# Why is ticket scalping a viable business? **URL:** \ **Category:** Factual Questions\ **Created:** [January 29, 2016, 8:35am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562 "2016-01-29T08:35:56Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![bob\_2](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bob_2/32/3341_2.png) [@bob\_2](https://boards.straightdope.com/u/bob_2)\ **Post date:** [June 14, 2016, 11:33am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/61 "2016-06-14T11:33:33Z")
Maybe facial recognition is the way to go? I book seats from the organiser and send them a picture of all the people I am buying seats for. At the door, the scanner matches faces or you don’t get in. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [June 14, 2016, 11:50am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/62 "2016-06-14T11:50:10Z")
But again, if they just sold them for what the market would bear, it would all be irrelevant and unnecessary. ---
**Author:** ![BwanaBob](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bwanabob/32/2985_2.png) [@BwanaBob](https://boards.straightdope.com/u/BwanaBob)\ **Post date:** [June 14, 2016, 12:00pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/63 "2016-06-14T12:00:12Z")
> [@SlackerInc](#): > > I’m just having trouble understanding why the people who have this scarce good should feel compelled to sell it for far below what the market would bear, and what the demand suggests, and then further implement elaborate systems to prevent market forces from coming into play to bring it to its true price. The way I would see it if I were a performer is that “I” would be selling non-transferrable licenses to see me perform, and that is what I would call it in any advertisement, not a “ticket”. I set the price, no one else. Think of it as a private party where I say who comes in and what they pay (if anything). If you think I’m selling low, tough shit, it’s none of your business. I am not giving permission to allow an after market on my property. I only want people in who want to be there. You are not allowed a “license” if you’re not coming. ---
**Author:** ![Caldazar](https://avatars.discourse-cdn.com/v4/letter/c/8e8cbc/32.png) [@Caldazar](https://boards.straightdope.com/u/Caldazar)\ **Post date:** [June 15, 2016, 2:30am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/64 "2016-06-15T02:30:01Z")
> [@SlackerInc](#): > > The producers of the Broadway smash (and cultural phenomenon) \*Hamilton \*have responded to the huge markups scalpers are selling tix for by [massively hiking the face value](http://www.playbill.com/article/new-block-of-hamilton-tickets-go-on-sale-to-public-at-11-10-pm) of their premium seats, to a Broadway record of $849. But they are also doubling the number of front-row seats they sell by lottery daily for $10 each. Seems like a good compromise. And they’re getting backlash from segments of the theater fanbase accusing them of being too greedy. Given _Hamilton’s_ popularity, it doesn’t initially seem like the face-value price hikes will hurt them much. Nevertheless, over and over again, you see that fans can behave irrationally. It genuinely matters to some fans who exactly gets the $849 that was paid. $200 to the producers, $649 to brokers/resellers/scalpers, no problem. $849 all to the producers, “Greedy!”. The PR aspects to intentional ticket underpricing are very real. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [June 15, 2016, 2:40am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/65 "2016-06-15T02:40:53Z")
> [@Caldazar](#): > > And they’re getting backlash from segments of the theater fanbase accusing them of being too greedy. Given _Hamilton’s_ popularity, it doesn’t initially seem like the face-value price hikes will hurt them much. Nevertheless, over and over again, you see that fans can behave irrationally. It genuinely matters to some fans who exactly gets the $849 that was paid. $200 to the producers, $649 to brokers/resellers/scalpers, no problem. $849 all to the producers, “Greedy!”. The PR aspects to intentional ticket underpricing are very real. Yeah, as we saw with the Taylor Swift example. I just don’t understand why people don’t see that the morality of this distinction is completely backwards. It’s much worse for middleman who don’t create any value to take the lion’s share of the cost of a ticket, vs. the people who actually create the product that’s on stage. This seems so blindingly obvious, I just can’t remotely comprehend why people would see it the other way 'round. ---
**Author:** ![Count\_Blucher](https://avatars.discourse-cdn.com/v4/letter/c/c5a1d2/32.png) [@Count\_Blucher](https://boards.straightdope.com/u/Count_Blucher)\ **Post date:** [June 15, 2016, 2:48am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/66 "2016-06-15T02:48:03Z")
Sometimes I wonder if performers care that they are playing to the same group of rich assholes over and over and over. Probably not. ---
