Ticketmaster is a major ticket sales and distribution company that sells tickets to various live entertainment events. In addition to selling tickets directly, Ticketmaster also provides a platform for ticket resale through its Ticketmaster Resale (or Ticket Exchange) marketplace.
How Ticketmaster’s resale marketplace works
The Ticketmaster Resale marketplace allows ticket holders to resell event tickets they can no longer use. This provides a way for fans to safely buy tickets from other fans and for sellers to recoup some of the cost of an unused ticket.
Tickets sold through the Ticketmaster Resale marketplace include tickets originally purchased through Ticketmaster as well as tickets bought from other sources. Sellers list their tickets for sale on the resale marketplace and set their own ticket prices.
Tickets bought via Ticketmaster originally
For tickets originally purchased through Ticketmaster, the original ticket price and associated fees are already set by Ticketmaster and the event organizer or artist. The seller sets the resale price and Ticketmaster adds on a resale service fee.
Tickets bought from other sources
For tickets that were not purchased directly through Ticketmaster, the seller sets the ticket price themselves. Ticketmaster then tacks on their resale service fee.
How sellers set resale ticket prices
When reselling tickets on Ticketmaster, the seller has full control and discretion in setting the resale ticket price. There are no price caps or limits imposed by Ticketmaster. Sellers can price the tickets at any amount they choose.
Some factors sellers may consider when setting a resale price include:
- The original ticket price and associated fees they paid to acquire the tickets
- Current demand for the event tickets
- Prices that similar tickets are selling for on Ticketmaster Resale and other secondary markets
- Whether the event is sold out or highly desirable/exclusive
- The specific seat location – front row or VIP tickets can demand higher prices
- How soon the event is approaching – last minute tickets often sell for more
- Their desired profit margin on the sale
Using these factors, sellers list their tickets at prices they feel the market will bear and that will net them a profit. Some aim to recoup their original cost, while others set higher prices to maximize profit.
Ticketmaster’s resale service fees
In addition to the ticket price set by the seller, Ticketmaster also collects a service fee on all resale ticket transactions. This fee is taken as a percentage of the total ticket resale price.
Ticketmaster does not disclose the exact percentage amount of their resale service fee. However, it has typically ranged from about 10-25% of the ticket resale price.
For example, according to reports, in 2017 Ticketmaster’s resale service fee was about 20% of the ticket price. So if a ticket was resold for $100, Ticketmaster would collect a $20 fee, the seller would get $80, and the buyer pays $100 total.
The resale service fee goes to Ticketmaster and is separate from any amount the seller receives for the ticket.
Why sellers may set high resale prices
There are several reasons why sellers may set very high resale prices on tickets on Ticketmaster, sometimes pricing tickets many times higher than face value:
High demand events
Some concerts, games, and other events have extremely high demand in the resale marketplace, especially if the event is sold out. Fans who missed out are willing to pay premium prices to attend. Sellers capitalize on this demand.
Profit motive
Sellers aim to resell their tickets at the highest price the market will bear in order to maximize their profit. For high-demand events, this can mean very steep markups.
Covering Ticketmaster fees
Ticketmaster service and delivery fees on the original ticket purchase can be substantial. In some cases, sellers factor these fees into their pricing so they can recoup the total costs paid.
Speculative pricing
Some sellers purposely set very high speculative prices on tickets hoping there may be some buyers willing to pay exorbitant prices for in-demand events.
Artificially inflate prices
There have been reports of some large ticket brokers using scalping bots to buy up tickets and then list them at inflated resale prices. This tactic aims to drive up resale market values.
Is TicketmasterResale pricing regulated?
There are currently no laws or regulations imposing limits on how high resellers can price event tickets on Ticketmaster Resale or other secondary ticket marketplaces.
Ticketmaster maintains that ticket prices on its resale marketplace are set entirely by individual sellers, not Ticketmaster itself.
Some anti-scalping laws have been proposed to cap ticket resale prices, but they have faced opposition and have not been widely adopted due to criticisms that they violate free market principles.
As a result, sellers on Ticketmaster Resale and other secondary markets are generally able to price event tickets at any amount the market will bear, even if vastly above face value.
Factors driving high ticket resale prices
Several key economic and industry factors enable and drive the extremely high prices often seen in the ticket resale market:
Limited supply
Many major concerts and sporting events take place in arenas with limited seating. Supply is capped at venue capacity, so high demand drives up resale prices.
Lack of price caps
With no price limits on the secondary market, inflated prices are able to prevail.
Speculators and scalpers
Professional ticket brokers and scalpers often buy up significant ticket inventory using bots and then relist them at huge markups, artificially inflating the market.
Convenience fees
Substantial convenience and processing fees added by Ticketmaster and other ticket sellers reduce supply of lower priced tickets.
Lack of regulation
The limited regulation of the secondary ticket market enables speculative pricing and scalping activity to drive prices upward.
Does Ticketmaster profit from higher resale prices?
Ticketmaster itself denies that it profits from higher ticket resale prices on its platform. As noted above, Ticketmaster states that ticket prices are set solely by sellers in the marketplace.
However, Ticketmaster does benefit from higher resale prices in the following ways:
- Its resale service fee is a percentage of the ticket price. So when tickets are resold at higher prices, Ticketmaster collects a higher fee.
- Higher resale demand attracts more sellers and buyers to use its platform, increasing total transaction volume and Ticketmaster’s revenue.
- Tickets sold on Ticketmaster’s official primary sales platform at face value become more attractive relative to inflated resale prices.
So while Ticketmaster does not directly set resale prices, the company and its parent Live Nation likely benefit significantly from the extremely high Ticketmaster resale prices driven by market factors.
Options for buyers to avoid high resale prices
For fans looking to get tickets to in-demand events without paying exorbitant secondary market prices, here are some options:
- Purchase tickets during the initial primary sale when they are first released at face value prices. Sign up for presales and alerts from the event promoter or venue.
- Join fan clubs or credit card programs that give you access to special presales before the general public.
- Use ticket request contests and giveaways to score free or discounted tickets.
- Wait until close to event to buy. Resale prices often drop at the last minute as sellers slash prices.
- Buy resale tickets just after initial onsale when prices are lower before hype builds.
- Buy single tickets rather than pairs which are more limited.
- Buy partial or obstructed view seats which command lower prices.
- Avoid extremely high demand and sold out events where prices will be inflated.
Following these tips can help fans gain access to face value or reasonably priced event tickets without getting gouged too badly by speculative secondary market pricing.
Conclusions
In summary:
- Sellers on Ticketmaster Resale set ticket resale prices themselves with no limits.
- High demand and lack of regulation enable sellers to charge exorbitant markups.
- Ticketmaster benefits indirectly from high ticket resale prices through fees and increased marketplace activity.
- Fans can use various tactics to find tickets at non-inflated prices.
The largely unregulated nature of the secondary ticket market continues to make buying tickets a challenge for fans. Knowledge of sellers’ pricing practices and smart buying strategies are key to avoiding stratospheric resale prices. While calls persist for more oversight and consumer protections, buyers need savvy and persistence to secure affordable tickets.