[00:00:00] James: Welcome to episode 184 of the Bandhive Podcast. It is time for another episode of the Bandhive Podcast. My name is James Cross and I help independent artists tour smart. This week on the show I'm gonna talk about venue and ticketing fees. It's a hot topic that honestly, I. I totally agree with people for the excessive fees on larger shows, but when it comes to smaller shows, there are some fees that you need to understand and they're really not unreasonable.

[00:00:29] James: So hopefully going through them in this episode will give you some peace of mind into what those ticketing and venue fees actually are. from an artist's perspective, ticketing fees actually help you. So being against fees as a blanket policy is probably not the best move to take now, before you start tuning out or yelling at your phone or whatever device you're listening on, hear Hear me out here. This whole episode is going to be about why these fees aren't always [00:01:00] terrible and how they can benefit you. Now, when it comes to fees that we've seen rising in recent years, there are two main reasons for this technology and administration. Now this is, especially for these ticketing giants like Ticketmaster, where they have ridiculously high fees.

[00:01:18] James: I am not a fan of those fees. We're talking like 30 to 50% of the ticket price. That is excessive and there's no doubt about it. But the thing is, they are doing this because not because they have a giant staff or because they are constantly developing new things, which yeah, they are doing those things.

[00:01:37] James: But they also have a pretty nice profit margin. They are part of Live Nation, which is publicly traded, so you can look up all the public numbers for what these companies are earning every single year. That said, technology and staff are very important because when you get to these larger levels, you need customer support.

[00:01:57] James: You need technology that is keeping up with the [00:02:00] times, trying two defeat bots, we all know they're very bad at it, but if they weren't trying at all, it would be so much worse for music fans around the world. One other reason is that ticketing fees on top of the ticket price avoid cutting into artist pay.

[00:02:13] James: Now, whether that's a service fee, a facility fee, or just a sales fee, whatever it is, There are many different types of fees, and this is part of why fans get so upset because they're already paying a service fee. Why should they pay a facility fee and then a sales fee or a credit card fee or whatever.

[00:02:31] James: It all adds up, and even though fans want transparency, and that's why there are line items for every fee That transparency just makes the fans say, why am I paying multiple fees? Shouldn't there just be one fee? And they might have a point there.

[00:02:44] James: But it all depends on the venue, the location of the event because of local taxes and fees.

[00:02:49] James: And of course the ticket provider is going to be a big factor in what fees you pay as well. When it comes to playing shows, you don't want to have excessive ticketing fees because that is going to [00:03:00] potentially harm the relationship with your fans, and you want to build a positive relationship with your fans.

[00:03:05] James: So let's talk about when they become excessive. The first thing, obviously, we've all heard the horror stories. Ticketmaster charging like 50% fees in total on a ticket that is just excessive. Sometimes it's venues trying to maximize profits by adding sneaky fees onto there, which aren't actually ticketing fees.

[00:03:23] James: It's more like the venues fees. Sometimes we see this called a facility maintenance fee, which is a fair fee to include, but only if it's not excessive. So, One example here is at a venue that I promote shows at. There is a 50 cent per person facility maintenance fee. To me that is totally reasonable and that is built into the ticket price so the fans don't even know they're paying it.

[00:03:45] James: And what that does is it covers paper products, it covers cups, all that kind of stuff because this venue gives out free water as all venues should. And thankfully, we're seeing that more and more that venues do have cups and cold water available, but that's what this 50 [00:04:00] cents per person goes to. It covers the costs of what they use while they're in the venue.

[00:04:04] James: To me, that's totally unreasonable. But at some other venues, we're seeing facility maintenance fees of $5 or more per ticket, which is just ridiculous. If a third party promoter is running that show, then the venue is already collecting rent.

[00:04:18] James: there should be no need for a facility maintenance fee because they're getting that rent, and that should be built However, if they're promoting it in-house, then okay, facility maintenances fee, yeah, that's fine, but make it reasonable. No one's gonna be using $5 worth of toilet paper or paper towels, or water cups, whatever it is.

[00:04:37] James: No single person is going to use that much. And you know what? Even if somebody did, guess what? Everybody else is gonna be using like 20 cents of those products, so it all evens out. Just don't worry about a facility maintenance fee. If you're at that level, it should be less than a few dollars. if it's $5 or more, don't allow that in your final settlement. If the venue is trying to [00:05:00] charge that as a ticketing fee that's passed on to customers trying to negotiate that out, maybe they will, maybe they won't.

[00:05:05] James: It's really tough to negotiate things like that. But if it's in your offer and it's more than a dollar or two, get that out of there. That should not be in there as a show cost at that price. It should be, at most a dollar or two per person. Now here's the thing. If the facility maintenance fee is built into the ticket price, then it is coming out of the band's pay.

