Posts Tagged ‘transportation’

“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

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Top 10 Ways to Make Your Festival Successful

November 27, 2008

Last week I had the honor of moderating the “Festival Panel” at the Billboard Touring Conference in New York.  I hadn’t really wanted to do these type of things since starting the Aspen Live Conference (Dec. 11-13 @ St. Regis, Aspen http://www.aspenlive.net), but when Ray from Billboard emailed me the list of panelist, it was an easy yes.  After all, we are talking about the best and most successful music festival producers in North America.

The panel; Chris Shields from Festival Productions (New Orleans Jazz and Heritage Festival, Newport Folk Festival, Playboy Jazz Festival, etc),  Charlie Jones from C3 Presents (Austin City Limits Festival, Lollapalooza, etc), Tony Conway from Buddy Lee Attractions (CMA Festival, Nashville…formerly Fan Fair), Chuck Morris from AEG-Live, Rocky Mountains (Mile High Festival, Rothbury), and Ashley Capps of AC Entertainment (Bonnaroo, Vagoose) really are the best at what they do.  Our Canadian representative got sick and was unable to…well represent.  The basic question that we were dealing with was the health of the festival business in North America.  Is there room to grow?  Are there enough headliners to go around and still have each festival keep its identity?  The easy answer to all is yes.

Tony Conway pointed out that the CMA Festival actually raised their ticket prices this year and are at this point well ahead of last year’s sales to date, without announcing a line-up (the event takes place in the spring).  On a call prior to our panel, Charlie Jones talked about how the Austin City Limits audience “must be trained or something”.  The fact is they are…trained to expect that the event will be well run, with great music and food, clean port-a-johns, plenty of places to get a bottle of water that doesn’t cost $4, amazing transportation system, and a friendly staff.  The ACL and CMA audiences are trained to expect quality and value.

Based on my notes from our panel, here is what the experts had to say…at least on that day is the TOP 10 THINGS YOU CAN DO TO MAKE YOUR FESTIVAL SUCCESSFUL!!!

1)      Know Your Market There is so much that goes into a festival’s workings, that without knowing about traffic patterns, neighbors, law enforcement, political issues, competition, and a whole host of other issues, you are setting your festival up to fail.  Chuck Morris pointed out that artists that aren’t big around the country can draw in Colorado.  One reason being radio station KBCO in Boulder.

2)     Community Relations – Each of our panelists at the Billboard Touring Conference had at least one story of how building relationships with community and business leaders, neighborhood associations, law enforcement, fire and rescue, parks & recreation officials, health department, and others gave them some kind of advantage.  Whether it was bidding on a new project, going into a new city, or getting into trouble and needing help, there is no substitute for being a good citizen.

3)     Over Deliver – Especially in year one, it is important to over deliver for your consumers and talent.  Even if it means the difference between breaking even and losing money, spend the extra to WOW the audience.  It keeps them coming back…”trains them”.

4)     Price – Price is very much tied to knowing your market, but for some reason, festival pricing is much more sensitive than regular live entertainment pricing.  Your customers really want to feel they are getting their money’s worth since there is an assumption that what ever they are going to see will be watered down (music act will play a shorter set without their production, food festivals will give you smaller portions than the restaurant would, etc).

5)     Transportation & Housing – This really should be 2 if not 4 separate departments of your festival team.  Certainly if you going to have 2 departments you need to separate responsibilities between those that handle transportation or housing for artists and crew and those that will get the audience from place to place.  Housing is a place not to be overlooked.  Every try to get a hotel in a city where there is a large festival?  Good luck!

6)     Booking Talent – The strong message here is that anyone can book a really big headliner; it is the whole package that makes a festival. Remember, a festival is more than a line-up it is about passion.

7)     Camping vs. “City” Festivals – Our panel all believed that the growth in North America would be more in the non-camping festival model (ACL, Jazz Fest, CMA Fest, etc).  With that said, Rothbury only started-up last year in Michigan and it is a camping festival.

8)     Food & Beverage – Every producer will tell you about the part that food and beverage play in the overall feel of your festival.  With festivals like New Orleans Jazz & Heritage and Austin City Limits, the food has become almost as much of a draw as the music.  Also price was a big topic.  Some people just have a problem with $4.50 for water.

9)     Technology Is Your Friend – Use technology whenever and wherever possible to make your fan’s experience more enjoyable.  Things like an event schedule that consumers can customize to plan their day at your festival have become necessity.

10)  Build a Model – All of our panel’s festival producers pointed out that once you had a model that worked, you could reproduce that model in other cities and with other festivals.  The key here is experience.

If there was an 11, it would have to be staying out of trying to do a festival if you have no experience.  Better to partner with someone like those listed above who already have their “models”, and can make things run smoothly for you.  Going in head first without learning to swim can make all of us drown.

