What Does it Mean to Sell Tickets at Face Value?
Selling tickets at face value means selling tickets for the exact price that is printed on the ticket. This is the original price that the tickets were sold for by the venue or event organizer. When tickets are resold at a higher price than face value, it is referred to as selling tickets above face value or “scalping.”
Why Do People Care About Face Value?
There are a few key reasons why selling tickets at face value matters to consumers:
- Fairness – Many feel that reselling tickets at a significant markup is unfair and exploitative. They believe tickets should be accessible to fans at reasonable prices.
- Anti-scalping laws – Some states have laws against scalping that require resellers to sell at face value or below. Selling above face value breaks those laws.
- Avoiding scams – If a seller promises tickets at or below face value, it’s less likely to be a scam. Conversely, inflated resale prices are a red flag.
- Price gouging – There is a perception that reselling tickets far above face value constitutes price gouging.
- Accessibility – Selling tickets at face value allows more fans to attend events who may not be able to afford inflated secondary market prices.
In general, selling at face value is seen as the most fair and ethical practice. It gives the average fan a fair shot at attending without having to pay extortionate resale markups.
When Can Tickets Be Sold Above Face Value?
In many jurisdictions, it is illegal to resell tickets above face value without permission of the issuer. However, there are some cases where resellers can legally sell above face value:
- The event organizer explicitly allows it – Some organizers like Broadway shows allow brokers and season ticket holders to resell at a profit.
- The tickets are resold on approved secondary sites – Major ticket resale platforms like StubHub have agreements in place with certain sports teams and venues.
- The sale happens outside the jurisdiction with anti-scalping laws – If the sale takes place fully online across state lines, local anti-scalping rules may not apply.
- It falls under exemptions for charity auctions or private sales – Some areas exempt charity fundraisers or private sales between individuals.
In general though, resellers need permission or authorization from the issuer if they want to legally resell tickets above face.
How Are Anti-Scalping Laws Enforced for Online Sales?
Online ticket resales can make enforcement difficult when sellers and buyers are in different jurisdictions. Areas with strict anti-scalping laws try to combat this by:
- Requiring resellers to be licensed – This allows states to take enforcement action against licensed resellers breaking the rules.
- Allowing event cancelation and blacklisting – Venues can cancel tickets suspected of being resold illegally online and blacklist those users.
- Monitoring major resale sites – Authorities try to find illegal resale activity on places like Craigslist and eBay.
- Undercover investigation & sting operations – Police posing as buyers arrange purchases with resellers to catch them breaking laws.
- Cease and desist orders – Issuers send warnings to known resellers ordering them to stop illegally reselling tickets.
Still, enforcement remains tricky in the internet age where illegal sales are easy to disguise online. Strict anti-scalping jurisdictions are constantly evolving tactics to try to limit unlawful resales.
Does Reselling Tickets Guarantee Profit?
There is no guarantee that reselling tickets will generate a profit. Some factors that influence whether a resale generates a profit include:
- Under face value sales – Some tickets end up being resold below face value if demand is low.
- Broker fees – Resellers often have to pay broker platform fees that eat into profits.
- Highly competitive markets – Lots of resellers competing to resell popular tickets drives down prices.
- Cancellations or non-transferability – Resellers take a total loss if events are cancelled or tickets cannot be transferred.
- Low buyer demand – Unpopular events will have few buyers willing to pay higher prices.
- Cost basis too high – Overpaying for the original ticket makes it harder to resell at a profit.
As a general rule, selling far above face value does not guarantee profitability. Resellers have to factor in all costs before assuming they will make money. The most profitable models involve minimising costs and focusing on high-demand events likely to command premium resale pricing.
Can Reselling Cause Problems for Buyers?
There are some potential issues buyers may encounter when purchasing resale tickets:
- Scams – Some resale tickets turn out to be fake, putting buyers at risk of losing money.
- Quality uncertainty – Resellers do not guarantee the seat location quality or exact specs of tickets.
- Non-transferability – Tickets may be cancelled or invalid if found to be resold against policy.
- Hidden restrictions – Resellers may fail to disclose ticket limitations like a restricted view.
- No recourse – Buyers have less recourse for problems versus directly from a venue.
To avoid issues, buyers should vet sellers carefully, buy from reputable sites, understand the ticket details, and use protected payment methods in case recourse is needed. Paying inflated prices also means taking on greater risk for buyers.
Is it Unethical to Resell Tickets?