[00:05:26] James: If it's passed on to the fans, then it's an extra cost for the fans, and this goes for any ticketing fee really. Now, this is why it's a huge advantage for these fees to be on top of the ticket price, because because if they're included in the price, then the band is.

[00:05:41] James: Losing that money, that income on every ticket sold. and this is why I think it's totally unreasonable. When fans say that the fees should be included in the ticket price, they don't understand the accounting. I get that. But they're asking would directly affect the artist's income.

[00:05:56] James: And yes, you could raise the ticket price, but at the same time, [00:06:00] if it's a percentage, then you raise that ticket price. And now the fees are going to be higher because you raised the price. The math just does not work out there. Now, there's all kinds of unethical things that can be going on.

[00:06:11] James: There could be hidden fees or lack of transparency. You know, the bots are buying tickets and they are inflating the prices and reselling them. All of this stuff is nasty, and that is actually something that ticket fees help avoid. Again, going back to technology and administration. The big ticketing companies try to put steps in place to prevent the bots from scooping up these tickets and selling them all at an incredibly inflated price. Again, they're not great at it, but it's a lot better than if they didn't try it all. Same thing with scams and counterfeit tickets.

[00:06:43] James: These ticketing fees help to reduce the amount of scams and counterfeit tickets. So in a way, it's insurance. You are paying these fees or your fans are paying these fees, and that money, in theory is being invested into more secure ticketing systems. [00:07:00] We've all seen this, tickets are usually digital now, and if you go to the Ticketmaster Live Nation app, they have that like little moving barcode.

[00:07:06] James: That's security that cost a lot of money to develop, and that's what those fees, at least in part go to. Now, one other thing that I wanna touch on here is dynamic pricing. This has been such a debated topic and so many people get it wrong. So many. I remember back about six months ago, seven months ago, when the Taylor Swift tickets went on sale.

[00:07:27] James: There was outrage all over the internet. Live Nation and Ticketmaster because these ticket prices were so high. Well, I have news for you. The artist has to opt into dynamic pricing. This is not a Ticketmaster problem. This is a that Ticketmaster has created and the artists have chosen to use.

[00:07:47] James: So if your favorite artist has dynamic pricing, well, there's no one to blame. But the artist, they could have said, we don't want that. Keep it turned off. But they opted into this dynamic pricing because guess what? [00:08:00] They can earn more money. And before you say, well, James, the ticketing company is earning more money too.

[00:08:05] James: Yeah, they are. But the actual face value of the ticket in that dynamic pricing goes to the promoter and is then split up between the promoter and the artist once costs are covered. the only way that the ticketing company profits on dynamic pricing is because their fees, at least some of them are a percentage based fee.

[00:08:24] James: That means if the face value of the ticket is higher, then the fee is higher, and the ticketing company can collect more money on those fees. But if you see a ticket that started at $200 and is now going for 1,000 or 5,000 or whatever that face value is not going to the ticketing company that is going to be paid out to the promoter of the local event.

[00:08:47] James: So again, Do not be mad at Ticketmaster and Live Nation for creating these tools because the artist had to opt in to use them. So if you're upset at anyone, be [00:09:00] upset at the artists who enable these practices because they are literally saying, yes, we want dynamic pricing because we'll get more money.

[00:09:07] James: And you know, I'm all about artists getting paid more, but why not just increase your ticket prices a little bit across the board rather than letting some people get tickets for a few hundred dollars and others for 10,000 or more. That's ridiculous. We saw this with the Cure just a couple months ago.

[00:09:22] James: They said, wow, these fees and dynamic pricing is excessive. and they actually got Ticketmaster to issue refunds to customers in cases where they deemed the fees were too high.

[00:09:32] James: That's amazing. And that shows the power of a big artist like the Cure. Now, they're not Taylor Swift level, but if Taylor Swift had said, no, we're not doing dynamic pricing, and by the way, your fees are too high, guess what? Ticketmaster Live Nation, they would've folded. They would've said, okay, you know what?

[00:09:47] James: We'll cut some fees out and we'll turn off dynamic pricing. It's that simple. The artists who choose to stand up for their fans do, and the artists who are motivated by money. Well, they turn on dynamic pricing. So even [00:10:00] though dynamic pricing isn't necessarily a fee, it's something that I wanted to talk about because a lot of people do think it's a fee and it's not. So if you want to avoid having your fans, even at local shows, paying excessive fees, there's a few things you can do. The first is try to negotiate with venues and say, Hey, We know you have this ticketing company and they have fees.

[00:10:21] James: You can't change that. Well, what if for this one show we used an alternate ticketing platform just for our fans on our site, you can give us, let's say 20 tickets or however many you think you can sell in that market. We'll sell them on our platform, on our web store, and give you the money, and you can put 'em in as guest list tickets.

