Which is on the low side for an entertainment software company. Also worth noting that most of their Ticketing growth is coming from international markets, where they aren't at all a monopoly, and yet the margins there are the same... and it is even more misleading than that, the denominator for that margin isn't including the bulk of the price people are paying for the ticket, which flows through to venues (where the margins are even lower). Per said same report, if you add Ticketing & Converts --and Ticketmaster sells tickets for a lot of other customers who aren't Live Nation, so if anything that is under-counting the total value of the tickets sold by Ticketmaster-- the combined margin is around 8%. So that's ~8% of the money you spend on a ticket that is going to Live Nation.
In fairness though, I did misspeak. The margins on ticket resale are quite big (and that's a driver of much of the profit margin in that report). That's usually not what people are referring to when they say "junk fees".
When people refer to "junk fees", they're normally talking about the fees associated with primary ticket sales, which have much lower margins (closer to 7-8%), because most of the money for those fees flows through to the other parties involved in the event. This has all been documented on several occasions. TM's blog actually recently put out a decent article walking people through it: https://blog.ticketmaster.com/the-truth-about-ticket-prices/.
The primary ticket sales service game is largely about volume. You've got an absurd amount of money being exchanged, so taking a small bit of it can work out to significant revenue, but it doesn't dramatically change the price people end up paying for their tickets.
To me, worse than the fees, is all the crap "promotions" that Ticketmaster tries to get you in on after you decide to buy your ticket from the venue... and it's a pretty good signal about the low margins on those sales. It's super annoying, but it makes sense for them to do it because any lost sales at the end of the funnel there are comparatively a small price to pay for the money they're getting from the promotions (which generate about half as much revenue for Live Nation as ticketing, but at less than a third of the cost).
No question that people are getting a raw deal when they buy tickets on Ticketmaster, but the perception of the problem is really different from the reality.
[For transparency: I spent 7 years in the live events industry. I now have nothing to do with it.]
cbsmith|1 year ago
In fairness though, I did misspeak. The margins on ticket resale are quite big (and that's a driver of much of the profit margin in that report). That's usually not what people are referring to when they say "junk fees".
When people refer to "junk fees", they're normally talking about the fees associated with primary ticket sales, which have much lower margins (closer to 7-8%), because most of the money for those fees flows through to the other parties involved in the event. This has all been documented on several occasions. TM's blog actually recently put out a decent article walking people through it: https://blog.ticketmaster.com/the-truth-about-ticket-prices/.
The primary ticket sales service game is largely about volume. You've got an absurd amount of money being exchanged, so taking a small bit of it can work out to significant revenue, but it doesn't dramatically change the price people end up paying for their tickets.
To me, worse than the fees, is all the crap "promotions" that Ticketmaster tries to get you in on after you decide to buy your ticket from the venue... and it's a pretty good signal about the low margins on those sales. It's super annoying, but it makes sense for them to do it because any lost sales at the end of the funnel there are comparatively a small price to pay for the money they're getting from the promotions (which generate about half as much revenue for Live Nation as ticketing, but at less than a third of the cost).
No question that people are getting a raw deal when they buy tickets on Ticketmaster, but the perception of the problem is really different from the reality.
[For transparency: I spent 7 years in the live events industry. I now have nothing to do with it.]