The High Cost of Live Music: How “Funflation” is Changing the Game
The Rise of “Funflation”
As we gear up for another exciting year of live music events, concert-goers are bracing themselves for the increasing cost of admission. According to the Bureau of Labor Statistics, ticket prices for movies, theaters, and concerts have jumped 20% since 2021. Despite this, fans are showing a high tolerance for the rising prices, with many willing to splurge on their favorite shows.
The Allure of Live Music
A recent report by CouponCabin found that nearly 36% of music fans plan to spend $100 to $499 on concert tickets in 2025, while over 17% are willing to shell out up to $1,000. This trend is driven by the desire for unique experiences, with younger adults, particularly Generation Z and millennials, willing to go into debt to pursue these experiences.
Dynamic Pricing: The Culprit Behind Rising Ticket Prices
Dynamic pricing, a practice originally coined by economists in the late 1920s, is partly to blame for the escalating cost of concert tickets. This involves charging higher prices during times of greater demand, similar to how airline ticket prices or ride-hailing services adjust fares during peak hours. According to Joe Bennett, a forensic musicologist at Berklee College of Music, dynamic pricing has become the norm in the live music industry.
The Controversy Surrounding Dynamic Pricing
The use of dynamic pricing has sparked controversy, with many fans feeling taken advantage of. Ticketmaster is currently under investigation in the U.K. for its use of dynamic pricing in sales of reunion concerts from Britpop band Oasis. Taylor Swift, on the other hand, reportedly refused to dynamically price her Eras Tour tickets, citing concerns for her fans.
The Shift in Revenue Streams
Throughout the 21st century, revenue from recorded music has declined, while revenue from live music events has increased. By the mid-2000s, concerts had become a larger source of income for performers than record sales or publishing royalties. Live music industry revenue jumped 25% in 2023 alone, according to data from Statista.
The Future of Live Music Ticketing
As consumers continue to prioritize discretionary spending on live music experiences, dynamic pricing is likely to remain a staple of the industry. While fans may not like the idea of dynamic pricing, it’s clear that ticket sellers are aware of the “YOLO” attitude that drives spending on these experiences. As Greg McBride, chief financial analyst at Bankrate.com, notes, “Consumers don’t like the idea of dynamic pricing, but there is a renewed attitude over the past few years since the pandemic, and increasingly, that drives a devil-may-care approach when it comes to spending on discretionary experiences.”
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