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To Pay or Not to Pay to Play (Part 1 of 4)

Thursday, December 19, 2013 • Eric Gomez
The concept of covering costs and having hungry artists prove their ability to market themselves is not a new concept; but one that is quickly becoming normality among many promoters in various cities. Some artists and individuals strongly disagree with the model, so we'll explore the benefits as well as the drawbacks of the PAY 2 PLAY model.
One the most heated debates between artists and promoters today is the "pay to play" business model that many promoters often use to setup larger shows with headliners. The concept of covering costs and having hungry artists prove their ability to market themselves is not a new concept; but one that is quickly becoming normality among many promoters in various cities. Some artists and individuals strongly disagree with the model, so we'll explore the benefits as well as the drawbacks of the PAY 2 PLAY model.
 
What does PAY 2 PLAY look like? 
 
There are various ways that PAY 2 PLAY can be approached, so we will explore a few of the angles used specifically for concerts. There's an entirely different conversation when it comes to mixtape placements, radio and other media; but we will focus on the physical performance aspect of this conversation for now.
  1. The Direct Pay Approach - In this model, artists are given a set amount that they have to pay to get on the stage for a certain amount of minutes. They basically purchase a performance slot and the deal is done. Some of these costs could range from a few hundred to quite a few thousand depending on the headliner, the venue and of course… the promoter. 

  2. The Ticket Sales Approach - In this model, artists are required to sell a certain amount of tickets in order to get on the stage. At a specific day, they are to report back the numbers and turn in monies from ticket sales to solidify their spot.

  3. The Split Ticket Sales Approach - In this model, artists are required to sell a certain amount of tickets to get on the stage. They are also given a split of the money on each ticket, which can range from $1 to 50% of the ticket sales. Most times, it's a few dollars per ticket which allows the artist to sell the tickets at a lower price or reap the profits as small as they may be.
Currently, all of these 3 approaches are extremely common and utilized in most of the major city shows featuring national headliners; but there have been some recent occasions when promoters will also apply this to local shows; which seem to be picking up favor among promo companies who want to keep their marketing budgets low and efforts to a minimum.
 
The Benefits of PAY 2 PLAY
 
There are benefits to the business model, but the argument really ignites when the discussion of who benefits from the business model is discussed. Before we discuss WHOM it benefits the most, let's discuss the costs of creating a show with a national headliner. 
 
The cost of creating a quality show is not a light topic. Between venue costs, booking and rider costs, promotional media campaigns, flyers and staff and other miscellaneous stuff; putting on a good show could get very costly and seem like a daunting objective. The challenge most promoters face when creating a show is how to gain a profit from it enough to reinvest into the next show. Their main objective is to; at the very least, break even, and hopefully make some money. If that wasn't the case, promotions would not be a career worth pursuing. There has to be a bottom line at the end of the day or it's simply not a business. 
 
When employing the methods of PAY 2 PLAY, promoters gain some of the following assurances:
  • Up front money prior to ticket sales in order to cover some costs
  • Additional help on promotions by artists who promote to their own respective fan-bases
  • Wider audience in attendance, thus increasing their potential customers for future events
  • A position of authority and clout in the local area that makes them the go to person for artists who want to get on the stage at headliner shows.
Here's what the artist benefits are:
  • The opportunity to perform and secure fans off of a larger show 
  • The experience of selling tickets and perfecting your marketing efforts
  • Possible new fans and customers who will buy your CD and other promotional items hopefully at the same show
  • The networking experience (if any) with the major artist or other major movers in attendance
  • Possibly make some money on ticket sales if the arrangement included a percentage or commission
  • And yea…. Exposure (one of the most overly-used terms in the music industry)
When one looks at the system this way, it doesn't seem that bad and makes a little bit of sense. We won't take a definite stance on this as there are various business models that do and don't work for individuals. You have to find what works best for you. If you have a strong sales initiative, this may work well. If you're just a humble indie artist with loads of talent, you may not have the sales experience to pull it off, and you may need to find other viable ways to get on larger showcases.
 
The Drawbacks of PAY 2 PLAY
 
While the benefits of this angle seem very business friendly, there are some interesting social dynamics that are a direct result of PAY 2 PLAY practices. Some of these effects are immediate, and some are more long term risks involved with PAY 2 PLAY.
 
EFFECTS OF PAY 2 PLAY:
  1. SHOW QUALITY DROPS - While it can easily be said, great artists will promote themselves… the reality is most major artists don't promote a darn thing. They have a team who does it for them. Most artists are awkward types with great talent and they didn't expect to have a sales job. What that leaves is a random artist with a lot of friends, sales-types and drug budget teams on the table.

    Unfortunately, those are usually not the most talented artists on the scene and the opening acts are horribly ignored, ridiculed or written about by everyone but the few people in their own circle who tell them their performance was better than the headliner's. Even though a Barney commercial with Geico sponsored unicorns would have been more entertaining, well-talented acts are continually replaced by the money spenders. Let's just be honest about this for a little while.

  2. Acts Advertised DO NOT Perform - The uncertainty of a team's ability to sell "enough" tickets to get on the stage; coupled with the need for them to ADVERTISE that they are going on stage so their following can indeed buy a ticket could be a damaging practice for both artists and promoters. It kind of takes away the incentive for a person to buy tickets unless they are there FOR the headliner. In which case, artists are not really recruiting their following; they are just becoming extensions of the original promotion and selling tickets to the HEADLINER'S following.

    Do these paths cross? Sure they do. But there has to be a stronger call for artists, their fans as well as promoters to support a DEFINITE SHOW SET to provide incentive for more decided patrons whom buy tickets and feel sure of what they are purchasing. It just seems like a better sales approach anyhow.

  3. Brand Dwarfing - If you are always dependent on the headliner acts and their investors, and always taking the cheapest route as a promoter; there is no ability for you to create a quality production that sets you apart from every other promoter doing the same exact thing. If you want quality productions, you need quality talent who can interpret your themes and compliment your headliners to create bigger and better shows. The idea of business branding almost assumes its necessity for awareness and recognition. That's pretty hard to do without trying new things out and creating better ways to continually keep a demographic involved and exchanging with your brand.

  4. Talent Suppression - This is not a new problem to the indie music community, and this will continue being an issue until the artists in the indie market enforce standards of business practice that will make them more marketable and approachable for direct investors and shows.
SO IS IT BAD? ARE THEY ALL SNAKES?
 
Every situation is different, and artists have to take the role of business man or woman in these moments and be honest with him or herself. It's critical to review every situation independently from the other. Sometimes a deal is worth the effort if the team can execute; but sometimes it's more like chasing a nonexistent dream at a physical cost. Ask yourself and your team some honest questions on where you are in your career and if you want to focus on utilizing the opportunities for further sales and advertising opportunities, or if you're just throwing money away to be the popular kid on the scene with no forethought of creating contact lists to follow up with after those shows. If you can't measure physical results in sales or numbers, there's no point to it. These are business aspects every artist SHOULD be conscious of whether you do it for money or THE LOVE of the Art.

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