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Why booking fees are fair

Whether you like it or not, booking fees aren’t the mark of a dodgy operator, but the reality of a struggling music business, writes ALANA MARKULIS in light of Ticketek and Ticketmaster’s recent nomination for a “Shonky” business award.

I’m constantly reading articles from various websites analysing ticketing systems and presenting an unbalanced view on their “excessive” and “not up front and centered” fees. And it bugs me. You see, I do know the ticketing “world”. I’m the ticketing manager for Billboard The Venue have managed ticketing for small festivals and events; and manage a band called Planet Love Sound, who facilitate portions of their ticketing via their website.

First and foremost the music industry is a business. The ticketing agencies are a business. And whether we like it or not we all are in this together. It’s all one big incestuous orgy.

But let’s start from the start. In an oversimplified breakdown, the act no longer makes their primary income from music sales (shock horror) they make it from touring and merchandise sales (or by being played as the theme song to your fav show on MTV). With that in mind their performance fees have now increased dramatically and the promoter bringing them out has to increase ticket prices, or have two headliners per gig at venues. It means venues have less shows, less money and, yes, less patrons coming through. (Lest we forget the five-plus venues in Melbourne alone which have shut down in the past 12 months.) The ticketing agencies glue us all together. They’re also the so-called bastards charging us exorbitant fees.

“The ticketing agencies glue us all together. They’re also the so-called bastards charging us exorbitant fees.”

Explaining Ticketek and Ticketmaster’s nomination for a “Shonky” business award, Choice magazine pointed to a credit card surcharge of $2.64 and a handling fee of $9.50 for Elton John’s upcoming tour, while maintaining that Ticketek’s service/delivery fee was the same regardless of whether you bought one or 10 tickets. That fee, they said, was even applicable when “you print them out yourself. On your own printer. With your own ink and paper”, and then further pointed out that “fans were hit with a $11.25 charge to receive their tickets by registered post, despite the fact that it only costs $3.65 to access that service ordinarily”. Meanwhile, punters heading to Jack White’s Splendour sideshow in Sydney reportedly had to pay a $7.60 charge for a ticket that was sent as an email attachment. They also had to pay a credit card surcharge.

Now you may be ready to jump on the ol’ soap box telling the masses about how shocked you are that these capitalist assholes are exploiting your devotion to music. But booking fees are generally justifiable and I’ll break it down for you. Whether or not you print out your own tickets or get them mailed to you there is a certain amount of labour going into both. (For more on paperless ticketing click here.)

Booking fees cover, as the Ticketek Australia GM pointed out to The Sydney Morning Herald, “labour, dispatch, handling and the cost of technology that supports the scanning of these tickets”. All this new technology – apps, mail-outs, paperless tickets, as well agents now being able to link your accounts with tickets you may want refunded, or have lost or want to re-issue to friends because you can’t go last minute – well, people are employed to develop that technology. Lawyers are brought in to review the legalities associated with that technology, and then there are the customer service reps that you can speak to, and tech dudes updating, maintaining and distributing that technology. Unfortunately it doesn’t fall from the sky.

We use several ticketing agencies at Billboard and, let me tell you, I speak to the staff at those agencies more times per day than I do with people I share the same DNA with. These people include my primary, secondary and third account managers. Also I have an after-hours emergency team and personal account managers in the following areas: marketing, business development, financial, IT support and state/national.

“Whether or not you print out your own tickets or get them mailed to you there is a certain amount of labour going into both.”

In addition, they handle customer service queries and have actual freestanding agencies operating where you can buy or pick up tickets. They facilitate sales reports via their accounts departments and customer lists so that when you choose “venue pick up” as an option I have lists emailed to both the promoter and myself two hours before doors. When you ring with a query – say you bought tickets to the Sydney show instead of the Melbourne show – then the customer service rep gets in touch with me and I get in touch with the promoter to seek approval for exchange, go back to my account manager who goes back to the customer service rep who then calls you back to tell you, “Hooray! We can change over the ticket.” We then all readjust our allocation of tickets and facilitate the transfer of your ticket to the correct venue. Convoluted explanation? Yes. Still wondering why bookings fees are so high? OK, lets move on.

