Is the concert promotion business recession proof?
Thursday, May 22nd, 2008
Many experts are reporting that the US economy is weakening. Some have even suggested that we are in a recession which could have a ripple effect around the world. However, it has always been my opinion that no matter how tight consumers get with their hard-earned dollars, they still need to be entertained. I’m not talking about playing video or card games with friends or family. And, watching a ballgame or the movie of the week on television isn’t exactly what I’m referring to either. I’m talking about putting on some nice clothes, getting out of the house for a few hours, and spending some money to see a live concert at the local night club, theater, arena, or stadium. So, I ask the question “is the concert promotions business recession proof?”
People are pulling back from spending on big ticket items. Consumer spending has dropped for at least four straight months. In the meantime, our business strives on people who have discretionary income. These are the same folks who pay their cable tv bill every month before buying food or shoes for their kids. This may sound strange but “you gotta love it.” Some consumers will still pay for entertainment even while living on a tight budget that keeps getting tighter. Six Flags recently reported that season-pass sales are running comfortably ahead of last year’s pace. The WWE stock is up and there is no shortage of wrestling fans packing the arenas even when it’s being broadcast on tv 3-4 days in the week. Rap start Jay-Z just signed a $150 million deal with Live Nation which includes the rights to promote his live concert performances. And there are so many more examples to state.
It does appear that one of the affects of the slow economy is that many are bypassing the opportunity to buy a lot of merchandise while inside the venue. I recently took my son to a Monster Jam Truck Show and passed on getting us Grave Digger t-shirts because they were like $30 each. Instead, he got a less expensive banner to hang in his room. He was happy and I saved about $25 (OK, some may say I’m just cheap). It’s all good. Merchants will find creative ways to get their numbers up and so will the various businesses related to the concert promotions business. The key is getting the people in the house and this is something the consumers still want. Their appetite for live concerts may have slightly diminished. The results of which may lead to lower ticket prices, finding stronger acts to book, looking at alternative music genres, or securing more sponsors. However, the good news is that, no matter what the current economic conditions are, people are still going to theaters, concert halls and night clubs to see a live show. There’s nothing like it and it can’t be duplicated on tv, on the internet, on CD, on DVD, or anywhere else. Technology has improved the audio quality and the light show experience. Plus, live shows offer a unique emotional bond between the fans and the artist. The average fan may not have all of their favorite recording artist’s albums but they never miss them when they come to town to perform.
I believe concert promoters can still promote successful shows and special events, despite the current economic conditions. Entertainment provides an escape from the challenges of everyday life. It provides a way of releasing tension and anxiety. It makes one feel good. And when times are tough sometimes it’s worth paying a few bucks (or a lot of bucks) just to remember what it feels like to enjoy life.
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