On Wednesday 25 November 2009, the Dutch House of Representatives will discuss the resale of tickets to events. The SP is against ticket dealers making exorbitant profits. Research by the University of Groningen, however, has revealed that reselling only takes place on a limited scale in the Netherlands. We’re talking about less than four percent.
The official market for tickets for concerts, theatre productions and sports events in the Netherlands is over EUR 3 billion a year. Never before has the turnover of ticket resales been investigated. Research by the Customer Insights Center of the University of Groningen has provided the first insight.
The research reveals that of all the tickets sold annually for concerts, sports events and theatre productions, 3.7 percent were sold on via resellers. This percentage is much lower than previously assumed. Researcher Dr Jelle Bouma: ‘It’s always been assumed that the market share of resellers in the Netherlands was comparable with that in the United States, where about 10 percent of tickets are sold on. However, it all happens on a much smaller scale in the Netherlands. In addition, we did not find a single reseller in our research that was so dominant that it could disrupt the market.’The research also revealed that the price increases for popular events are not just profit for the resellers – they also have to cover their costs. They actually make an average of about 11 percent profit on the tickets – 5, 0 and 18 percent profit respectively for concert, theatre and sports events tickets.
‘We don’t think that the resellers cause any problems,’ concludes Bouma on the basis of the research. Despite this, resellers – often called black marketeers – do not have a good reputation. That’s not completely justified, thinks the researcher: ‘It’s good for the economy that there are resellers in a market like this. They ensure an efficient distribution of the tickets.’ Some people are prepared to spend the night in a sleeping bag at an official sales point, others prefer to buy their tickets later from behind their computer and for a higher price. Bouma: ‘If, for example, you have a busy programme and can’t say so long in advance whether or not you will be able to attend on a certain date, you’ll be more inclined to buy a ticket at the last minute. It’s only logical that that will cost more – convenience always costs money.’In addition, resellers are not the only ones to implement price rises. The same method is applied when it comes to airline tickets and the government’s road pricing system, according to Bouma. ‘Raising or lowering the prices means that supply and demand will balance out over time. This principle is also known as dynamic pricing.’
Despite all this, visitors can still find the price unreasonable, says Bouma. ‘Every company thinks it’s important that customers pay a reasonable price because otherwise there’s negative word-of-mouth advertising and public opinion is influenced negatively. In order to improve that image, we would advise the resellers to make the reasons for the price differences clearer. If event visitors understand the costs that resellers have, that may remove much of the secrecy.’ He also has a suggestion for the official sales points: ‘If they reserve some tickets for sale later, for example a week before an event takes place, they would dovetail better with what the punters actually want – the flexibility to choose when and at what price they buy a ticket for an event.’
More information: Dr Jelle T. Bouma, managing director of the Customer Insights Center, University of Groningen, tel. 050-363 7065, e-mail: email@example.com
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