Posts Tagged ‘ARAMARK’

LESSONS FROM ANDY GROVE

June 23, 2009

It has been so long since I wrote the last newsletter, I wasn’t sure how to get started (very sorry).  Then it dawned on me that I had just gone through what Andy Grove, former head of Intel would call a “10x change”.  Ok, so this is old news.  Andrew Grove’s book, Only The Paranoid Servive came out a long time ago.  But the lessons in the book are sill relevant…if not more relevant then when first written.  Certainly for me. 

READER’S WARNING:  Today’s LiveWorks Newsletter is much longer than normal.  If you aren’t in the mood for a story that will make you laugh, cry, and want to strangle me, please stop reading now!!!!

THE SEVEN P’S

In certain branchs of the military you will hear about the 7 P’s.  They are Prior, Proper, Planning, Prevents, Pathetically, Poor, Performance.  Anyone who has every visited my office has seen them framed on the wall.  Good production and event managers know that “it is all in the advance”.  Yet after months of planning (I thought), hiring a “gunslinger crew”, and having a list and checking it…three times (a great tour manager once taught me to do everything 3-times), somehow I still managed to fail our guests at The Great American Food & Music Fest.  So what went wrong?

GOOD NEWS FIRST

All my friends (and probably those I’m not so friendly with too) had been really sick of hearing about The American Food & Music Revival (the show’s name prior to taking on partners, etc).  Planning a package tour and counting on talent each year has been getting more and more difficult unless you have a solid product like Kevin Lyman / CAA’s  Warped Tour.  I was looking to develop something that appealed to a wide audience (no pun intended)…could be seen as a party to kickoff summer…was family friendly…and didn’t need to have one or two “headliners” to make the shows fly.  Years of research and planning went into this idea.  It actually started out as “Bobby Flay’s Ultimate BBQ” the first time I pitched it to the “Content Group” at what was then Clear Channel Entertainment. 

It wasn’t the first time I has spoken to the group about a Food Show.  I had been pow-wowing with Don Muller since his Artist Direct days about the concept of bringing an “Aspen Food & Wine Classic type event to America”.  When I went to work for CAA, Don and Brian Greenbaum picked-up the concept again.  We just never got it off the ground…but we will.  Anyway, when I went to management with the upscale food concept at Clear Channel… they didn’t get it.  CCE couldn’t understand what separated our idea from all the other food and wine festivals, shows, auctions, etc, that exist already in every market in the country.  But “Bobby’s Show” was different, it had star power (Flay was just really hitting the public’s radar at this point), a little music, and food from around the country.  Well I pitch the concept in the meeting.  Immediately, legendary concert promoter Ron Delsener stands-up, takes a wad of cash from his pocket,  throws it on the table and says; “Here Lewi, I’ll pay for your show to play Jones Beach if you just shut the fuck-up about food shows.  We have all heard enough”.  I laughed so hard, I think snot went sailing across the room. 

June 13th, 2009 we finally tested the concept of celebrity chefs, the best of “All-American Food”, and American music…all in one place at one low price.  We built it and they came…and came…and came.  Ooops.  That’s the good news.  The worst case scenario didn’t happen.  We sold a bunch of tickets.  We just didn’t realize how many would sell in the last few days leading into the show (we were already loading-in with food on the way from around the country)…and the walk-up…in 2009!!!! 

DOOMED @ DOORS

Have you ever produced a 10-hour festival where everyone shows-up right at doors?  Well I have now.  As is my tradition, I was up at the front gates for our Noon door time.  To my shock, I saw a line like I’ve never witnessed in my life.  Guests compared it to amusement park lines, but it was actually worse!  I called on the radio to our team and told them they better come and help.  On the show we had 2 production managers w/ 2 assistants, a site coordinator, a F&B Director w/ 2 assistants + 2 zone managers, 2 people for the wine tents, a shipping and receiving manager, a VIP/Guest Relations person (that I never even met), a talent department of 5 (and we flew-in a new director the night before the show)…well you get the point.  I was thinking we had our bases covered.  Somehow we didn’t.  We also got caught-up in technology.