Talk to you soon,

Jim

Lessons From Disney

November 15, 2008

We all know that The Walt Disney Company has a lot of money to do things right. Yet many of their competitors are well capitalized and can’t even deal with trash properly (are you listening Mr. Shapiro).

My 11-year old daughter and I walked out of Disneyland / California Adventure after spending $290.89 ($12 for Parking + $188 for 2 “Park Hopper Tickets” + $63.89 for dinner @ Restaurant in Pirates Ride + $27 for water, pretzels, soda, etc) with big smiles on our faces. Why can Disney charge so much and still leave consumers feeling they got value for their money (ok, we went a little crazy eating at that restaurant, but you only live once and we actually were able to get in)? Here are some major points from the notes Gwen and I took this weekend. We will stick to stuff that everyone can afford to do in some way.

· WEBSITE – From Disney’s website we were able to buy tickets, plan our day, find out what rides were closed, what shows were new and when they were playing, and of course directions to the park.

· WELL MARKETED ROUTE – We all don’t have the political clout to get the kind of exits and signage that Disneyland has, but it doesn’t mean you can’t have a well market route. Bonnaroo and ACL Festivals both do a good job with this.

· TRAINED PARKING STAFF – These people know how to park cars, campers, buses, limos, and even pumpkin coaches. If you can’t afford to hire pros to run your parking, study what Disney does and then create a manual.

· TRANSPORTATION FROM YOUR CAR OR HOTEL – At many arenas, stadiums, amphitheaters, etc, there is one hell of a hike from your car to the entrance to the facility. Disney not only provides transportation, they give you valuable information while you are traveling on their trams and monorails.

· EXTREMELY WELL TRAINED STAFF – If you need a map, “go to a custodial worker in an all white uniform”. Want to find a ride or attraction and don’t want to look at the map?  ANY employee can tell you the fastest way to get there. And with a smile on their face. Training and manuals are the keys to success…along with hiring the right people (but not as important as training and manuals no mater what anyone tells you).

· BRANDED LIVE ENTERTAINMENT – Disneyland and California Adventure sponsor/partners are built right into the show rather than looking like an afterthought. Everyone who drives a car on the “Autopia” ride gets an official drivers license from Chevron. Kodak has “Photo Shot” areas that are even marked out on the theme park’s maps.

· SIGNAGE & MAPS – Maybe repeating myself a little with well marked route, but this relates to ounce the consumer is at your event. If you have trouble finding something at a Disney park, you either can’t read or speak English or Spanish, or you don’t know to take advantage of their translation programs… or you don’t like asking for directions period.

· PLACES FOR PEOPLE TO SIT & EAT – You will sell more food and beverage if you give your guests a place to enjoy it…out of the sun, rain, wind… on a clean table. Disney knows this.

· FOOD & BEVERAGE VARIETY –Disney even goes the extra step of using the theme of the area (Adventureland, Frontierland, New Orleans Square, etc) to design both the menus and architecture of their restaurants, stands, carts, etc.

· LINES ARE BAD – When lines start to form at the ticketing windows out front, they open more windows right away. If one line seems to be moving faster than another, there is a supervisor out in the slower line trying to find out why (clipboard in hand). When there are lines at popular rides, Disney warns you of the wait time, gives you an option to come back later with a “Fast Pass”, and tries to keep your mind occupied by designing an experience around the line should you decide to wait.

· PEOPLE TRAFFIC CONTROL – Boy do these guys know how to keep guests moving, change directions for parades and shows, etc. Training, training, training.

· CLEAN RESTROOMS / CLEAN EVERYTHING – Nothing else to say.

· KEEPING STUFF UP – It is amazing, but it is said that some things at Disney parks get a fresh coat of paint every night. Ever see how much “ABC gum” you find at a Six Flags Park? Yuk!!!

· LIGHTING MAKES THE SHOW – Whether day or night, Disney parks use lighting to help create an atmosphere. You should do the same.

· CROSS PROMOTION – Disney builds their movies, books, and TV shows into their theme park rides, shows, and attractions. Branding at its best.

I could go on forever, but the list above was most of our note highlights. Disney is certainly not perfect, but we can learn a lot from them.

As always, would love your opinions and comments.

Talk to you soon…

Jim

Hospitality is a Profession, so Leave it to Pros

November 9, 2008

I was talking with a friend on Friday who told me they wanted to start a conference.  I’m not going to say much more than that since I don’t want to give away my friend’s idea.  Anyway, it became apparent that my friend didn’t know much about the hospitality, event, or conference businesses. This friend could be in touble if they move forward without getting help.