**Author:** ![Caldazar](https://avatars.discourse-cdn.com/v4/letter/c/8e8cbc/32.png) [@Caldazar](https://boards.straightdope.com/u/Caldazar)\ **Post date:** [June 15, 2016, 3:12am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/67 "2016-06-15T03:12:16Z")
> [@SlackerInc](#): > > Yeah, as we saw with the Taylor Swift example. I just don’t understand why people don’t see that the morality of this distinction is completely backwards. It’s much worse for middleman who don’t create any value to take the lion’s share of the cost of a ticket, vs. the people who actually create the product that’s on stage. This seems so blindingly obvious, I just can’t remotely comprehend why people would see it the other way 'round. I’m not sure “morality” is the proper term here, but in any case, when your business is entertaining others, the image you project becomes relevant. Rightly or wrongly, many fans care about who you are, or at least who they think you are. It’s not enough to put on an entertaining show; many fans want their entertainers to be “nice people”, to be “not too greedy”, to be “doing it for the fans”, and so on. The entertainers need to try to meet those expectations in some capacity, or they risk losing popularity. The fact that ticket pricing is not so much about greed and is instead more a function of supply and demand, this is not necessarily relevant to people’s perceptions. Even on here, in IMHO, there are sometimes discussions about whether an artist’s perceived personality or actions affect one’s enjoyment of their work. If you find the artist’s work entertaining, then rationally, it shouldn’t really matter who the artist is when he/she isn’t entertaining you. But it matters to many people. ---
**Author:** ![wolfpup](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/wolfpup/32/10618_2.png) [@wolfpup](https://boards.straightdope.com/u/wolfpup)\ **Post date:** [June 15, 2016, 3:15am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/68 "2016-06-15T03:15:34Z")
> [@RickJay](#): > > Not necessarily. There’s three things you have to consider about the scalping business. > > 1. In many cases the tickets are being purchased by the scalper far below face value. Sporting events are especially prone to this because many tickets are bought in the form of season tickets (which confers a discount) and the tickets for particular games are sold by the season ticket holder to scalpers (conferring another discount.) If you’re a Yankees season ticket holder you might not be able to go to all 81 games and will dump your tickets on a scalper for way below list price. > > Even knowing that, though, the season ticket approach, which is done not just for sports teams but other types of events, too, is favourable to the venue/team because it’s guaranteed up front income. > > 1. Price discrimination is hard. You describe a sort of ideal price discrimination scenario, but realistically if a team, venue, or concert hall tried something like that it would take people nine seconds to figure the system out. > > 2. Price discrimination is terrible, terrible PR. Boosting people for a thousand dollars to see a show is something you EXPECT of a scalper; you know the scope there. If the venue did that, though, it would reflect poorly on the artist/team/whatever and the venue. The key I think is #3. Point #1 isn’t a big deal because, at least in my limited experience, season tickets don’t really confer a big discount, just a marginal one. A good illustrative example of all this is tickets to Toronto Maple Leafs games. I can’t remember the difference between season ticket rates and ticket face values but it’s just a small percentage per ticket. It’s completely insignificant compared to the _ **multiples** _ of face value that tickets often sell for through resellers. This is all driven by the city being a maniacal hockey town like no other, to the point that single-game tickets are pretty much unavailable (they do come online a few times per season but there are a very limited number because almost all seats are held by season ticket holders) and sell out within minutes. Meanwhile those seeking season seats as an alternative find that the waiting list for the affordable upper bowl stretches, literally, into future generations. By the logic of supply and demand, Maple Leaf Sports & Entertainment should be able to double or triple ticket prices and still fill the arena every single game. The problem, to say the least, is PR: they are already the richest, highest valuation team in the NHL by far, with (I believe) already the highest ticket prices, and are being rightfully criticized for avaricious greed. They have currently managed to combine this with the worst season in the league and the longest Stanley Cup drought ever (since 1967). What do you suppose would happen if they doubled their ticket prices? I doubt the NHL would condone it for a second, but even if they did, it would definitely cause mass bailouts among season seat holders. Would replacements come flooding in? The lifeblood of a sports team is its fans, and becoming universally loathed is not exactly a winning business strategy. ---
**Author:** ![drachillix](https://avatars.discourse-cdn.com/v4/letter/d/48db29/32.png) [@drachillix](https://boards.straightdope.com/u/drachillix)\ **Post date:** [June 15, 2016, 4:20am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/69 "2016-06-15T04:20:47Z")
> [@wolfpup](#): > > By the logic of supply and demand, Maple Leaf Sports & Entertainment should be able to double or triple ticket prices and still fill the arena every single game. The problem, to say the least, is PR: they are already the richest, highest valuation team in the NHL by far, with (I believe) already the highest ticket prices, and are being rightfully criticized for avaricious greed. So bumping ticket prices and going hog wild on donations to community projects, jumpstarting local charities, building affordable housing, etc, etc. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [June 15, 2016, 7:43am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/70 "2016-06-15T07:43:24Z")
