The secondary ticket market, also known as ticket resale or ticket scalping, refers to the practice of reselling tickets for events. This market exists outside of the primary market, which consists of tickets sold directly by the event organizer. The secondary market provides several benefits to both buyers and sellers.
Benefits for Buyers
The secondary ticket market offers buyers several advantages:
Access to Sold Out Events
One of the biggest benefits is the ability to buy tickets to sold out or high demand events. Primary market tickets often sell out very quickly, especially for popular concerts, sports games, and other events. The secondary market gives buyers access to tickets, even if the primary market is sold out.
Ability to Shop for Best Price
Buyers can shop around and compare prices across multiple resale platforms and sellers. This allows them to find the best deal on tickets based on their budget and needs.
Last Minute Purchasing
The secondary market also allows for last minute ticket purchases. Whereas the primary market cutoff is typically weeks or months before an event, secondary market tickets are available right up until event time. This caters nicely to impulse purchases or people who decide to attend an event at the last minute.
Better Seat Selection
Secondary market tickets are not limited to the seats that were made available during the initial sale. Resellers often split up or break down undesirable blocks of seating, allowing buyers to purchase more preferable single seats or smaller lots.
No Sell Out Risk
There is essentially no risk of the secondary market “selling out” for high demand events. No matter when a buyer decides to make a purchase, there will almost always be inventory available.
Tickets As a Gift
The secondary market is a great option when purchasing tickets as a gift. Tickets can be bought closer to an event at a time that works best for the gift giver. There is also no risk of the tickets selling out before they can be purchased as a gift.
Benefits for Sellers
Selling tickets on the secondary market also comes with several advantages:
Profit Potential
The main motivation for most resellers is the ability to profit from high demand events. By buying tickets during initial sales and then reselling at a markup, there is substantial profit potential. Supply and demand dictates secondary market prices, which often exceed initial face value prices.
Event | Original Price | Resale Price |
---|---|---|
Concert Ticket | $50 | $150 |
Sporting Event Ticket | $75 | $225 |
As illustrated in the table, tickets for popular events can more than double in resale value from their original price.
Flexibility
Sellers have flexibility in choosing which tickets they resell and when they list them. They can buy as many desirable tickets as possible during initial sales and then hold and list them strategically based on timing, matchups, team records, and other factors.
Wider Reach
Resale platforms provide sellers access to a much larger pool of buyers across the country and even internationally. This increased market reach makes it more likely tickets will sell.
Passive Income
Reselling tickets takes some initial effort, but then generates passive income once tickets are listed. As long as there is demand, the seller continues earning money while doing minimal additional work.
Factors Driving the Secondary Ticket Market
There are several key factors that have enabled the growth and proliferation of the secondary ticket market:
Technology & Online Resale Platforms
The internet and emergence of large online resale marketplaces like StubHub, VividSeats, and SeatGeek have made it much easier for buyers and sellers to connect. These platforms provide national exposure for listings and convenient purchasing mechanisms.
Increasing Event Ticket Prices
As primary market ticket prices increase for high profile events, so does the potential profit margin for resellers. Higher face value prices allow for greater upside when reselling in the secondary market.
Limited Primary Market Inventory
Primary market tickets are limited for in-demand events, usually selling out quickly. This scarcity creates major demand in the secondary market from fans still looking to get into popular events.
Short Term Resale
Most secondary market tickets are resold within 60 days or less from an event. Short term resale facilitates last minute impulse purchases by buyers.
Fan Availability
Fans do not always know their availability at the time primary market tickets initially go on sale, which could be months or years before an event. As their schedules become clearer, the secondary market allows them to purchase at a later date.
Common Myths and Controversies
Despite its benefits, the secondary ticket market also comes with some common misconceptions and controversies:
Myth: All Tickets Are Overpriced
While some very high demand tickets command extremely high resale prices, there are also many reasonably priced options. Like any market, prices vary based on supply and demand dynamics. With some flexibility, buyers can often find good deals.
Myth: All Fees Are Excessive
Resale platforms charge fees to sellers and/or buyers as a way to generate revenue. However, fees are not excessive across the board. Some sites like Stubhub cap their fees, which helps limit buyer costs.
Controversy: Lack of Regulation
The secondary ticket market is largely unregulated compared to other resale markets. Some argue stronger regulation is needed to prevent fraud, price gouging, speculative ticket buying, counterfeits, and other unfair practices.
Controversy: Scalping
“Scalping” is seen negatively as the practice of buying tickets solely to resell at a higher price, often using bots. Many see it as unfairly profiting off passionate fans. But scalping persists due to basic economic incentives.
Is the Secondary Market Good for Consumers?
There are good arguments on both sides as to whether the secondary ticket market is good for consumers overall:
Arguments For:
- Provides ticket access that would otherwise not exist
- Allows fans to buy at fair market value based on demand
- Gives consumers choice in ticket purchasing options
- Enables last minute ticket buying
- Increases supply availability even for sold out events
Arguments Against:
- Can significantly drive up ticket prices
- Rewards large scalpers over individual fans
- Involves speculative buying and hoarding of tickets
- Has risk of fraud and counterfeit tickets
- Circumvents ticket limits and purchase rules
There are good points on both sides. While the secondary market does provide more purchasing options for fans, there are also concerns over fairness and consumer protection given limited oversight. Increased regulation may help strike the right balance for consumers.
The Future of the Secondary Ticket Market
Some possible predictions for where the secondary ticket market is headed in the future include:
- Continued expansion as primary market prices get increasingly more expensive
- Higher automated bot usage by large resellers to obtain high demand inventory
- Integration of secondary marketplaces into primary ticket sales
- More states regulating or restricting different resale practices
- Evolution of blockchain-based security and verification measures
- Potential growth of ticket resale platforms for niche events like conventions
Despite some ongoing controversies, the secondary ticket market is likely here to stay given its profitability. But increased regulation and oversight may help reshape practices to be more consumer friendly.
Conclusion
The secondary ticket market has firmly established itself as a massive industry due to high buyer demand and lucrative resale potential. For buyers, it provides more purchasing options and flexibility. And for sellers, there is upside to reselling high demand tickets at a premium. However, the market does have downsides like exorbitant prices and scalping. Increased regulation may help ease some of these concerns and make the secondary market more beneficial for average consumers.