Also you might notice ticketing agents marketing in places like news websites, newspapers, streetpapers or sending you fancy newsletters with moving images, competitions and what not. Again this marketing costs money. Why do they do this? Because the venue wants it, the promoter wants it, the artist wants it and, yes, you want it. Otherwise how would you know certain acts are coming to town, when 2-for-1 offers are available or package deals are up for grabs. Still not convinced? OK, I’ll continue.

As the music industry struggles, we see new and innovative ways of developing income streams. We see labels participating in 360 deals, presales via artists websites including signed merch and promoters and venues negotiating business deals with ticketing agencies so that they can claim a rebate/commission/fee for allowing them to sell tickets to their shows/venue.

This rebate/commission/fee forms part of the booking fee. Choice noted that in 2009 to get “exclusive ticketing rights, these companies have to pay the venue owners ‘key money’, which they recoup through high ticket profit margins”. This much is true. Irrespective of exclusivity agreements a venue, promoter or event organiser may promise a major portion of a ticketing allocation. Where Choice falters in their article is their claim that “event owners and producers may have a choice of venue, but they have no choice of ticket seller when the exclusive ticketing rights of the venue have been signed over to a particular ticketing agency”. Wrong. In the current touring realm, venues will do just about anything to appease a client (the promoter). If a promoter wants a portion of tickets sold via a particular agency, trust me, as long as there is no exclusivity agreement (which I’ll add is increasingly becoming far and few between) the venue will agree to the client’s wish.

One of my favorite bloggers, Bob Lefsetz, summarised the point of booking fees perfectly: “Everybody on the inside knows the fees are profit, and without promoter and venue and ticket provider profit, you’ve got no touring business.”

Alana Markulis is the ticketing manager for Billboard The Venue and manager of Melbourne indie band Planet Love Sound. For further reading on booking fees click here.

What you said…

Comments

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i_have_ADD

i_have_ADD said on the 15th Nov, 2012

check out the total 'service fees' on x4 VIP tickets to both weekends of ultra music festival in miami :D

https://fbcdn-sphotos-f-a.akamaihd.net/hphotos-ak-prn1/536633_10151113536976606_1426458762_n.jpg

NiteShok

NiteShok said on the 15th Nov, 2012

this is a good read, thanks alana. good to hear the other side of the story.

Braveheart81

Braveheart81 said on the 15th Nov, 2012

Nice article.

I think the inbuilt advertising charges and customer service that is available and provided are areas that most people don't think of when they complain about booking fees.

Choice's point about the registered post service only costing $3.65 is one of the dumbest things ever.

I also find it amusing that many of the same people complain about both ticket scalping and booking fees. They want more to be done about ticket scalping yet complain about ticket booking fees. Every single anti-scalper measure adds to booking fees.

shazie

shazie said on the 15th Nov, 2012

Very nice read, it felt like I was reading one of Braveheart's posts (in a good way, of course).

postman_pm

postman_pm said on the 15th Nov, 2012

Personally my issue with the ticketing agencies wasn't with the fee's themselves... it was the inconsistency with fees. I understand that there is technology/staff/etc that they use to run their business, that makes sense. What doesn't make sense is the example I've used in previous comments where I went to 3 different shows at the same venue in the same year, all purchased from the same ticketing agency. All 3 sets of tickets had different Credit Card Fees, different Transaction fees, and one also had a handling fee (isn't that part of the transaction fee????)... None of the fee's were a percentage of the ticket price... and why did one have a handling fee and the other 2 didn't... yet they were all delivered via regular mail. Have a flat postage/email fee, a flat credit card fee and leave it be... People will stop complaining if its the same for everything

shazie

shazie said on the 15th Nov, 2012



Which 3 shows were they?

Braveheart81

Braveheart81 said on the 15th Nov, 2012



What if the costs are different?

What if the promoters have asked for the ticketing company to provide different levels of advertising for each concert, different levels of customer service and flexibility in terms of transferring tickets etc?

There are so many unknowns.

gumbuoy

gumbuoy said on the 15th Nov, 2012



I don't think they would. They'd just complain about the fees being too high. You might be complaining about inconsistency, but I think most people are just cheap.