We wanted to keep lines down.  It is something that we had talked about on every call and in every meeting.  “Cashless” seemed like the way to go.  Through research, we found only one company that we thought could handle the job.  They made these really cool looking wristbands.  All guests would have to do is put a credit card, debit card or cash down and away they went.  Their transaction could be made in 3-seconds or less just by scanning the guest’s wrist.  For our VIP guests who had already purchased “all you can eat”.  Their wristbands would already be loaded.  I’ll save you most of the details but just as we are about to open the doors there are signs of trouble…”the screens in the stage right plaza are plank” came across the radio.  We hold doors another 15-minutes.  It feels like 50.  Families are just standing there. 

Problem solved (or so I think),  we open the doors.  Tim Anderson the GM of Shoreline Amphitheatre and I notice the next issue.   The wristbands are creating another unforeseen problem…it takes longer to get each guest through the front gates.  The ticket taker has to take the ticket, read it, grab the appropriate wristband from a box and put it on the guest.  This only adds to lines,  and people just keep coming… but there is really no where to put them.  Aaron Hawkins (Shoreline’s ops guy), Tim, and I decide the best course of action is to ditch the VIP entrances and open all the gates to all guests.  We need to get people in.  Ok, the lines start to move…blood pressure going down…but then the radio starts going off like we just got ambushed by the Taliban.  “Cashless system is totally down on my computer.”  “It is reading the wrong prices at all the Aramark bars.”  “All the Serious Eats and All Access tickets are reading over limit when they go to get food.  They don’t have a limit, someone please come help me.”  We had heard enough, the cashless system would have to go. 

There were originally three plans for our cashless system.  Plan A was simple.  Use the building’s Wi-Fi and broadband connection to run it.  Well, I’m a safe sex kind of guy so I wanted a back-up in case that failed.  Aiport Cards became the solution.  If we purchased one for every computer at the venue, we would be fine.  If both plans A & B failed, we would then go to a cash system.  Therefore banks were to be distributed to all cashiers prior to the show.  Great plan…in theory. 

When the engineers from the tech company came to upload their software on to the laptops we rented for them, the laptops would no longer get on the Internet.  Without the software, no problem.  With it, couldn’t find a signal.  Between our camp and theirs, they figured out a solution.  There was only one problem.  By doing what they did, they disabled our ability to use Plan B, the airport cards…leaving us only with a Plan A & C.  So the system failed… we called a 911 meeting of everyone from our team, Shoreline, Live Nation, and Aramark to put the cash system into effect.  This is when I found out we were 10 banks short.  WTF!!!!

Each ticket included at least one free plate of food with your admission.  It was supposed to be programmed on the guest’s wristband.  We had no way of knowing who had used theirs and who hadn’t.  We would have to go with the rolls of paper tickets we had purchased for this exact purpose (guests would use it for their free plate of food) and just give one to everyone.  Those that had the “all you can eat” status would stick with wristbands, just not electronic ones.  As we met to put the final touches on our plan, I heard the money people talking about being 10 banks short of what we needed.  How could this be?  We had this plan in place for days…we had a cash delivery…what is the problem???  Well our business manager jumped in and fixed the problem by making each bank a little lighter…and away we went to change over the system. 

LIVE NATION TO THE RESCUE

Live Nation has taken their lumps over the years, but if you could have seen Tim Anderson, Rick Mueller, Lee Smith, Jodi Goodman, Creighton Burke and their team in action a little over a week ago, you would have shit your pants.  Never have I seen promoters put such effort into trying to fix problems not created by them.  Rick Mueller actually jumped up on a stand and starting yelling directions so guests could hear him.  All were handing out meal tickets, answering questions, and unfortunately, sending those already unhappy to the box office for a refund.  We gave 1900 just on the day of show.  I can’t thank the Shoreline and Live Nation staff enough for their hard work and efforts on our behalf.  I’m sorry that if ever came to that. 

THE HITS JUST KEEP ON COMING

Once we switched over to cash, we all thought that our purveyors would get caught-up and between the food and talent, we would win the crowd over.  But chaos had already in-sued and we were doing a horrible job of getting things under control.  I went back to the production trailers, got into my car, drove to the back of the parking lot and startedto deal with stuff via radio and cell.  The thought was, if I got away from the excitement, I could do a better job of thinking through issues and stay calm doing it.  That lasted maybe 15-minutes.  I got called to the front gates again.  It seems we were getting hit hard with guests wanting refunds due to the lines.  At the same time, guests without tickets were still streaming down the hill by the thousands.  When they would realize that the lines at the box office were not for purchasing but rather for refunds, they would turn around and head home.  This created more problems…and traffic.  The CHP told me it was the worst they have seen at Shoreline (great, I’m so proud).  We would have to open up more windows to take care of refunds…and the Shoreline staff was really taking abuse.  I would need to stay and help.  Dealing with the public is not something I do very often.  Most think I’m a little “rough around the edges” for customer service.  But here I was out in front, giving it my best.  In just a few hours, I was punched (jaw is still sore), spit on twice, cried on 3-times, and …wait for it..and old lady shook her cane at me.  As the Beatles once said, “The love you take, is equal to the love you make”.  Or something like that.  I wasn’t making or taking any love from this gig. 

