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Music Glue chief says industrial touts are hindering new artists’ ability to build a fanbase

By | Published on Monday 23 November 2015

Mark Meharry

As the deadline arrived on Friday for submissions to the latest government review on secondary ticketing in the UK, the boss of direct-to-fan firm Music Glue, Mark Meharry, submitted his take, arguing that the boom in touts, who resell tickets to in-demand events online at highly marked up prices, is hindering the process that new artists, and their managers, employ to build profile and demand.

As previously reported, the government was obliged to instigate a new review of the secondary ticketing market by this year’s Consumer Rights Act, which introduced some light regulation of the resale sector, though without the key measures the anti-tout brigade would like to see made law: ie the compulsory publication on resale sites of each seller’s name and each ticket number, something that would make it much easier for promoters to cancel touted tickets, making customers much more wary of buying from secondary sellers.

Supporters of the secondary market usually present two arguments in favour of ticket touting. First, that over regulation will force the touts to websites outside the UK, where customers will not get the protections currently provided by sites operating under the UK jurisdiction, like Viagogo, StubHub and Ticketmaster’s Seatwave and Get Me In. And second, that if tickets sell on the secondary market for prices much higher than face value, then the artist and promoter put their tickets on sale at the wrong price.

That latter argument, says Meharry, misunderstands how artists build and analyse their live audiences, and by association the fanbases around which a direct-to-fan business can be built. And ignores the fact that fans have a finite amount of money to spend, and that the artist won’t want the fan to use up all their monies on one ticket. When they do so on the secondary market, the tout takes income that might otherwise be spent with the artist on merch or future tickets, which is particularly problematic for new artists operating on incredibly tight margins, and middle-level acts for whom live is their primary income stream.

In his submission, Meharry wrote: “The first rule of sustainable touring is ‘sell out, create future demand and return soon’. To ensure a sell-out and avoid market saturation, it is important to play in venues that are perhaps too small and with a ticket price that is perhaps too low. Today, when demand outstrips supply, tickets become available on the secondary market for inflated prices. Disappointed fans are presented with a choice: ‘wait until next time or pay a premium now’. Many choose the ‘pay now’ option and are effectively draining money from the artist, into the pockets of ticket touts”.

On the impact on new artists in the initial fanbase-building stage, Meharry adds: “In the modern, online, connected world, loyal fans are the new marketing department. The ‘super-fan’ is highly engaged and typically has a broad network of early adopters that thrive on the newest and coolest music. And they are usually not very rich. When tickets for their favourite artists go on sale and instantly shift to secondary sites, the super-fan is priced out of the market. They cannot attend and cannot spread the word to their network and the modern marketing mechanism breaks”.

He goes on: “Artists [also] rely on data from their fan networks to decide where to tour next; if a proportion of their ‘customer list’ is invalid because the email addresses provided came from [ticket-buying bots used by touts], this is undermined”.

Perhaps aware that the current government is not so keen on further regulating the secondary ticketing market – some MPs had pushed for stronger regulation in the Consumer Rights Act, but the government resisted – Meharry concluded by drawing parallels with other industries. He says: “If I built a ‘bot’ that bought EVERY train ticket for EVERY train leaving London on the 24th December and then sold those tickets for five times the price on secondary ticketing sites, I’m sure the House Of Commons would suddenly have a focused sense of clarity as to the core issues being debated here”.

Ultimately, says Meharry, it is consumers who lose out the most when artists are hindered in building their fan businesses, and in planning and pricing their gigs as they see fit, by the industrial level touting the online secondary market enables.

As we say, it seems unlikely that the current government will be keen to introduce further regulation of the touting market, and the operators of secondary sites will continue to argue any such extra regulation would be unworkable. But – for an issue that has been a big talking point at several points in the last ten years, only usually to fizzle out into nothing – this time a particularly high number of different people, companies and groups seem to have taken an interest. Though it still remains to be seen what comes of this latest review.

Listen to further discussion of the secondary ticketing market and the current government review on the latest CMU Podcast.