What is dynamic pricing?

When a seller doesn’t set a fixed price for their product, but instead adjusts their prices in response to changing demand. Airline tickets and hotel rooms are a common example, which increase during school holidays or weekends. More recently, companies like ride-hailing app Uber have used “surge pricing” to adjust prices more quickly, in response to real-time demand fluctuations. Unlike ticketing, this theoretically balances the supply and demand equation by attracting more drivers to the area.

What about live music?

For the biggest artists, the limited capacity of the venue often means that demand far exceeds supply.

In the US, dynamic pricing has long been the standard approach to this imbalance, with prices going up for the most sought-after shows. In the UK, artists have historically been more restrained, keeping ticket prices artificially low so that entry becomes more about luck and dedication than the size of your wallet. In recent years, however, dynamic pricing has become increasingly common.

How did dynamic pricing take off in the UK?

In 2018, Ticketmaster had its regular “primary” ticketing business, but also owned two “secondary” ticketing websites, GetMeIn and Seatwave.

Secondary sites, which allow people to resell at any price, are being overrun by professional touts, who can flip thousands of tickets for a huge profit. Amid public outcry over touting, Ticketmaster shut down GetMeIn and Seatwave in a public relations victory.

Fans soon began to notice the rise of Ticketmaster Platinum, a controversial “premium” service that trickled more expensive tickets onto the market after concerts had supposedly sold out. That year, Paul McCartney’s UK tour had seemingly sold out in minutes. But seats at Glasgow’s SSE Hydro, which had been on sale for £65, were later released through Platinum for more than £500.

Can Artists Stop Dynamic Pricing?

The decision ultimately rests with the artist, their managers and promoters. However, Ticketmaster is owned by Live Nation, a global promotions and ticketing company that is the dominant force in live music in most major economies. There is a reason to advocate dynamic pricing, because Ticketmaster takes a cut of the ticket price. The higher the price, the bigger the discount.

Music industry sources say artists are often told that dynamic pricing prevents touts from ripping off fans. In theory, the higher face value reduces the margin touts can offer. However, Oasis tickets are also dynamically priced in Ireland, where resale for profit is illegal and secondary sites do not advertise tickets for Croke Park shows.

Are there any other factors?

Music streaming services like Spotify have all but destroyed the ability of artists to make money from album sales, meaning that country-hopping tours have become a much more important source of revenue. In that sense, an Oasis fan who streams Don’t Look Back in Anger without paying for it is partly complicit in the eye-watering profit they may have to pay to actually see the Gallagher Brothers perform it.