WHEN WILL IT END

From the moment we cracked the doors till the show was over, the radios were going off constantly.  First we ran out of Cheesecake at Junior’s (imagine angry homesick New Yorkers), then Graeter’s Ice Cream (not only the best ice cream in the country, but great people too), then I kept hearing that we were running out of Pastrami at Katz’sDeli (again with the New Yorkers).  Then they would have more.  Then they would be out again.  It wasn’t till after the show that I found out that it was a cooking issue.  They had to cook the Pastrami first and didn’t have enough space or equipment to do an adequate job.  COOK PASTRAMI!!!!  Why wasn’t this stuff prepped prior to the show.  Why are they cooking and not serving for 45-minutes at a time?  Ok, now we are out of homemade smores.   Then I get called to main stage.  Seems there’s a problem with the SF Weekly’s Burger Challenge.

The SF Weekly was one of our three media partners that all did an amazing job for us (special thanks to my girlfriends at KGO radio).  The Weekly’s “Best Of” issue came out a few weeks prior to our show.  Their Best Burger falls into several catagories.  We would have our celebrity chefs, along with the Weekly’s publisher (who is a foodie) and a local restaurateur judge the competition for the “Best Overall Burger in the Bay Area”.  Anyway, I ran down to the stage to find out that on of our talent can’t judge the burger challenge. SHIT!  No problem, here is Anne Burrell from the Food Network to replace our downed judge.  Away we go…NOT.  Where is the emcee???  He is cooking with one of the chefs on another stage???  SHIT!!!  Ok, stage manager (his name is Kent, but you dont’ know him so I’m calling him stage manager) please give me the rules of the compition.  I’m your guy (Later when answering emails, one guest suggested that the jackass hosting the burger challenge should not be asked back.  I replied that it was me…he would have to be asked back, but knew his place was behind the stage, not on it.).

FINALLY

The show ended at 10:15 pm.  With all the chaos, our production team managed to keep 5-stages running on schedule.  Problem is, very few saw the show since they were all waiting in line trying to get something to eat.  The show wasn’t even over and my Blackberry started vibrating.  My email is connected to the info email address on the Fest website and angry guests were already writing in.  Here goes the blood pressure.  I would need to get home as soon as possible and start dealing with customer service.  Live Nation, Shoreline and our team were all on the same page….give anyone who asked a refund. 

I got back to the hotel from load-out in the early hours of Sunday morning but of course couldn’t sleep.  In less than 24-hours I has caused a lot of destruction.  Not real destruction like an earthquake, but there was a lack of organization and professionalism missing at one of my shows.  Anyone who knows me, knows what this kind of stuff does to my brain.  So I jumped in the shower, packed my stuff and headed home.  The drive seem to take forever from Palo Alto where we were staying to Woodland Hills where I live.  I just couldn’t stop looking down at my Blackberry.  By the time I reached my house, there were already hundreds of emails to respond to.

MY 10X CHANGE

All told, I have received close to 2000 emails now from the Fest.  This was my dream turned nightmare.  Most of those emails were not fun to read.  But it was important to read every word… and respond to each guest personally.  Not with a form letter, but with a note that talks about their specific issues or questions.  I asked KGO – the talk station which is number 1 in the market if I could go on the air to make an apology.  I’ve sent out ice cream, cheesecake, gift baskets, apologizes, and t-shirts to guests for spoiling their graduations, birthdays and anniversaries.  I had no choice but to do interviews…7 in fact (I didn’t do one prior to the show playing and normally don’t ever), just to have them blast me.  My name has been emailed and posted everywhere.  This has never happened.  It is a new age.  An age of communication. 

I’m always preaching customer service in the Liveworks Newsletter.  Normally I hire people on our cruises, etc, to do those jobs.  This time it was me.  The Internet has changed the way we do business.  Whether we like it or not, our names are now our brands.  My brand was being tarnished and I needed to step-in and do something about it.  I had to make it right with each and every guest that wasn’t happy.  I’m now in the customer service business and people know my name.  It isn’t something I wanted to have happen, but it did and my business is forever changed because of it.