> [@drachillix](#): > > So bumping ticket prices and going hog wild on donations to community projects, jumpstarting local charities, building affordable housing, etc, etc. This is a great idea! ---
**Author:** ![bob\_2](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/bob_2/32/3341_2.png) [@bob\_2](https://boards.straightdope.com/u/bob_2)\ **Post date:** [June 15, 2016, 11:00am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/71 "2016-06-15T11:00:15Z")
Same thing happens here at Wimbledon. Most seats on Centre court are ‘owned’ by corporations, but there are some kept back for the fans who are keen enough to queue all night and pay at the gate. The latest problem is people who pay others to queue and just turn up at the last minute. ---
**Author:** ![octopus](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/octopus/32/3716_2.png) [@octopus](https://boards.straightdope.com/u/octopus)\ **Post date:** [June 15, 2016, 3:22pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/72 "2016-06-15T15:22:14Z")
> [@Count\_Blucher](#): > > Sometimes I wonder if performers care that they are playing to the same group of rich assholes over and over and over. > > Probably not. The truly rich bring the concert to them. [https://youtu.be/I8WirP7QojY](https://youtu.be/I8WirP7QojY) ---
**Author:** ![muttrox](https://avatars.discourse-cdn.com/v4/letter/m/a8b319/32.png) [@muttrox](https://boards.straightdope.com/u/muttrox)\ **Post date:** [June 15, 2016, 6:58pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/73 "2016-06-15T18:58:02Z")
> [@octopus](#): > > The truly rich bring the concert to them. [https://youtu.be/I8WirP7QojY](https://youtu.be/I8WirP7QojY) Sure, most artists have set prices for private shows. Our annual sales conference has let me see Lenny Kravitz, Kid Rock, Maroon 5, Gladys Knight, Blondie, Poison, a few others from very up close. Many in sales and the corporate world have similar experiences. They are expensive, but… not _that_ expensive. A while ago some agency accidentally put their price sheet out in public. Fascinating to see the going price. If I win the lottery, first thing I’m doing is hiring Pete Townshend to play my birthday party. ---
**Author:** ![DesertDog](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/desertdog/32/11503_2.png) [@DesertDog](https://boards.straightdope.com/u/DesertDog)\ **Post date:** [June 15, 2016, 7:12pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/74 "2016-06-15T19:12:34Z")
I am a burner, a regular attendee of Burning Man. The number of tickets that could be sold has always been limited by the Bureau of Land Management but until 2011 that did not matter – there were always tickets still available on opening day and beyond. 2011 that all changed; the tickets ran out in May. This caused quite a scramble as a lot of camps had the habit of prepping for the event but put off buying a ticket until the [later](https://www.youtube.com/watch?v=5oyk63br0tY). Things were smoothed over a bit by making some 10,000 tickets that were being held back for last-minute purchasers available to established camps so they could get at least their core people there. Since the point of the event (believe it or not) is not to make money, the organization keeps the price as low as possible, commensurate with costs, and takes a dim view on tickets being sold for more than face value. While tickets can be found offered on StubHub and similar sites (currently beginning about twice face-value), if the ticket number is discovered, it will be cancelled, the original purchaser refunded, and the ticket’s number disclosed on an ever-updated list. To best serve the different demands made, a really [complicated](http://tickets.burningman.org/) process has evolved. If you have more money than patience, you can buy during the pre-sale for a higher price. This pretty well guarantees you a ticket (they did not sell out this year) but besides that, all you get for the higher price is the warm, fuzzy feeling it helps subsidize the lower ticket tiers. Next is the directed group sale. A camp that has a proven track record will be given the right to buy a certain number of tickets at face value to ensure at least the core members of the camp will be there. The guy in charge determines who gets these tickets. I am in a camp of about 200; last year we got 18 tickets. Next the bulk of the tickets are sold through the main sale. They’re gone in a matter of seconds and historically the remand to ticket ratio has been 4:1 Next, a small group of tickets are sold for a lesser price through the Low Income Ticker Program. These always completely sell out because they go through the list of applicants until the last one is gone. Finally is the OMG sale where a really small (1,000 plus the cancelled and any pre-sales that didn’t go) amount are sold for the regular price. For those who bought extra tickets or wind up not being able to go after all, there is the Secure Ticket Exchange Program (STEP) People with tickets put them into the system for a refund and they are parcelled out to those who need them. This, of course, is far more complicated than most venues or acts are willing to go through but it is effective. The estimate is that last year about 1% of Burning Man tickets were sold for more than face value. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [June 16, 2016, 7:21am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/75 "2016-06-16T07:21:50Z")