[00:10:42] James: You've gotten the money, but the platform is gonna allow you to do guest list tickets, right? So let us give you this list and the money that we collected, how's that sound? And if you're lucky, the venue will say yes because you are coming to them with a solution. Now, one thing I wanna warn you about is if you're gonna take your credit cards on this, [00:11:00] Then you want to absolutely build in your credit card fee so you're not losing money on this deal, cuz that's just not good.

[00:11:06] James: So most credit cards are about 3% fees and a 30 cent per transaction. sometimes it's 50 cents per transaction. Now, either way, that's perfectly easy to just build into the face value of the ticket that you're charging And you can advertise, Hey, this ticket doesn't have any fees.

[00:11:21] James: Go ahead, buy it $16 instead of 15 on the venue, whatever. Most people aren't gonna notice, and if they do and they ask, you can say, oh yeah, that's just because we do have to cover credit card fees, which it's still gonna be much cheaper on our site for $16 versus the venue site where it's $15 plus $7 in fees.

[00:11:37] James: Ultimately, if it's a low fee, like venue that I promote shows at, the fees are typically two to $3 per ticket. That's nothing that is so incredibly cheap, and honestly, that is a fair fee because the venue is using a ticketing provider and that ticketing provider has to make money somehow. They have to cover their credit card fees.

[00:11:55] James: All of that adds up. So 10, 15, 20% fees. That's [00:12:00] fine. If it's 30 to 40 or maybe even 50, that is where it gets excessive. One last thing to mention is a lot of states do require sales tax on live entertainment. So if you get hit with sales tax at the box office, don't complain about that. There's nothing the venue can do about that except break the law. That doesn't make any sense you don't go to the grocery store and complain that. Whatever gets taxed in your state has tax on it. Like here in Vermont, you don't pay tax on unprepared foods, but if you go to like the sushi counter and pick up a box of sushi that has tax on it, no one says, oh, what is this hub tax?

[00:12:35] James: It's food. No, you're not gonna ask the store to break the law. So why would you walk into a venue tell the venue that you don't wanna pay tax or worse, would you ask them to waive the tax for you and expect them to take that out of the cost of the ticket.

[00:12:50] James: Now you're actively taking money out of the artist's pocket, so why on earth would you do that? If you like a band, you should be there to support them. again, I'm not a fan [00:13:00] of ticket fees in any way, but. I understand them, and I'm trying to help you understand why they are a necessary evil in the music business.

[00:13:08] James: If they're excessive, forget about it. I'm totally against that. But at the very least, if your local venue is charging a dollar or two, maybe three in fees on a 15 to $20 ticket, don't argue about it. and if it's excessive, if it's like a $15 ticket with $7 in fees, talk to the venue about it and say, Hey, what can you do to make this better for future shows without cutting into artist pay?

[00:13:30] James: If it's a show you're playing, ask the venue if you can sell tickets on your own site and move them that way. So the fees are lower. There's always ways and you can talk to the venue instead of just complaining online. So try to work out something that works for all the parties involved. Doesn't violate any deal terms that the venue might have signed or maybe that you signed, but make this a discussion and again, pick your battles.

[00:13:53] James: If it's only a couple dollars in fees, it's not worth it. It really isn't, because then you're just wasting time and energy on something that [00:14:00] in the big picture, doesn't matter. That does it for this episode of the Bandhive Podcast. Thank you so much for tuning in and listening, and I hope that this episode has shed some light onto how ticketing fees work and why sometimes they're a good thing, especially for artists and venues, Please. If you have any questions or any confusion about this, let me know.

[00:14:18] James: Head on over to our Facebook [email protected] slash group. That'll automatically send you to the group, or you can search for Bandhive on Facebook and join the discussion there. We have a thread for every single new episode where we can discuss the topic of that episode.

[00:14:32] James: You can ask questions, share your thoughts and opinions, whatever it is, because this is really something important for artists to understand. If the ticketing fees are excessive, yeah, that's not good, but if it's a few dollars, a small percentage, that is totally understandable because we're dealing with businesses here.

[00:14:49] James: Bans our businesses as well, and asking another business to take a loss on you is simply not fair to that business. They are providing a service to you, so [00:15:00] again, reasonable fees, that's totally fine. Excessive fees not okay, but don't argue about the reasonable fees.

[00:15:07] James: That just makes you look bad, makes you look whiny, and makes you look disrespectful to be honest. So don't do it. It's as simple as that. We'll be back with another brand new episode of the Bandhive Podcast next to Tuesday at 6:00 AM Eastern, right here in your favorite podcast app.

[00:15:21] James: then, I hope you have a great week. Stay safe, and of course, as always, keep rocking.