National reopening plans, pent-up customer demand and digitalisation will all contribute to the revival of the live events sector, according to Joe Berchtold, President of Live Entertainment.
The head of the world leading event promoter cited the UK government’s announcement of a roadmap to lifting lockdown in England as a great enabler to reopening the events business.
“The UK is the leading example of what’s working well. They got out fast with the vaccines. They came out with a plan last week,” he told Morgan Stanley’s Technology, Media & Telecom Conference on 4th March.
Subject to the progress of the virus and vaccination, the UK aims to remove all lockdown restrictions in England in a phased approach by 21 June. “Because we have those dates, we can make an informed decision. It has a big impact on consumer side.”
The announcement of the roadmap created a rapid surge in sales of festivals, with Live Nation selling 170,000 tickets in three days, including Creamfields and Reading and Leeds which sold out rapidly.
“We needed a 90-day plan that gives the ecosystem the ability to plan.
“We’re waiting for that in the US, or if not on a state-by-state basis,” he said. “It looks like the south is moving fast. And there are more aggressive plans from some of the big states like California and New York; others are more conservative.”
Fortunately outdoor events, which reopen soonest due to the lower risk of transmission, serve the promoter’s biggest customer base. “The benefit for us is the large volume of fans. our most valuable customers are our fans in amphitheatres and our festivals. That’s the best way for us to economically get moving.”
With pressure building on both the supply and demand side, Live Nation’s post-pandemic strategy is to drive more fans into its ecosystem and monetise more effectively.
“We are looking at an elevated supply and demand as we come out of this. We have a very large pent up supply issue,” he said, highlighting a roster of big name artists who have been unable to tour during the pandemic.
“You have latent demand of people wanting to see artists. 95% of fans want to go as soon as they can – so we’re going to have an accelerated supply and demand dynamic.”
Although Live Nation’s revenues were hit dramatically in 2020, their cost base has also reduced.
“We’ve took $950 million out of our cost base last year, and we’re putting $750 million back in. So that’s making us nimbler and more effective.
The promoter is also looking for new revenue streams.
“We’re looking into streaming. There are fans out there that are not going to be able to go to the show, if it’s not in their city or if it’s sold out, who will buy a stream. We can very efficiently provide our thousands of artists with the option of adding a stream to a show or a tour.
“Most people want to go to the show rather than stream, which reinforces the value of the live proposition. But there are a lot of people who just can’t make it. so it opens the scale of distribution on a global basis. For most artists it will be integrated into touring – an additional element of their live show.”
The pandemic is also accelerating the deployment of digital ticketing. “People will go into the venue on a ticketless basis. This will improve the fan experience and reduce friction. If you reduce friction, you’ll sell more food and beverage and merchandise. That will have direct benefits for the fan, for the venue, it helps us to know and understand our fans, to add value to the sponsors – so the whole system starts to work better.
“Across the whole business, we’re finding ways to do it better.”
Future growth will also be driven beyond the UK and the US. “We’re doing this on a global basis in 40 countries. We have teams in all the markets, taking a market by market approach.
“We are excited about new markets and how they come out of this.”
These comments were made in conversation with Ben Swinburne, Head of U.S. Media Research at Morgan Stanley
Tag: Entertainment
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Vaccines and streaming will drive live event growth – President, Live Nation Entertainment
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Coldplay targets net-zero emissions on world tour
Coldplay aims at reducing emissions related to their next world tour by 50 per cent, and to remove the remaining unavoidable emissions with a portfolio of carbon removal solutions.
“Playing live and finding connection with people is ultimately why we exist as a band,” said Coldplay.
“We’ve been planning this tour for years, and we’re super excited to play songs from across our whole time together. At the same time, we’re very conscious that the planet is facing a climate crisis.
“So we’ve spent the last two years consulting with environmental experts to make this tour as sustainable as possible, and, just as importantly, to harness the tour’s potential to push things forward. We won’t get everything right, but we’re committed to doing everything we can and sharing what we learn. It’s a work in progress and we’re really grateful for the help we’ve had so far.”
Nature-based carbon removal solutions to be used include reforestation, soil restoration, rewilding, and blue carbon projects, such as seagrass meadow restoration. Other solutions include sustainable aviation fuels, and a direct air capture and storage solution from Climeworks – the only technological approach included.
Christoph Gebald, co-CEO and co-founder of Climeworks said: “It is already proven that carbon removal at scale is a must on the current emissions pathway and technological solutions will be needed.
“We are very inspired to see public figures like Coldplay seizing the magnitude of the challenge and acting boldly by working towards ambitious emissions reduction and removing the unavoidable part. Supporting them with our carbon dioxide removal service takes us one step closer to our vision of inspiring 1 billion people to remove CO2 from the air.”
To limit global warming to 1.5°C, humanity needs to drastically reduce emissions (also called mitigation), which prevents new CO2 from entering the atmosphere. Historic and unavoidable emissions must also be removed from the air to achieve net-zero and net-negative emissions globally.
According to Climeworks, some scientific studies indicate that by mid-century 10 billion tons of CO2 will need to be removed from the air every year to keep global warming in the line of the limits of the Paris Agreement. -
“Festivalisation” divides opinions at SportAccord
In this age of constant access to entertainment, sports events are under pressure to become ever more entertaining and offer more activities within the schedule. But is this phenomenon of festivalisation – part of the DNA of mega events – a good thing for smaller events?
“It’s definitely a good thing for promoting and reaching out to new target groups and bringing communities together and entertaining them,” says Georg Spazier, who brought several events to the Region of Tirol following heading up marketing and communications at the 2012 Youth Olympic Games Organising Committee Company. He is now running his own agency, ITS GR8, with which he organises Europe’s biggest mountain bike festival.
“But for organising committees it’s additional work, additional budget, additional staff and coordination and so on. You probably need an extra team running it. If it’s the one organising committee, doing everything can be overwhelming in many ways.
“There is a threat that sport moves out of the spotlight. We have to look at it more from a holistic entertainment perspective.”
The 2023 Olympic and Paralympic Games will incorporate a number of different cities beyond Brisbane, the nominal host. “I think it’s great thing because I think it just gives more cities more opportunity,” says Alana Vought, Program Manager, City of Gold Coast’s Olympic and Paralympic Games Brisbane 2032.”
Involving wider regions can help to involve more diverse communities and in events, especially those communities that lack sports infrastructure, Vought says. “The Pacific islands have no training infrastructure at all. So to be able to bring some training camps into the country, to Australia, into the Gold Coast and have them train – it’s a great opportunity for them and it’s also a fantastic opportunity for our athletes to share.”
Birmingham, in the UK’s West Midlands, hosted the Commonwealth Games in 2022. “Festivalisation was good for Birmingham because it suited what we wanted to do with the Games, and that was could we involve more communities and different types of audiences,” says Nicola Turner MBE, CEO, United By 2022, who was Director of Legacy for the Games.
Birmingham 2022 wrapped a cultural and festival event around the Games for six months. “We eventually sold more tickets for the cultural and arts festival than we did for the Commonwealth Games itself, and actually then the community decided to put on Festival 23 the next year because they liked it so much.”
Triathlon is a sport which has seen huge rise in in popularity, and the events are getting bigger and bigger. This brings challenges as well as commercial opportunities, according to Kris Gemmell, Head of Marketing and Commercial, World Triathlon.
“There was an opportunity to give sponsors more bang for their buck, and they had more time to activate, but it was taxing for them to be in one place for a greater length of time,” he said.
“The question is, how big is too big?”