In recent years you might ve noticed that the options for buying tickets to concerts, sporting events, and theater have been expanding. First there are the venue box offices and event promoters, which sell seats directly to the public. Next comes what s called the primary market, including giants like Ticketmaster that contract with venues and promoters to sell seats at their events. Finally and this is where things get really confusing there s a growing secondary market for reselling tickets, including sites like StubHub (a Craigsliststyle marketplace where people can sell tickets they ve bought) and Onlineseats .com (which buys tickets for resale to the public).
The primary market is still the most common way to get tickets; it brought in $21 billion in 2007, versus $5 billion for the secondary market. But by 2012 the latter is expected to double its sales, according to Forrester Research. The problem is, the resellers market is the Wild West of ticket sales, rife with opportunity as well as scam. And most folks don t even know there s a difference between primary and secondary sellers, says TicketNews.com publisher Crystal Astrachan. The upshot: When buying tickets, what you don t know can hurt you.
A major reason for the growth of the secondary marketplace is the fact that people are willing to pay big bucks to see their favorite artists or teams perform. According to Forrester Research, three out of five consumers paid more than face value when buying tickets online through a secondary seller. Right now ticket prices simply aren t set as high as what they re worth on the open market, says Sucharita Mulpuru, a retail analyst at Forrester: That s why you have a second market. Take the Super Bowl. Tickets to the 2008 game went for an average $3,540 on StubHub, versus $700 and $900 at face value.
The recent relaxation of antiscalping laws in 44 states including big ticket issuers like California, Nevada, and New York has contributed as well, basically providing a free market for resellers. But that s not necessarily a good thing for consumers, says Mulpuru, who warns that eventually the primary market will catch up and start charging more. That s where this is all headed, she says. So what s the safest route for consumers? Stick to the box office or Ticketmaster when possible, until the ticket industry sorts itself out.
The secondary market has been a boon to season-ticket holders who want to sell their seats for a profit. Sean Pate, corporate communications head for StubHub, estimates that 60 to 70 percent of sports tickets on the site are from season-ticket holders. But there s an important variable when it comes to price: Is the franchise any good? Seats for the Boston Celtics, one of the hottest teams in the NBA in the 2007 2008 season, went for an average $97 on StubHub, a 48 percent increase over average face value, according to Team Marketing Research. But owners of Miami Heat seats, one of the league s worst, were lucky to break even, Pate says.
The real money is in NFL tickets, says secondary reseller RazorGator s CEO Jeff Lapin. Resale prices for football can easily be double, triple, or, in the case of the Green Bay Packers, four times face value. If you happen to own season tickets to the New England Patriots, note that the team allows only face-value resale to people on its waiting list. We state clearly that the reselling of tickets is a revocable offense, says a Patriots spokesperson. But that hasn t stopped the flow of tickets. They re one of our bestsellers, says StubHub s Pate.
Ticketmaster, the largest ticket seller in the world, sold an estimated $8.3 billion worth of tickets in 2007, roughly 40 percent of all ticket revenue in the primary market, according to Mulpuru. But with the secondary marketplace on the rise, Ticketmaster has hedged its bets by creating its own fan-to-fan ticket-reselling platform, TicketExchange, and purchasing TicketsNow, the thirdlargest online reseller. Ticketmaster has intentionally tried to vilify the secondary market for years, making it seem like an underground black market, says Pate. But buying TicketsNow validates the growth and future of the secondary market.
The result? Sean Moriarity, president and CEO of Ticketmaster, says the move will allow us to provide a safer, more reliable and efficient resale experience. Indeed, Ticketmaster s new involvement in the secondary market has introduced more consumer protection there. But make no mistake: You ve got to be very, very careful when buying tickets for big-time events, says Stephen Happel, professor of economics at Arizona State University. Make sure the fine print says you re guaranteed a ticket.
Out-of-town visitors to the Great White Way are often the least-savvy ticket buyers especially when they go online. Some have shown up at venues with tickets bought from secondary brokers for over $100 when their face value was under $30 and seats were still available from Telecharge.com or the box office, according to Alan S. Cohen, director of communications for trade association The Broadway League.
Part of the problem is the size of Broadway s theaters, which have from several hundred seats to 2,000 tiny compared with sports stadiums or amphitheaters. While there are fewer seats, the same number of brokers are snatching up tickets for the hottest events, jacking up prices. Another factor is the falling dollar, which has spawned an influx of international tourists to New York. According to The Broadway League s annual report, show attendance by foreign visitors rose almost 40 percent from the 2006 to 2007 season. So what s your best bet for scoring seats? Cohen suggests the theater box office or primary source www.broadwaytickets.com. If you don t mind the line, you can also get up to 50 percent off tickets at one of the TKTS discount booths in New York.
