October 13, 2006, 12:00 AM

Online ticketing may be getting bigger and smaller at the same time

The handful of giant ticket brokers that sell event tickets were among the earliest adopters of e-commerce. But today, the Internet has enabled smaller players to grow and entrepreneurs to launch ticketing web sites of their own.

 

The handful of giant ticket brokers-companies like Ticketmaster-that sell tickets for music, theater and many other events were among the earliest adopters of e-commerce. For many in that industry, it wasn’t difficult to see how their product was a good fit for the online channel.

It didn’t take long for online ticket-selling to begin generating significant revenue. But the huge majority of that revenue was going to the big, ubiquitous sellers. Now, while the Internet helped these large sellers (and still does), it also has enabled smaller players to grow and entrepreneurs to launch ticketing web sites of their own.

The growth of the market and opportunities to become a player have profoundly changed the face of event ticket selling-all because of the Internet. Moving from past to present, the last three years have been marked by great decentralization of the event tickets industry, says Don Vaccaro, CEO of TicketLiquidator.com.

“A few years back, the majority of tickets were controlled by a couple of companies,” Vaccaro says. “However, the Internet has helped new players build a presence and acquire more and more tickets from those companies and other sources; it has enabled more competitors to take root in the market and grab market share. And now there are many players battling against each other and consequently becoming extremely efficient.”

Counting all sales channels, the event tickets market reaped about $30 billion last year, according to the U.S. Commerce Department. The online sales channel accounted for $3.4 billion of the total, according to The State of Retailing Online 2006, a Shop.org study conducted by Forrester Research Inc. Online event ticket sales are expected to jump 27% this year to $4.3 billion, the study predicts.

And that $4.3 billion is likely to be spread around a little more-because of the Internet. One contributing factor to this movement, for example, is the newfound ease, thanks to advances in e-commerce technology and services, with which venues themselves can launch e-commerce sites for the events they host.

“There soon will be more direct selling models created by venues and event organizers, whether it’s in music, performance, sports or other arenas,” says James Okamura, senior partner at retail consulting and research firm J.C. Williams Group Ltd. “Rather than go through intermediaries or aggregators like Ticketmaster and incur a charge and possibly upset your customers along the way, why not do it yourself? Big names like Chicago’s Second City comedy troupe and Wrigley Field already have started doing just that. It sure beats sitting outside for hours on the first day Cubs tickets go on sale.”

The bottom line, he adds, is today there simply are fewer barriers preventing venues as well as event organizers from having the same reach as the big, general ticket sellers.

 

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