Dynamic pricing by Ticketmaster to blame for higher concert ticket prices
Posted August 18, 2022 3:02 pm.
Last Updated August 18, 2022 6:05 pm.
Thousands of Toronto Harry Styles fans are still buzzing from two nights of their favourite artist, but many others were left defeated by the high-ticket prices for the shows.
These prices are a part of Ticketmaster’s dynamic ticket pricing model which the ticket agency says is now considered the industry standard for the vast majority of reserved seat shows in the United States.
One Harry Styles fan said when she tried to find tickets the first day they went on sale, ticket prices were already listed for up to $1,500 for floor tickets and up to $900 for tickets in the 300 sections by the time she got through.
Gillian said she was eventually able to purchase tickets for just over $200 the day of Styles’ Monday night concert. She tells CityNews it was the worst experience she’d had buying tickets.
“I’ve been going to concerts since you had to call Ticketmaster or lineup at the record store that sold tickets to get them. I’ve never seen Ticketmaster use such disgusting practices in terms of inflating pricing based on demand, especially in a time where we haven’t been able to go to concerts for two years,” said Gillian. “To put prices at hundreds and thousands of dollars when people just want a chance to see someone that makes music that brings them joy, I think it’s really predatory that they’re just trying to make more money off the backs of us who are using our hard-earned money just to have an opportunity to see this firsthand.”
Another fan, Joanne Belliveau, who flew in from Nova Scotia to catch her favourite artist in concert was able to snag tickets for $200 early through an American Express program, but friends of hers from across the country weren’t able to afford what tickets were left.
She’s been to one other Harry Styles concert but said getting tickets was like “the Hunger Games.” Belliveau tried herself to get tickets for some friends but when she tried to purchase them, it would say they had been sold and shortly after, come back at $1,000.
“We absolutely love Harry and we don’t want him to be upset, [but] Ticketmaster needs to fix it so that it is easier and more affordable for fans to be that lucky to go see him,” she said.
A man who has been to around 100 Bruce Springsteen shows didn’t end up buying tickets for his upcoming tour in New Jersey because of the astronomical prices.
“When I tried to get tickets for a couple of shows, I was so disappointed in the cost that it was so out of control. It was almost absurd,” said Gord Hunter. “It started me down a path of trying to understand how a guy who represents blue collar people and represents working class people could tacitly approve this kind of pricing that essentially gouges because of demand.”
Hunter said ticket prices ranged anywhere from $800 for a really bad seat to $4,000 to $5,000 for reasonable seats. The most he’s ever paid for a ticket was $250.
Currently, tickets available on Ticketmaster have a face value of up to $1,950 for floor seats. The cheapest tickets available that weren’t resell tickets were $525. The lowest resale ticket being offered was for $223 in the 300 sections.
Dynamic pricing is similar to surge pricing on rideshare apps, in which pricing is set by the expected demand, according to marketing professor David Soberman.
“They basically have historical trends depending on the attendance at the concert, about the number of tickets they need to sell each day, in order to sell out shortly before the concert takes place,” he explained. “So you use historical information as a way of guiding the prices that are set in the present.”
He said most of the time, it lends well for eager concertgoers to either purchase tickets really early or really late.
“It’s a better idea to buy early, but if for some reason the concert is not highly popular, and you notice that there’s a trend going down then you can also wait so all of these things are possible and depends on your patience and whether or not you are willing to accept the fact that you might actually be wrong,” said Soberman. “All of this is guesswork.”
Soberman said he empathizes with those who are complaining about ticket prices but adds it’s not an essential item.
“It’s kind of frustrating for them, but I also don’t see concert tickets as an essential item. So if we were talking about milk, butter, bread, or shelter, these are different things. That concert is really a discretionary item and so it seems reasonable that the seller should be allowed to price at whatever the market will bear.”
But does the model do anything to stop scalpers, something ticket websites have been attempting to do for years.
“The main way that scalpers make money is by buying large quantities of tickets, and then by arbitraging afterwards,” said Soberman. “So probably the number one way to sort of limit scalping is to limit the quantities of tickets that an individual can buy and I think many of the concert presenters tried to do that.”
Ticketmaster tells CityNews that promoters and artist representatives are the ones who determine the pricing strategy and range on all tickets including dynamic and fixed price points after the ticket agency shares their data to help quantify supply and demand.
“Dynamic pricing is about capturing more value for the artist at the initial on sale versus that value going to people reselling tickets on the secondary market. Similar to airlines and hotels – prices adjust up or down based on demand,” Ticketmaster said in a statement.
“On some level I feel betrayed,” said Hunter. “[Springsteen], at one point, I remember in the midst of the pandemic, he had a radio show. And I was listening to it and he said,’You know what, when this thing’s over, and it’s going to be over when it’s over. We’re going to have a big party and everyone’s invited.’ Well, that feels like a lie to me. No, we’re not invited. You’re invited if you have a tremendous amount of disposable income.”
The Competition Bureau said they are not able to discuss whether any complaints regarding Ticketmaster’s dynamic pricing have been filed.
“Businesses are generally free to set their own prices. Charging high prices is not illegal in itself, and the Competition Bureau does not have the authority to regulate prices,” read a statement from the Bureau.