Surprised that a 13,000-seat venue can sell out within minutes? So were the angry moms who tried to buy tickets to Hannah Montana s Kansas City, Mo., concert in September 2007. It turns out they had a reason to be furious: Only 4,000 seats were made available by promoter AEG to the general public on the initial on-sale date. (An AEG spokesperson says that s because the stage design wasn t set yet, and it wasn t clear what seats would be obstructed.) Of the rest, 4,000 tickets went to fan-club members; 1,600 went to various promotions, sponsors, and comps; and the remaining seats were made available after the stage design was set.
Events are never truly sold out, says Pate. Even when an event is listed as such with Ticketmaster, for example, there s still a chance for you to snag tickets from a primary source. Check back often as the date draws closer, since some of the outstanding tickets should eventually become available. Unfortunately, there s no rhyme or reason to how many seats will pop up or when, and it varies by event. But you can always try the secondary marketplace if you have the stomach for it.
The online portion of the secondary market for tickets is expected to top $4.5 billion in 2012, so it s no surprise that opportunists are trying to claim their piece of the pie. Complaints about ticket brokers to the Better Business Bureau jumped 149 percent from 2002 to 2006. One of their biggest cons: advertising seats as located in a good section when they re actually in the nosebleeds.
Industry experts say the best way to protect yourself against fraud in the secondary market is to use a reputable resale platform, like StubHub, or a direct reseller, such as Ticketmaster s TicketExchange. And pay with a credit card or via a system like PayPal; it means added protection and maybe even your money back should there be a problem with your tickets.
If you ve ever bought tickets from Ticketmaster, you might wonder why you re asked to retype a wonky string of letters as part of your order. It s actually a vital security measure that prevents automated computer programs from gobbling up all the tickets to an event. But even that s not enough to keep the pros from gaming the system. In 2007 Ticketmaster sued RMG Technologies, claiming it provided software that circumvented security and allowed brokers to cut to the head of the virtual line. The case is still pending, but RMG President Cipriano Garibay maintains the company did nothing wrong. Ticketmaster underestimated the efficiency of our system, he says.
Even when everybody plays by the rules, it still seems secondary brokers are winning out over consumers. It s a matter of sheer volume: There are at minimum 1,000 secondary brokers out there, each of which may have anywhere from one to 100 people working for them whose job it is to score the maximum number of tickets for any given event as quickly as possible. How to play against the pros? Think like them. Be poised and ready at the keyboard the precise moment tickets go on sale, and hit the purchase button the minute the sale begins.
Tickets to see the Dave Matthews Band at the Tweeter Center in Mansfield, Mass., on June 24, 2008, were scheduled to go on sale to the general public on March 29. But oddly enough, on March 20 there were already 195 tickets available on the TicketsNow site even though the brokers advertising there didn t actually have those tickets yet. It s the same thing that happens with every big concert, says Mike Joliat, marketing director at brokerage site SelectATicket. com. As soon as it s announced, brokers list tickets even though they don t have them. ( The tickets on our site are owned and supplied by over 800 different licensed ticket brokers, says a TicketsNow spokesperson. They have to deliver that ticket at that price. These folks that we let list on our system know what they re doing. )
The practice is very unethical, says retail analyst Mulpuru. It s done to assess whether there s a market for the particular event and how hard the brokers should pursue the tickets. Case in point: Lawn seats to the Dave Matthews concert listed on TicketsNow prior to their on-sale date ranged from $65 to $225, notably higher than their $40 face value. All they re doing is guessing what they think they can sell the ticket for, says Professor Stephen Happel. The prices start out real high, then as the event gets closer, prices start to come down.
Ticket-starved New York Giants fans who made the trek to Arizona to watch their team play in the Super Bowl in February 2008 had the chance to get a big discount on tickets if they were willing to wait until the day of the game. Faced with the possibility of getting nothing for their tickets, street scalpers were selling seats for $1,000 that they had originally wanted $2,600 for. It s open trading on game day, says Happel. Your best bet is to go an hour before the game and take your chances. You can typically get tickets for face value or less.
Of course, there are always risks involved with buying tickets curbside. Steve Arena found that out firsthand when he bought three tickets for $900 outside the FedEx Forum for him and his two sons to watch a University of Memphis basketball game. When they got to their seats, the real ticket holders informed them they were the third or fourth group to show up with the same bogus tickets. Arena and his sons opted to roam the halls watching the game on the screens and standing in the aisles until someone asked them to move. Counterfeit tickets are always going to be a worry, says Marianne Jennings, professor of legal and business ethics at Arizona State University. However, from our experience, it s more of an issue online than it is on the street.
Bring your ticket vendor s customerservice number with you to the event. If there s a problem say, someone sitting in in your seat you ll have a better chance at resolving the problem right then and there.