EDIT: ...and like the chance to criticise a business model they don't know about, and probably wouldn't understand. Take it from a public servant, that's true.

yavimaya

yavimaya said on the 15th Nov, 2012

most of what the companies are saying is just what it takes to run a business.
i dont care if they "need new systems" or "have staff to pay".
every business has to pay staff and upgrade systems, no other business gets to add fees ontop of what they already get paid, simply to pay off thier new systems a bit quicker.
if the "fees" are/were the only profit they were taking then it would be different.
what they do is like if banks added a "$5 transaction fee" to every single transaction ever made, simply because they had to introduce internet banking a few years ago and had to pay for a bit of software/hardware.

Braveheart81

Braveheart81 said on the 15th Nov, 2012

most of what the companies are saying is just what it takes to run a business.
i dont care if they "need new systems" or "have staff to pay".
every business has to pay staff and upgrade systems, no other business gets to add fees ontop of what they already get paid, simply to pay off thier new systems a bit quicker.
if the "fees" are/were the only profit they were taking then it would be different.
what they do is like if banks added a "$5 transaction fee" to every single transaction ever made, simply because they had to introduce internet banking a few years ago and had to pay for a bit of software/hardware.

The booking fees are what the ticketing companies get paid.

yavimaya

yavimaya said on the 15th Nov, 2012

that is the only money they take? the $3 - $12 or so booking fee, not one cent more?
im not in the industry, but that is far from what i have heard over the years.

Lucan

Lucan said on the 15th Nov, 2012

that is the only money they take? the $3 - $12 or so booking fee, not one cent more?
im not in the industry, but that is far from what i have heard over the years.


I read that as being their "profit". Profit and total income being two different things.


My issues are the way the fees are charged. I understand the agencies need to run a business, but don't ream me at the end of the transaction. The "Credit card fee" is bullsh!t, and if they want to cover this cost it should be included in the generic "Transaction Fees". More often than not Credit Card is the only available payment method when buying tickets online. Punters are using the agencies' preferred ordering method, and paying with the angencies' preferred payment method, and being pinged for it.

curiousj

curiousj said on the 15th Nov, 2012

i also think the fact that the cost of the fees are quite often, not mentioned up front, there's usually mention of one or two fees up front, i find it makes me angrier when there's more fees slugged on you when you're about to complete the transaction. you're also forced to use a credit card to pay for tickets. i find it hard to believe that the extra booking fees are the only profit...

doubtfulsounds

doubtfulsounds said on the 15th Nov, 2012

Is there a legal requirement for ticketing agencies to break down charges into credit card fees, handling costs, postage etc? Why don't they just charge a single fee or at worst ticket plus postage. They'd avoid a shitload of grief from punters who rightly or wrongly feel like they are being exploited. There seems to be such a wide range of ticket prices between acts of the same stature playing at similar venues anyway so most people would be oblivious to the built-in charges.

snapcrackleROCK

snapcrackleROCK said on the 15th Nov, 2012

It's actually more like reading a menu in a restaurant, choosing the $30 steak, and then getting charged a $2 gas charge to cook it.

If the ticket is only on sale from one place, there are no excuses for extra charges. Add up all your costs, add the profit you wish to make, and that final number is called a price.

If you need to charge me more, charge me more. Fine. Put the price up. But hidden fees at the end of a transaction is bullshit.

Mr_V1tr1oL

Mr_V1tr1oL said on the 16th Nov, 2012

still a rip-off I reckon.

misscrystle

misscrystle said on the 16th Nov, 2012

Punters are paying for tickets to see a show. Booking fees - small ones - sure, why not. But anything over $5 (and even then I think that's excessive) purely for "handling fees" (postage is another matter) is bullshit. If it costs that much for technology R&D and legal fees, make it an inside charge to the promoters, who I'm sure would band together to squeeze those fees down to a more reasonable charge. Credit card surcharges? Maybe it's fair to charge to a punter because that's a service they're choosing to use by paying that way. The Shonkys were right to call em out.

misscrystle

misscrystle said on the 16th Nov, 2012



There's a legal requirement to advertise exactly what charges apply and what they are for (though charging for 'transaction' AND 'handling' fees on the one ticket are a grey area and personally, I think, fucking shonky) before payment.

sarcasm_mister

sarcasm_mister said on the 16th Nov, 2012

It's actually more like reading a menu in a restaurant, choosing the $30 steak, and then getting charged a $2 gas charge to cook it.



i actually think this is a good analogy. although most venues and agencies do say "Price + booking fee" i think they should at least be made to specify the amount.

