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I was chatting with my friend, Simon, yesterday and we agreed…a great sign is that the Premier League is back and “Come On You Spurs!” If anyone needs me this afternoon, I’ll be watching football.
Come have a drink with me and Ken Troupe tonight at 5 PM EDT. I’ll be having a nice new bourbon from One Eight in DC. A local dad owns the distillery and his son plays on my soccer team…so winning!
If you haven’t jumped in the Slack channel yet or lately, we had a couple of really good threads this week on the secondary market, shows coming back, and general business acumen.
To the tickets!
Simon shared the story of “The Stockdale Paradox” with me yesterday because we were both talking about how it can feel like a bit of a struggle to keep our focus and to know how to deal with keeping our businesses moving forward when the world is paused and we don’t know if we are at the beginning, middle, or end of our fight with the pandemic.
The Stockdale Paradox came from a book that many of you may have heard of called, Good to Great.
I have to say, I read a great deal. Tony Knopp has said offering me a book to read is especially difficult because I am one of the more well-read folks in the business. I bring that up because I had bought the book before the pandemic one morning when I was walking but didn’t hear about Admiral Stockdale’s story until Thursday.
I bring that up because I see a lot of varying opinions on when things are going to open for crowds and most of them vary from way too optimistic to completely absurd such as we will never have crowds again.
Baker Richards’, David Reece wrote a really nice piece this week about the various routes to recovery and it provides a really great way of approaching our thinking as we move towards whatever the future looks like.
My friend, Dorie Clark, put together a piece on resetting your goals in the face of tremendous uncertainty.
The reason I bring this whole concept up at the front this week is that I can say that personally I struggle with the uncertainty of the situation and I try to keep a very neutral approach to situations, neither too up nor too down. And, the pandemic has been a struggle for me.
The thing is that all of us have been impacted either catastrophically or just incredibly. No one that is reading this note today has had their business left unimpacted.
The way back isn’t clear either.
Dr. Fauci said that baseball might not want to play into the fall and that football may not happen in the fall.
Do I believe him?
I trust that he has dealt with public health issues his entire career and that two things are going to be driving what happens from now until we defeat the coronavirus: risk and new science.
Risk will be contextual and will change depending on the science, the situation, and a bunch of other factors. Like anywhere else, we are going to have to just keep an eye on things and make the best decisions we can based on the information at hand and the risk involved. I believe I shared a story about thinking through risks as things open up and the factors to consider. But the major point was that each situation we are going into will carry its own risk profile and we will have make decisions accordingly.
The second part of new science is pretty straightforward as well. With any new scientific discovery, the science and the facts change rapidly.
I’m sure with this virus likely by the hour.
This means that whatever any scientist or source tells us today is likely to be different tomorrow because the knowledge base is too shallow for us to really know exactly what is or isn’t correct in the long-run.
So keep an eye on both of these and allow judgment to be your friend because none of us really know what is going to happen between now and the end of the pandemic, but to paraphrase Jim Collins, “we must operate under the knowledge that this will end while also dealing with the brutal realities on the ground.”
Or, as Simon said he is telling the Booking Protect team, “Control the Controllable.”
Well, aren’t we all?
A few weeks back we discussed the in-depth article that called the merger something along the lines of the worst deal ever.
In light of the pandemic, the shutdown, and the lack of real information around when events will reopen to crowds and how that process will work, this deal probably is even more interesting to folks than it was before the pandemic.
Let’s think through three reasons that this deal carries additional weight and attention now:
First, Viagogo and the secondary market have not always been well-received by the average consumer in the UK and many other places around the world.
If you aren’t familiar with Viagogo’s practices in the UK, they’ve been ducking the government for years while the media has been recounting many instances where tickets were denied at the door, tickets weren’t received, or the terms and conditions weren’t properly disclosed.
So, the idea that the government of the UK was going to just wave through the merger because the States had given approval was unlikely.
Now that the government has a position of strength over this deal, how will they push Viagogo into compliance with the UK’s rules and regulations? And, what will they do to ensure that the behavior of the combined entity meets their expectations?
Two, the ongoing refund and cancellation challenges around the coronavirus.