 

On Saturday I got an email from my assitant while I worked at CAA, Nicole Provencio.  She’s now at Sketchers Corporate (the shoe company) where her “main job is to book hotels for all trade shows, conferences, and events.  Finding the newest & hottest hotels, getting the best rates, avoiding attrition, etc.”  Sketchers have over 20 annual trade shows alone each year, so they need someone like Nicole…someone with experience.  Sketchers, just like you, must have an experienced person on the other end of the phone or across the table from the hotel, resort, conference center, cruise ship, tour operator, or whoever you are doing business withs’ sales person.  They are certainly experienced and know just what they can and can’t offer.

 

 

 

When Andy Levine from Sixthman told me that there was a difference between doing a big concert or festival and producing a music themed cruise, my ego got the best of me to be honest.  I thought, if I could handle concerts with 200,000 people or manage tours checking 175 people in and out of hotels, tour buses, limos, vans, town cars and airports around the world, I could handle a few thousand drunken music fans and bands on a cruise ship.  I got spanked.  I’m sure Andy laughed.  Nothing takes the place of experience. 

 

 

So you don’t have the money to hire a pro to take care of your hospitality.  Here are some helpful hints from a guy with a few years on the road.  Some are obvious, but always worth being reminded.

 

 

 

·     In this economy disposable income is declining which means fewer will travel.  It is a buyers market.

·     When dealing with group sales at hotels, try to speak with someone as far up the food-chain as possible since anything out of the ordinary you may request will have to be run up the ladder anyway.

·     Try to avoid contracts whenever possible.

·     When booking groups, most hotels will insist on a contract.  The first things you need to look at are dates and numbers.  The word ATTRITION will become very important if you are managing your room blocks.  Try and get dates in your contracts where you are able to drop inventory you were not able to fill.  Obviously the closer to your event dates, the better for you. 

·     Before you start negotiating room rates, get an understanding of the hotels “rack rates” and the region’s high, low, and shoulder seasons.  Good deals can always be had…even in “high season” for a property. 

·     Deposits are another place you can push properties now.  They should be looking at this as more of a partnership these days as you are taking real risk to produce and market the event or whatever you are doing.  You should make your deposits as close to your event date as possible. 

·     Other mines to look for in hotel and hospitality contracts include: Buy-out rates and fees (rates go up on rooms for taking an entire property, resort, cruise ship, etc…this is a common practice at some resorts and cruise lines), baggage handling fees, gratuities, taxes on gratuities, ballroom and conference room charges, phone and data lines, hospitality desks, room drops (having materials or gifts delivered to guest’s rooms), copying and business center charges, and lets not forget parking (I went to a conference once where guests paid $50 per day to park their cars and it wasn’t in New York).

·     Food & Beverage becomes a whole new world and language in hospitality and you won’t believe the prices.  In this case, those airplane crash drills where you put your head between your legs and pray may work best. 

·     Not booking groups but want to save money on travel?  Look at the “Limited Service Hotels” popping up everywhere. 

 

Reality is hospitality is a profession and it pays to hire someone experienced to handle your needs.  Musical artists, their managers and agents go to producers like Andy Levine to do their cruises because he has seen it all.  Sketchers knows to go to Nicole because she booked Aspen Live Conference (Dec. 11-13 @ St. Regis, Aspen…Shameless plug) hotel rooms, transportation, meals, etc, for two years before coming to their company.  My advice, leave hospitality to Andy, Nicole or The Agency Group Events & Entertainment, Ltd. (another shameless plug).

 

As always, would love your comments and input.

 

 

 

Talk to you soon,

 

 

 

Jim

Make it Easy to Say Yes!

October 22, 2008

Making it easy for consumers to say yes to buying a ticket during down economic times (and good) comes down to always thinking of the audience first in that packaging process!!!  We must address fan’s concerns about ticket price, ticket surcharges, venues, seating (or no), access to good seats, parking, food and beverage choices and price, employee training, security, long lines (a true enemy for all), talent line-up, marketing, communications, transportation (especially for those underage), under 21-shows, and more.   If we do, we will be “recession proof”.  Everyone is looking for an escape right now. 

We have to start somewhere, so if the live business concentrates on ticket prices first instead of guarantees, we would be moving in right direction.  A ticket price in the “right room” will give you your gross potential that leads back to a guarantee.  And please don’t use that gross potential as an excuse to play rooms that are too big for your show.  Better to underplay the market and leave people wanting more than playing to a half empty room.

Bring the whole community into the process with you (talent, fan, venue, promoter, ticketing agency, media, sponsors, etc).  In sports before the start of a new season, many athletes will have “retreats” with their core team of sponsors, agents, managers, etc.  The idea is for everyone to be pulling in the same direction when the season starts. 

The Live Business needs to look at packaging all of our assets together to make it easy for fans to say yes.  We will certainly be having one of the “retreats” I mentioned above at the Aspen Live Conference December 11-13, but encourage all of you to find ways to get together on your own if you can’t make Aspen.

Talk to you soon…

Jim