Roberto De Luca, head of Live Nation Italy, believes that the only viable solution to tackling problems in the ticket resale market is dynamic pricing.
Dynamic pricing is a strategy in which businesses set flexible prices for products or service based on current market demands. While it is not a common practice in live entertainment ticketing, the approach is widely used in the travel, hotel and online retailing sectors.
Increasingly artists – including Taylor Swift – have implemented dynamic (or demand-based) pricing in an effort to tackle touts and the secondary market as a whole. The theory is that by matching supply with demand in the primaru ticket sale, prices are better-related to perceived value. In turn the potential margins on ticket resale are reduced.
“Just go to any secondary ticketing site and take a look at the names of the artists and the tickets that are sold,” De Luca told Italy’s La Stampa newspaper earlier this week.
“Nothing has changed and we cannot do anything. In addition, even if we could one day close these sites, do we then try to close Facebook where the people sell and sell tickets every day?”
Somewhat controversially, De Luca also suggested that fans were prepared to pay more for tickets.
“I have a distinct feeling that the official ticket cost is too low,” he told La Stampa. “If people continue undeterred to buy them on the secondary market, it implies that they have the money to do so.”
De Luca gave a personal example of how fans are critical of the resale market, but still choose to use it when they are desperate for tickets.
He added: “Yesterday an acquaintance of mine paid a crazy amount for an Italian artist that her daughter wanted to see at all costs. Then, with the ticket in hand, he called Live Nation to complain. There is confusion. Who is actually buying on the secondary market?”
The music industry executive concluded: “I think it is logical that the ticket could have a variable price, which can change over time. This could defeat the secondary market. The solution could be the ‘dynamically-priced’ ticket.”