Buildings are 'ultimate buyers' in agents' view.
From the booking agent's perspective, the more talent buyers in the game, the better-as long as they're good buyers who have a wealth of marketing tools and won't disappear if a date goes south. Given their databases, familiarity with the marketplace and customer knowledge, concert venues have extremely effective marketing clout, if they know how to use it. And they can't disappear.
"We partner and sell a lot of dates to venues direct," says Rob Beckham, William Morris Endeavor agent for such acts as Rascal Flatts and Brad Paisley. "To get shows, they're doing whatever they can to have content."
Talent buying is common in the smaller venues like clubs up to performing arts centers, and has been for years. In the big leagues, at the arena level, the risk is much higher, and buildings can potentially lose hundreds of thousands of dollars by having skin in the game. But at least they're in the game.
"When we go out, in many cases we talk to everybody, including the venue," says Dennis Arfa, president of Artist Entertainment Group, agency for such acts as Billy Joel, Metallica, Rod Stewart and Rush. "There are more venues with skin in the game, because having skin in the game gives them their best chance of obtaining dates."
A milestone in arena talent buying came in the winter of 2005 with Motley Crue's Carnival of Sins tour. That was the year when arenas "made their bones" as savvy talent buyers. Promoters basically didn't believe in the tour, at least at the asking price, and the buildings came to the table.
"That was one of the first tours where the promoters really didn't want to pay, and the buildings were willing to," Arfa says. "The tour did very well, then everybody paid. Everybody met the guarantee we were looking for once it did well, but it was the buildings that really came to the party. It was a breakthrough, because it was really a unanimous 'no' by the promoters."
Given their ancillary revenue streams like facility fees, ticket rebates, concessions, merch percentages and parking, arenas shouldn't expect any bargains from agents, who will take that revenue into consideration whether the buildings like it or not. "It's a different cost to run a show for [arenas] than it is a promoter that's just renting the building," Arfa says.
In that sense, the arenas are no different from promoter-owned amphitheaters, Arfa notes. "When you make an amphitheater deal, the break-even for the promoter is a lot different, based on all the ancillaries," he says. "What, that money doesn't count?" he quips. "'Oh, [they're] averaging $42 on the food and beverage and making a couple hundred thousand, but that doesn't count?'"
As for the perception that, in general, arenas get a shot at a date only when other promoters have passed, well, there's some truth to that.
"We always prefer to use promoters where possible," Beckham says. "If a promoter is either too busy or does not want a show, the venues still need content, whether it's a concert, circus or ice skating. The venues have a responsibility to keep the venue busy and keep the dark nights to a minimum."
Arfa agrees but says that dynamic is changing, and that arenas have to be aggressive particularly when promoters are aligned with competitive buildings. "They've had to get aggressive to secure talent, otherwise there is an abundance of dark nights," he says, adding that the arena-as-promoter concept is here to stay.
"They are the ultimate buyer," Arfa says. "The venue needs product-dark [dates are] a loss. If you're not taking risks, then all you are is a waiter, taking orders: 'Let me have a cheeseburger medium. Let me rent your building on Aug. 19.' In that situation, what are you offering? Nothing. Just a waiting service. 'Let me check my calendar.'"
Arfa adds that arenas are a welcome addition to the talent-buying pool. "We've been saying 'come on in' for a long time," he says. "They have the most to gain. What are you offering your season ticket-holders in July?"
And agents aren't the only ones asking the arenas to buy in. "Promoters go to the buildings and ask for help for protection: 'If I lose such and such, you pay,'" Arfa says. "The buildings are willing to do that. It's not like it's a 'versus.' In many cases it's cooperation. Sometimes the relationship is a happy union and sometimes it's an adversarial one. Basically, everybody tries to like everybody, but people have to do what's best for themselves."