The ethics of reselling event tickets are debated:
Arguments That Reselling is Unethical
- It prices regular fans out of the market – Reselling allows deep-pocketed buyers to edge out the average fan.
- It enables predatory pricing – There is little regulation on how high resellers can inflate prices.
- It circumvents intended ticket limits – Resale sites allow buyers to bypass ticket maximums enforced by venues.
- It disproportionately benefits scalpers – Individual resellers earn significant profits off scarce public tickets.
- It incentivises bad behavior – The profits motive scalpers to hoard tickets and shut out public access.
Arguments That Reselling Can Be Ethical
- It promotes free markets – Resale tickets reflect an open market value for a scarce resource.
- It increases access – Resales give more chances to buy for high-demand events.
- It allows fair prices – Willing buyers should be able to pay market rates set by supply and demand dynamics.
- It permits recouping costs – Resellers should be allowed to recoup their original purchase costs.
- It can provide convenience – Resale platforms offer buyer protections and convenient access.
There are good-faith arguments on both sides. In moderation, most opponents accept a limited secondary market. But systematic scalping purely for profit remains controversial.
How Has Ticket Resale Evolved?
Ticket resale has changed dramatically in recent decades:
Key Milestones
- Pre-internet: Small-scale local brokers and classified ads.
- Late 1990s: Online resale emerges on eBay and Craigslist.
- 2000s: Large national resale sites like Stubhub founded to expand market.
- 2010s: Resale sites begin partnering with teams and venues.
- 2020s: Resale inventory for some events surpasses 50% of all ticket volume.
Key Trends
- Mainstream acceptance of ticket resale as normal.
- Greater resale inventory driven by season ticket holders reselling extras.
- Proliferation of online exchange platforms for easy resale.
- Rise of full-time ticket brokers using bots and automation to source inventory.
- Pushback from fans against aggressive broker behavior like instantly reselling newly released tickets.
The resale market has exploded into a multi-billion dollar industry inseparably linked to primary ticketing systems. Debates continue around fair pricing, ethics, and regulation.
Does Resale Activity Signal Underpriced Tickets?
High volumes of ticket resales are sometimes seen as signaling an event’s tickets were underpriced. Reasons why heavy resale activity can imply underpricing:
- Huge profit potential – Large gaps between face value and resale value indicate unmet demand.
- Immediate sellouts – Sellouts and long virtual queues signify prices did not balance supply and demand.
- Rapid secondary market sales – Quick flips imply tickets were originally undervalued.
- Market inefficiency – Issuers set prices before gauging full demand in the market.
- Artificially low prices – Some issuers deliberately underprice to promote accessibility.
On the other hand, other factors also drive secondary sales besides pure underpricing:
- Speculators – Resellers try to profit even from fairly priced tickets by predicting hot events.
- Changed circumstances – Resellers adapt prices based on new info like performer lineups.
- Scarce supply – Limited tickets will have resale demand even at optimal pricing.
- Transferability – Easy exchanges incentivise resale even for fairly priced tickets.
- Season tickets – Split packages lead holders to resell some events.
Still, large resale markups often do signal issuers failed to fully maximize revenue with the initial pricing and sales.
Should Ticket Releases Be Staggered to Limit Resales?
Some event organizers stagger ticket releases over multiple sale dates rather than all at once. Potential pros of staggered ticket releases:
- Prevents resellers instantly grabbing large volumes.
- Lets issuers adjust future pricing based on initial demand.
- Creates more sales momentum and fan awareness over time.
- Gives regular fans multiple chances to purchase.
- Generates continuous media and social buzz.
However, cons of staggered ticket releases also exist:
- Harder for buyers accustomed to single on-sales.
- May encourage bot attacks over multiple sale dates.
- Does not prevent season ticket holders reselling extras.
- Potentially more expensive to administer over multiple sales.
- Does not solve the core supply shortage issue.
While it can help limit opportunistic scalpers, staggered sales alone rarely eliminate broader market dynamics driving secondary sales. More effective policies address core supply constraints.
Conclusion
Selling tickets at face value promotes accessibility, fairness, and ethics for fans while preventing exploitative scalping practices. But practical enforcement of face value requirements remains difficult, especially online. The ticket resale industry has permanently added a secondary market dynamic to event ticketing that cannot be entirely regulated away. Demand-based pricing, transparency, consumer education, and anti-scalping laws that target abusive behavior may be the most pragmatic policies going forward.