted by: N.I.B. | Jun 16, 2005 8:42:12 AM

There must be ways of making ticket sales into a rolling auction, I guess using mobile phones.

Posted by: Rub-a-Dub | Jun 16, 2005 9:27:47 AM

Not sure the easyJet model always works, particulary for very popular events. When a U2 concert, or whatever, sells out within the first hour it doesn't give much time for the market to be segmented; it doesn't give some people the chance to get a ticket at all before they are sold out. Then there is no option but to go to a tout if you still want to go to the gig; although you could call that a form of market segmentation after the fact.

Posted by: Quinn | Jun 16, 2005 10:52:17 AM

The promoters of a concert, or a sporting event, should have no say whatsoever in the after sale actions of the ticket owners! The promoters have made their money, and if there is a post-sale market, the market wins. The punter has taken a risk by buying at the fixed price, if he doesn't sell the ticket, the worst that happens is he goes to the gig!

Posted by: Mike Cunningham | Jun 16, 2005 11:07:24 AM

They should have a dutch auction for the tickets if they want to get rid of touts.

They could sell them all through ebay!

Posted by: Rob Read | Jun 16, 2005 11:51:58 AM

"The promoters of a concert, or a sporting event, should have no say whatsoever in the after sale actions of the ticket owners!"

Don't see why this should morally be so (and it certainly isn't the case legally). You agree to the proprietor's T&Cs as part of the contract that your ticket represents - just as you can be refused entry if you turn up egregiously drunk, or with a video camera.

Posted by: john b | Jun 16, 2005 1:03:26 PM

I have to disagree with Tim Worstall. You said you used to live in Russia, now as you should know in Russia the Mafia buys ALL the tickets for the Operas in places like Moscow for their face value (say 50pence) and then sells many tickets at this value to everyday Russians, but also a lot at inflated prices - say £50 - to tourists.

Obviously, in the case of Live8 there was no scope for organised crime to corner the tickets (probably), but condoning the general practice is promoting crime.

Posted by: Monjo | Jun 16, 2005 1:50:34 PM

I can't see the problem Quinn - surely the tickets sell out so quickly because they're all fixed at the same price. Just adjust the price upwards with each ticket sold and the job would be a good 'un.

Also, I'm not sure about that Mike. If I'm organising the event, and I'm paying for the venue, the catering etc, well, it's my shout really. You wouldn't want some random stranger at your wedding reception claiming he has a right to be there because he bought the invitation from your mate who can't make it for fifty quid on eBay, would you?

Posted by: N.I.B. | Jun 16, 2005 1:57:16 PM

NIB said: "You wouldn't want some random stranger at your wedding reception claiming he has a right to be there because he bought the invitation from your mate who can't make it for fifty quid on eBay, would you?"

Well, no, you wouldn't, that's why you issued invitations personally to your friends, rather than selling them to whoever had the money to pay and the luck to be early.

Posted by: The Weasel Bearder | Jun 16, 2005 2:24:19 PM

N.I.B.
different set of circumstances, really. One is a concert where tickets are sold to the general public, the other is a private event for relatives and friends.

If you thought the concert fans would stand it, the prices would have been higher, and so the market would have spoken!

Plus there was someone who flogged his mate's wedding invites on eBay, but only becasue the bride was, in his opinion, a close realtive to a dog!

Posted by: Mike Cunningham | Jun 16, 2005 3:49:47 PM

Hmmm, metaphors have to be watertight round here, don't they?

So I'll try again...

Okay, I'm running a big concert. I want to know everyone's name and address so I can use the list for marketing purposes. Someone sells on a ticket, my database is now polluted - someone who hates U2 is on my list and someone who loves them isn't.

Now someone wants to buy my list so they can mailshot U2 fans. But they've seen that a lot of tickets have been touted, and knock their offer down correspondingly. Therefore the tout has stolen part of my revenue.

That's how I see it. I'm pretty sure the law does, too. In fact, I believe the ticket actually remains my property (certainly in the case of season tickets anyway) and I can ask for it back if I suspect any foul play.

Of course I could also print "Please Tout This Ticket, I Really Don't Mind" on the back if I really wanted to. But for some strange reason, I've never seen a ticket like that...

Posted by: N.I.B. | Jun 16, 2005 4:13:02 PM

NIB, I think that it is simpler than that.

Most tickets say they are non-tranferable. If you enter a contract on that basis and then sell the ticket on, then you are in breach of contract.

I see what you are saying with regards my statement that the easyJet model may not work for very popular concerts. I was thinking that market segmentation was difficult with very popular and traditionally over-subscribed event; I still think it is a difficult and pratical problem (who wants to queue for ages on a phone line before thay find out what the current price is for tickets, for example) but it is not impossoble to solve.

That said, I am not sure it resolves the situation with regards touts. For heavily over-subscribed events, touts can still buy the early cheap tickets, then sell them later once the price has risen.

Posted by: Quinn | Jun 16, 2005 10:18:04 PM

"That's how I see it. I'm pretty sure the law does, too."

The law doesn't see it that way at all, NIB, otherwise it would be illegal.
This whole argument is much ado about nothing. The tickets that were up for sale on eBay are now on sale elswhere. Market forces will now dictate whether they are sold or not. It's called free market economics and it made us the affluent, healthy society we are. It is also probably the most likely way for Africa to progress. Certainly more than all this self indulgent false morality being spouted by the indignant public, fuelled by an Irishman with a big mouth.
Anyway, how many of these people are going to help Africans and how many are going to see their favourite bands?

Posted by: Nik | Jun 16, 2005 11:52:40 PM

Well, there's a little bit more to the events business than mere ticket sales, but I guess that's beside the point now.

I shall continue, like a dog with a bone, having picked some old tickets at random:

The terms and conditions on my season-just-passed Bath Rugby season ticket specifically says "No resale of the ticket is effected for more than its value."

The ticket for the Zurich Championship final 2001 says much the same.

Bristol Shoguns vs Bath, 4 May 2003 at Ashton gate:
"* Bristol Shoguns shall be entitled to refuse admission to any ticket holder if it thinks fit without giving any reason
* The ticket shall remain the property of Bristol Shoguns which has the right to recall the ticket at any time should it so wish"

Which to me sounds rather like 'touting is a breach of contract' to me - and last time I looked, breaching a contract is illegal, because it buggers free market economics right up when people do things like that (ie, steal).

Anyway, you'd have that a succesful businessman (?) like Geldof would know how to put together a decent contract though, rather than getting on his moral high horse...

Maybe he should ask for photo ID on the gate along with the ticket? That'd be pretty funny. And it'd solve the dilemma Quinn came up with.

Tim adds: Bath season ticket? Bastard. That’s one of the few things I miss about living abroad.

Posted by: N.I.B. | Jun 17, 2005 12:59:43 AM

Look on the bright side Tim - you missed a fairly frustrating season!

Posted by: N.I.B. | Jun 17, 2005 8:26:43 AM

You guys suck dick all of you!!!!

Posted by: anonamus | Apr 7, 2008 4:18:31 PM