Braveheart81

Braveheart81 said on the 16th Nov, 2012

I think a better analogy is that the steak costs $30 and then there is a $2 fee to get it delivered to you.

Whilst for most shows in Australia there is a single main ticket seller, in many cases there are other outlets that sell tickets. Preferred Seating, Fairfax (sometimes in conjunction with Visa or Mastercard or something), various record stores.

I agree that the online ticket sellers should show the booking fees for each option prior to the show going on sale and also show the fee options on the first screen when you are buying tickets so you can calculate how much the actual ticket is going to cost before you get to the end of the transaction.

I don't think that booking fees should be lumped into the original ticket price. I think this results in less transparency and is more open to abuse.

sarcasm_mister

sarcasm_mister said on the 16th Nov, 2012

I think a better analogy is that the steak costs $30 and then there is a $2 fee regardless of whether you get it delivered or pick it up yourself.
.

i think that would be the more accurate statement.

snapcrackleROCK

snapcrackleROCK said on the 16th Nov, 2012

If you're a little record store, and you want to add a couple of bucks to a ticket to make it worth your while, fine.

If the ticket can only possibly be bought from one website, have one, fixed, upfront price. I don't think that's an unreasonable request.

Braveheart81

Braveheart81 said on the 16th Nov, 2012


If the ticket can only possibly be bought from one website, have one, fixed, upfront price. I don't think that's an unreasonable request.

More often than not, this isn't the case. There are generally one or two places selling a limited number of tickets.

snapcrackleROCK

snapcrackleROCK said on the 16th Nov, 2012



Are you sure about that? It's usually exclusively Ticketmaster or Ticketek. They don't sell tix to the same shows.

Braveheart81

Braveheart81 said on the 16th Nov, 2012



There are generally small allocations of tickets sold by Preferred Seating and/or SMH Box Office and a few other suppliers.

You are definitely right that the bulk or tickets are always sold by Ticketmaster or Ticketek and never both for the same show (for events sold by either of these companies).

camthelegend

camthelegend said on the 16th Nov, 2012

i wish there was more competition at the consure level as there is in th uk. it's not just the charges, but tm are a corporate giant with the worst customer service. if they're the only agency selling the tickets to a gig we want to see, then we have little choice but to use them and suffer the consequences. i've lost hundreds of dollars due to their poor customer service. if only i could speak with my wallet more often. i'd be willing to bet there is a fair share of corruption in the industry too. these big companies have a lot of power and we all know how that ends for the consumer. on the otherhand, i have have good experiences with other agencies.

Braveheart81

Braveheart81 said on the 16th Nov, 2012

The consumer in this situation is the promoter choosing the venue/ticket seller they want for their concert tour.

As the concert attending consumer your choice is to which gigs you want to buy tickets for.

FunkyJ

FunkyJ said on the 18th Nov, 2012

there's still something not quite right about this. ok, you have to pass on your increasing cost in wages, technology, and administration to consumers to protect your profit line - fair enough.

but it's only fair if you are operating with no protection and with competition between companies, which your industry is not.

tickets and their sale are protected by laws which prevent re-selling. so i can't decide to buy 10 radiohead tickets and sell them on - even at a loss - and i certainly can't create my own business doing this.

and yes, although there are many ticketing agencies, there is no competition when selling tickets to gigs. for example, i can't get a radiohead ticket from moshtix which may have cheaper fees than ticketmaster, can i?

and, you've completely neglected to mention how australia's biggest ticket sellers are in fact overseas owned, so the majority of profit earned by them goes back to help foreigners, not helping to pay for rising technology, labour and so on...

this is where your justification falls flat on it's face, and shows you and your ticketing masters (like what i did there?) not only to be greedy, but cynically so.

