Ticketmaster's Verified Fan program has enjoyed an estimated 90 percent success rate blocking tickets from being purchased by bots and brokers while getting the good seats into the hands of fans, Live Nation CEO Michael Rapino said. Since launching earlier this year, Verified Fan has helped block bot purchases so the company can better focus on meeting actual fan demand.
"The challenge is we don't have a mile-wide front row -- the old problem in the business is supply and demand," he explained on the KindredCast podcasthosted by LionTree CEO's Areyeh Bourkoff. LionTree is a New York-based financial institution.
Over 10 million people tried to buy tickets to see Adele's 2016 tour, but because of venue size only 400,000 tickets were available.
"There's no nice way to tell 9.6 million people you can't go," to the Adele concert, he said. The company has also had to face over-whelming demand for Bruce Springsteen's upcoming Broadway run as well as a highly anticipated Taylor Swift tour, who is encouraging fans to buy her merchandise to "boost" their place in line and their shot at buying tickets.
"The challenge though is being more transparent. We start having a better dialogue. So you [the consumer] will feel better if you've registered and we tell you, you're one of 100,000 that are registered. We have 50,000 tickets here. And here's how you can now increase your spot in the line."
The interview comes as Live Nation's stock has reached the $40 per share mark, a record price for the 12-year-old company that started 2017 at $27.50 a share and seen it rise 47 percent to reach a market cap of nearly $7.7 billion.
"There's probably not been an industry with compounded growth as consistent as the live music business," Rapino said of the company's success, explaining that "live concerts continually ranked in the top three things that a consumer wants to attend every year as their escape."
Part of the growth has been fueled by Live Nation's global expansion Rapino explained, saying, unlike other industries, there are fewer barriers to entry in the live entertainment sector.
"I don't need a factory in Columbia. I don't need a media broadcast license. I have no limitations. We can open up a Live Nation office in Columbia tomorrow. And the product that's exported there is Rihanna," says Rapino, who explained that his own international outlook came from the time he spent in London working with Clear Channel.
"The greatest kind of gift I had was seeing the world through a much more global lens," explains the native Canadian who grew up in Ontario's Thunder Bay. "So when I came to L.A. and launched Live Nation out of Clear Channel in 2005, I just started with this idea that this is a global story. This isn't a U.S. story. It's really about a global business consolidating and doubling down on this strategy over and over."
He estimates in 2017, 80 million fans will attend a Live Nation concert, event or festival. He said Asia and Latin America represented the biggest growth potential and that the company could eventually reach 200 million customers on a global basis and potentially increase average consumer spending on merch, food, alcohol and other categories by $2 a fan each year over the next decade.
"We're only about a 30 percent global market share," Rapino says. "So we have a lot of growth left ahead of us."
You can hear the entire podcast here.