Interesting. Going to Burning Man is on my bucket list, but it sounds like I may not be able to cross that one off. ---
**Author:** ![DesertDog](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/desertdog/32/11503_2.png) [@DesertDog](https://boards.straightdope.com/u/DesertDog)\ **Post date:** [July 20, 2016, 12:02pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/76 "2016-07-20T12:02:36Z")
> [@SlackerInc](#): > > Interesting. Going to Burning Man is on my bucket list, but it sounds like I may not be able to cross that one off. It helps to be a member of the community as people with extra tend to sell/give them to people they know before submitting them to STEP. Because not everyone gets to go, there’s been a Burning Man diaspora and you can be a Burner without having attended That Thing in the Desert. [Regional](http://regionals.burningman.org/) burns and more frequent, more local meet-ups have taken up the slack. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [November 14, 2017, 9:52am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/77 "2017-11-14T09:52:27Z")
Richard Thaler [just won the Nobel](https://www.vox.com/policy-and-politics/2017/10/9/16447752/richard-thaler-nobel-explained-economics) for, in part, examining this phenomenon: > [@](#): > > The endowment effect helps explain why businesses don’t engage in rational behavior if it’s likely to enrage their customers. Take, for instance, concert venues that know their events are likely to sell out quickly, and yet do not jack up ticket prices to hundreds or thousands of dollars to control the demand. Because jacking up the price would entail taking away something people are used to — reasonable ticket prices — it prompts a strong feeling of repulsion and injustice, which can lead to consumers turning on businesses and hurting them more than raising prices would help. And since this is all about PR and brand image, it makes perfect sense that venues and promoters would have a strong incentive to secretly sell tickets under an alternate identity as a scalper, as long as they aren’t found out by most of their customers. ---
**Author:** ![Jophiel](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jophiel/32/66_2.png) [@Jophiel](https://boards.straightdope.com/u/Jophiel)\ **Post date:** [November 15, 2017, 6:31pm UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/78 "2017-11-15T18:31:26Z")
> [@SlackerInc](#): > > And since this is all about PR and brand image, it makes perfect sense that venues and promoters would have a strong incentive to secretly sell tickets under an alternate identity as a scalper, as long as they aren’t found out by most of their customers. You package the seats with some nominal cost add-ons (parking pass, some concert tchotchkes, etc) and sell it at a 1000% markup as a “[Platinum package](http://ajournalofmusicalthings.com/whats-deal-ticketmasters-official-platinum-seats/)”. ---
**Author:** ![SlackerInc](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/slackerinc/32/275_2.png) [@SlackerInc](https://boards.straightdope.com/u/SlackerInc)\ **Post date:** [November 16, 2017, 1:59am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/79 "2017-11-16T01:59:32Z")
> [@Jophiel](#): > > You package the seats with some nominal cost add-ons (parking pass, some concert tchotchkes, etc) and sell it at a 1000% markup as a “[Platinum package](http://ajournalofmusicalthings.com/whats-deal-ticketmasters-official-platinum-seats/)”. Clever! And premium seats are only available this way? ---
**Author:** ![Jophiel](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/jophiel/32/66_2.png) [@Jophiel](https://boards.straightdope.com/u/Jophiel)\ **Post date:** [November 20, 2017, 4:59am UTC](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562/80 "2017-11-20T04:59:40Z")
> [@SlackerInc](#): > > Clever! And premium seats are only available this way? That’s my understanding. I was reminded of this thread when I went to look at Hamilton tickets. Out of a 1,500 seat theater in Chicago, nearly 600 seats on a particular date (Fri, Jan 19) were available for sale via a ticket broker. Despite their efforts, they’re obviously leaving quite a bit of money on the table. At the same time, TicketMaster has seats available direct that are “Premium Seating” and still unsold. So one seat (center section, row U) sells on a broker for $315 because they bought it for $180. Meanwhile, TM is selling the seat directly in front of it for $497 + TM Fees. [Previous page](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562.md?page=3) [Next page](https://boards.straightdope.com/t/why-is-ticket-scalping-a-viable-business/744562.md?page=5)