HAPPY ENDING

The happy ending for The Great American Food & Music Fest is the tour that is being routed from May through early July (weekends only) 2010.  We proved that there is an audience for this show and promoters and sponsors are already calling.  All we need to do is fix our logistical issues…which is just a numbers game.  You look at it in two ways.  First a formula of one POS (point of sale) for every thousand people.  The other, look at each purveyor and see how many guests they can serve in an hour.  Have enough of them and we are covered.  We also need to get our local expenses down.  Although Live Nation made money… even after giving back nearly half the gross in refunds, they should have made more (yes I just put that in writing).  Once we have a touring unit (actually two), costs should be cut by at least half. 

The above story is true…and embarrassing.  How could someone who has been in this business for over 20-years…plus grew-up with parents who are also event producers…fuck-up something so bad?  Well, I’m still trying to figure that out myself.  Hopefully a few more “post mortem” meetings and something like this will never happen again.  Regardless, my business (and yours) is changed for good.  Make sure you are communicating with our customers.  If we had done a better job, I might have some money in my pocket right now. 

Speak with you soon…

Jim

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“IF I WERE…MICHAEL RAPINO

December 1, 2008

You can call me a sucker.  I bought Live Nation stock when it was at $20.  Friday it was trading at $4.89.  So why when Live Nation CEO, Michael Rapino had just announced that the company’s third quarter numbers were up significantly over 2007 would the stock price actually slip?  If you were to take out the sale of Live Nation’s motor sports division to Feld Entertainment, they were still up.  So why did the stock fall, and what can our friend Michael do to restore confidence on Wall Street?

In talking to friends who have also looked at the numbers, Wall Street just doesn’t seem to believe in Live Nation’s business model as it currently stands.  Their margins are just too small for analysts, investors, and if you own your own business, probably you too.  When Michael Rapino first took over as CEO of Live Nation, he spoke in public about the consumer’s “value proposition”.  Michael told us at conferences about his plans to make the “amphitheater experience” better.  He talked about food selection, price, the potential of taking out ARAMARK, etc.  Then what happened?  The realities of running a public company, quarterly numbers, and the like must have set-in.   That customer experience stuff was not heard about again.  Instead Live Nation’s message shifted to branding (Live Nation, Artist Nation, Fan Nation, House of Blues, Fillmore, etc), an international platform for brands to reach consumers (e.g. the Citi deal), and deals with Madonna, U2, and of course Carrot Top (just seeing if you were paying attention).  Brands, bands, and fans you might say.  Problem is the fans are last in this equation.  Now you add the Ticketmaster Entertainment scenario in there just for shits and giggles and it really becomes a migraine for Michael.

We will stay away from the Ticketmaster in this letter and just focus on Live Nation and Michael.  Starting with Jack Welch?  Well, Jack may be a business leader from the past, but his brave steps to form GE Capital and move General Electric away from less profitable businesses the company was known for such as small appliances (toasters, can openers, etc) make for a good example of what Michael and company need to do.  Live Nation needs to show Wall Street a plan and a leader that will get the company to the goal line.  So without further B.S., here are some of the things I would do…”If I were Michael Rapino”

·     HIRE SOMEONE FROM DISNEY PARKS TO RUN VENUE OPS – There needs to be a complete overhaul of everything (employee training, venue maintenance, F&B, VIP programs, ticketing, parking, security, transportation, etc).

·     BRING IN A CMO FROM A FORTUNE 500 COMPANY – Certainly Live Nation has its share of marketing pros to count on (Jim’s from the East, Brad in the West, Lulu in Texas, etc), but what our business needs is are marketers that are used to dealing with big ad agencies, big brands, big budgets, and have worked for publicly traded companies.

·     HIRE A CUSTOMER SERVICE CZAR – Disney, Ritz Carlton, Nordstrom, and other customer service culture oriented companies are great places to look.  Live Nation should stand for customer service.