FunkyJ

FunkyJ said on the 18th Nov, 2012

what the hell happened to all my capital letters, faster louder?!?

gumbuoy

gumbuoy said on the 20th Nov, 2012



^Citation needed



Sure you can. You can't use Ebay or any of the major sites to do it, but the few days before the show, I saw lots of facebook/twitter messages from people looking to buy/sell tickets. Certainly you can't create your own business, but why should you?



So overseas companies don't need to invest in technology if their market is here in Australia? Or even if it's overseas?



People with <50 posts don't get capitals, until we're sure you're not a filthy spammer.

Given the below line,



I'd say the jury is still out...

charlesmorley

charlesmorley said on the 20th Nov, 2012

i'm with snapcracklerock. i don't need a breakdown of the fees (conveniently presented at the end of the sale), just tell me the total price, at the start. the fact that not all tickets are sold from a particular outlet doesn't preclude a given outlet from advertising the total cost of a ticket purchased from them.

or if they're going to keep going the current way, why not go further? break it down into what the band costs. and then the venue, and security, and the cost of their accountant, or whatever. and then just tell us how much profit they'd like at the end.

as a fine example of how this kind of practice is frowned upon in other industries, it is now illegal to advertise domestic flight prices that do not include airport taxes, fuel surcharges, etc, because people realised that, while there are various costs to doing business, as a consumer, i don't need to know each one, and it's a retailer's job to add up the total.

billymumphrey

billymumphrey said on the 28th Nov, 2012

so apparently booking fees cover %u201clabour, dispatch, handling and the cost of technology that supports the scanning of these tickets%u201d.

which is all well and good if the ticket agencies were actually providing a decent level of service. which they don't.

for example when the black keys cancelled their tour a few summers ago i had to physically go down to the local ticketek office to get information on what i needed to do to secure a refund because

a) their website and it platforms provided no information (the same platforms we are being told are financed by our booking fees)
b) i couldn't actually talk to an actual person on their telephone line, you know you same people who's costs are being provided by our fees.

provide a decent level of service and i'll be happy to pay for your booking fees, but until they do i think i have every right to complain, especially when they take my cash for tickets instantly, yet take a few days to process a refund.

Crasher_2012

Crasher_2012 said on the 4th Dec, 2012

great read. some people are absolute dimwits!

people fail to see that booking fees / handling fees etc are the ticketing agencies source of income. the ticket price aka face value, is a price nominated by the promoter / artist and in 9/10 cases, 100% gets settled straight to the promoter / artist. if there were no booking fees, there would be no income for the ticketing agencies, thus they wouldn't exist, there would be no one to ring when you lose your tickets or a show gets cancelled, there would also be no easy way to find out what show is coming to a town near you soon..... all of these things are labour intensive, and please don't be surprised.... but people don't work for free.....it's simple logic really.

oh and for the guy who asked "why the service charge varies" this is often to do with the promoter / artist. often the promoters will nominate a service charge as they will want their little cut.

mattjamesaus

mattjamesaus said on the 6th Dec, 2012

a great read!

i currently work at ticketbooth an aussie ticketing company and it sucks when fans get worked up about booking fees - surprisingly the amount of profit made from fees after staffing costs, credit card costs, web developer costs, server costs etc is actually quite low.

rissiec

rissiec said on the 6th Dec, 2012

it is a reality that there is going to be a booking and credit card fee but as previously mentioned by others just give us the cost of the ticket and nothing else to simplify the process. everyone will bitch less about buying tickets

Braveheart81

Braveheart81 said on the 6th Dec, 2012

I'd be interested to find out whether booking fees are higher for big tours that lots of kids attend (such as One Direction or Bieber) because there ends up being lots more customer service required (parents buying the wrong tickets for their kids, kids using their parents credit card then struggling to pick up the tickets etc.)

Based upon the information available (and the fact that booking fees vary from show to show amongst the same ticket vendor), it seems that the promoter can choose different levels of customer service/extras that are built into the booking fee.

I am pretty sure there would be substantial differences in the amount of customer service required based on the particular demographic of each show.