Live Nation To Partner With Groupon To Sell Discounted Concert Tickets
May 10, 2011 at 4:00 AM (PT)
To generate revenue and cut into the estimated 40% of concert tickets that go unsold annually, TICKETMASTER parent LIVE NATION ENTERTAINMENT is joining with the popular online deals site GROUPON to launch a discount ticket site for live events. The L.A. TIMES reports that GROUPONLIVE is expected to launch in JUNE.
GROUPONLIVE will offer discounts to events that aren't close to selling out. "It's the equivalent of the bakery giving half-off on muffins at the end of the day," Forrester Research analyst SUCHARITA MULPURU said.
As with GROUPON's main service, people can sign up to be notified via e-mail of discounted concerts in their city. "A show might sell out in LOS ANGELES, but not in PHOENIX, for example," LIVE NATION CEO MICHAEL RAPINO said. "Finding ways to deliver the message to local e-mail in-boxes is the way of the future."
Of course, the risk in doing this is in alienating hardcore fans who waited in line and paid full-pop for tickets now being dramatically discounted. "Discounting is dangerous because it can cannibalize full-price sales, which is the lifeblood of the business," online ticket service SCOREBIG CEO ADAM KANNER said. "When you start trading dollars for pennies, it becomes a race to the bottom. So it has to be done very carefully."
RAPINO, naturally, disagreed. "There will be consumers who will wake up each morning and go to GROUPONLIVE who otherwise wouldn't have heard of the event," he said. "This incremental sale from new consumers will outweigh any cannibalization that could occur. This is about volume. The more tickets we sell, the more everybody makes."
Plus, as POLLSTAR publisher GARY BONGIOVANNI noted. "When the event is at one of LIVE NATION's venues, it also means the $10 parking fee, the $5 beer, and so on."