As a sidebar to our lighthearted #FeeFreeFriday, this post looks at small business ticket sales in a more serious tone. Recent legal developments in the states of Maryland and Florida need to be closely monitored by small and mid-sized venues. The outcomes will impact your ability to make money.
A quick look back at the March 11th Baltimore city council decision to grant Ticketmaster an exception to the current anti-scalping law(s) is evidence of a troubling trend.
Ticketmaster found 11 stalwart friends tonight as the Baltimore City Council voted to allow the region’s dominant ticket-selling middleman the right to charge unlimited convenience and other user fees for sports and entertainment tickets.
The actions in Baltimore Maryland are detrimental to owning a venue or being an authorized re-seller for a ticketed event. Without going into the malaise of legalese, the law that caps face value markup at fifty cents still stands.
However, with the new exception that has been granted, Ticketmaster and its parent company Live Nation now have an unfair competitive advantage. Ticketmaster can charge as much in fees as they wish and do not have to adhere to the fifty cent cap. But you and your authorized re-sellers do.
If you own or operate a venue in Maryland, especially in the highly competitive Baltimore market, your access to the coveted 18-35 demographic has just become more economically restricted. Disposable income, spent on non-essentials like a concert ticket, is already scarce. The overhead costs you amortized through ticket fees must now be put into the displayed face value of the ticket.
Ticketmaster can advertise and sell tickets for $20.00, then tack on another 50% in fees during the purchase process. You, however, must display the full $30.50 price on the ticket up front. Even though the final prices are the same, given a choice, which will get more attention from potential customers?
In order to be competitive, your shows will have to become more cost-effective or you will have to book more shows at even lower margins. Gains made in either category may or may not make up for the competitive advantage Ticketmaster is enjoying.
If you current ticketing software is charging you any type of per-ticket or per-purchase fees at all, you are caught between a rock and a hard place.
Just a few hours ago, the Florida state senate subcommittee voted on two bills that would take control of event ticket sales methods and pricing out of your hands. The spirit of the first bill, number HB 163, is nearly identical to the law in Maryland in its intent to curb unauthorized ticket reselling at exorbitant markup.
But HB 163 is not the warm and fuzzy puppy its “consumer protection” language conveys. It will remove one of the most effective anti-counterfeiting measures available to venues: paperless PDF tickets.
The Tampa Bay Times said “House Bill 163 sounds as if it is a consumer-friendly piece of legislation, but the reality is it would benefit scalpers and make life more difficult for almost everyone else.”
Worse still, another bill, HB 1353, was introduced at the same time, also intended to stop unauthorized resales. HB 1353 gives the government even more control over event ticketing and would reduce the choices in how venues sell tickets.
You get a sense of déjà vu when you read of the concern to whom, if passed, it would favor most:
There seems to be little doubt that Raulerson's legislation would cut into the scalping business, but there is also language in the bill that might swing the pendulum too far in the direction of venues and corporations such as Ticketmaster.
In both Maryland and Florida, the hard working small venue’s ability to make money is slipping into the hands of a single corporation. Case law precedent operates in such a way that once a legal statute has been established in one state, it becomes the law of the land everywhere.
Regardless of the outcomes in Maryland or Florida, every small to medium sized venue should review their current ticketing software and considered how much control you currently have over pricing and fees.
ThunderTix does not charge you per-tickets fees and when you switch to us you have control over pricing and fees you wish to charge. We also make nightly deposits of your sales dollars directly into your bank account. Also, we do not make use of your customer contact information for our own purposes. Can your current ticketing software say the same?
Image source: Wikimedia Commons