·     TICKETING, OK I’M BREAKING MY PROMISE – Live Nation’s new ticketing system should bring them greater revenues from ticketing… in theory.  But with Ticketmaster Entertainment now owning a management company that supplies so much talent to Live Nation venues, Live Nation’s ticketing is looking much more complicated.  As stated in earlier LiveWorks Newsletters, Irving Azoff is an artist manager first and foremost.  So as an example, both Irving and his partner Howard Kaufman know that their client Jimmy Buffett is probably better suited to play outdoors.  The company Irving now runs makes out better (at first look anyway) if Buffett plays indoors.  Will Buffett play the amphitheaters next summer?  If he does, where do you think all the extra ticketing money Live Nation might be making on their new deal will be going???  Do you think ticket surcharges are going to go down?  Is it too late to talk to Irving about getting Barry Diller to buy LN out of their ticketing commitment???  Just asking.

·     MARKET THE EXPERIENCE – Maybe I sound like a broken record, but in this case LN has something special.  I believe strongly in the amphitheater experience… at least the old one.  Yes, for acts that carry huge productions, they may not be the best places to play.  But for the fan experience, when done right, there is noting like seeing a concert outdoors.  Just ask a Buffett, Dave Matthews, Grateful Dead, Tom Petty, James Taylor, Warped Tour, or any other artists’ fan that has frequented the “sheds” over the years.  Same can be said for many Live Nation clubs.  Have your newly hired CMO come up with some kick-ass marketing that reminds fans how much fun it is to be at a concert with your friends, family, etc.  It brings people together.  Gives them something to share.  That’s why fans buy the event shirt.  So they can show all their friends they were there.

·     FORBID PAPERING – Papering a show (giving away free tickets for gig that doesn’t sell) or selling-off lawn tickets for $10 after the show goes on-sale should not be allowed at any Live Nation show.  As Gene Simmons put it in his Keynote at the Billboard Touring Conference, “it is like letting the fox into the hen house” (can’t believe I just quoted Gene).   Fans find out about these things real fast, and the ones that paid full-price this time will wait for the free tickets or the fire sale the next time the act is through.

·     HIRE A CHIEF TECH OFFICER – This isn’t an IT guy.  This is someone like Joe Rospars.  Joe ran the tech side of Obama’s campaign, while the company he founded with his partners, Blue State Digital was responsible for the online fundraising.  Live Nation needs someone that can speak to music fans and figure out a way get those fans to help make new ones.  Fact is, in 2003 when Ann Marie Wilkins called me to contribute to Obama’s Senate run in Illinois, I had never heard of him.  He is now President Elect of the United States.  In early 2007, most Americans still hadn’t heard of our new President.  Guys like Joe can do a lot for our business.

·     BUY METROPOLITAN AND JAM – I know they certainly don’t want to sell to you and you may not want to buy them, but John, Jerry and Arny are all legends in our business with great relationships your people don’t necessarily have.  Do you really need one more competitor in markets that has seen nothing but turbulence?  Imagine the artists you could potentially promote in NY and Chicago with those guys on your side.  This seems like a no brainer to me…other than getting them to do it.

·     GO ON A ROAD SHOW – All of the above cost money and in the short term, earnings will suffer.  This could be hard for investors and analysts alike to swallow but you must remain strong.  Put a plan into place and then go out on the road and sell it to your entire staff, local “town hall meetings” and finally, Wall Street.  But don’t just go to NY.  Speak with analysts, traders, and business leaders in every community you do business in.  Let consumers see a face to Live Nation.

·     PRICES – We all know that on top of tickets, the prices for concessions, parking and merchandise are just too high.  With that said, it is funny that an act will make a comment on stage about the price of a beer, popcorn, or parking at a Live Nation venue but won’t say a word about those same prices (or even higher) in the arena.  Why is this?  In many cases, the fans feel ripped-off, and the bands feel they are being ripped-off.  This is a huge perception problem.  The answer is probably going to have to be a combination of dropping your prices to increase volume and positive PR in the short term.  Long range, we need to work on the “value proposition” because for whatever reason, our fans seem to have a problem with the $8 parking at your venue while football fans pay at least twice that and don’t seem to complain.

We have probably covered enough.  Again, my disclaimer is that I’m a Monday morning quarterback.  I don’t have to sit in Michael’s shoes everyday.  But I do feel that Jack Welch’s example is a good one here.  If you are really in this for the long term Michael, some of what is written above just might make sense to you.  To bring the live business back to health we need to think less about gross and more about number of tickets sold.  In the long run, getting more fans through the doors to experience live entertainment is the only way to win.  The concept of fewer bodies at a higher ticket price can only work for some acts and for so long.

Talk with you soon…

Jim