Early in the pandemic, StubHub was taking the bulk of the heat for their response to the coronavirus and the postponement, rescheduling, and cancellation of events all over America and their response to these events. This wasn’t just a StubHub problem but a challenge that the entire industryhas been dealing with in different ways and forms.
While they’ve updated their policies a number of times, not much really seems to be resolved because we still see claims on social media that fans aren’t receiving refunds even in states that require refunds by law.
As the pandemic continues to march forward and we gain some direction on what events might happen when; what events will be rescheduled or changed; and how makes it to the other side of the pandemic still in business, the state of the merger will be more and more interesting to keep an eye on…because who knows what outs are in the deal or how the financing mechanisms are set up, eventually putting the shoe back on liability and who is left holding the bill.
Because like a lot of this…we just don’t know.
Third, this deal and the impact of the coronavirus is a window into the secondary market, the ticket market, and the business of entertainment.
We’ve learned a lot over the last few months including that these businesses were revenue rich and cash poor, debt-fueled a lot of these businesses, and your partners matter because the terms and conditions of your relationship can be changed with little or no warning.
As this story continues to play out and the entire ecosystem works towards whatever becomes the reopening of events with tickets, how the entire ecosystem recovers will tell us a lot about what the next decade of the industry looks like.
I’m still thinking about what I think here, but here are a few questions I’m thinking about:
* What shape will the secondary market take on the other side of this? Because it most certainly isn’t going to go back to the way it was before the pandemic.
* What will be the ripple effect of the postponements, cancellations, and rescheduled events?
* What percentage of organizations will take the approach of trying to return to business as usual when they were already struggling with attendance, sales, and marketing?
I feel a little bit like Charlie Brown trying to kick the football that Lucy is holding when I write about baseball and holding a 2020 season.
The latest proposal is for 70 games. At a certain point, we are going to run out of time to hold a baseball season.
The owners and the players have a long history of strife and it seems that the owners feel like they are in a much stronger position than they may actually be.
Sure, MLB has a new TV deal with TBS with growing TV rights. But we’ve also learned a lot about the business of the game since the start of the pandemic with the Cubs saying that 70% of their revenue comes from having fans in the stadium for games and most of the teams seeming to clock in around 35-40%.
What does this mean?
The sport needs fans and not just eyeballs because fans in the building are super important and baseball has been declining for several years and the average fan’s age has been steadily climbing.
I’ve written a lot here about baseball recently and I’ve been pretty consistent that there is just too much to be gained and to lose by not getting a deal done…but will it happen? I just don’t know.
Am I ahead of the curve or what?
I’ve been mentioning how great the AFL is for months now and how my team, Melbourne FC, rocks…now you’ll get to see that the AFL rocks and Melbourne is struggling, but let’s forget about the last part.
The last few weeks have been pretty positive for sport in Australia as their Prime Minister also announced that up to 10,000 fans could be in the stands in the next few weeks.
While the business of sports in Australia has been hit especially hard, the NRL has managed to stabilize its operations, the A-League is set to return, and organizations and partners are planning for the future.
What can we learn from Australian sport business right now?
In general, a lot because they are some of the most innovative and creative folks in the world due to the saturation of their markets.
In this context, we should recognize the need to innovate no matter what the circumstances, the importance of planning and project management to succeed in dealing with the coronavirus’s fallout, and sometimes opportunities come because you are prepared and in the right place. (Not that I’m discounting hard work for luck, but the harder I work…the luckier I get. And, sometimes you just get lucky!)
The festival business is tough and I’ve been involved in festivals where some of the headliners haven’t just not promoted or helped sell tickets…they have actively taken actions that would hurt ticket sales and we would have no recourse.
Like everything that is happening now, there are going to be a lot of unintended consequences to this. Likely, it will be two years before we really know what they are.
I do think it is important to see how artists react and whether this pushes more artists to go to international markets more regularly where Live Nation may not have as strong of a hold on a market.
We will see.
What am I up to this week?
New podcast posted this week with me being interviewed by Eric Fuller for his first Rescue Meet event.
I have a couple of new articles going up exclusively on the We Will Recoverwebsite next week on recovery and the “new normal”.
Also, I’m going to be posting an exclusive post on the Booking Protect blog on lessons from the pandemic and WFH that can be applied after the pandemic.
I’m in DC this week! Duh! Where else might I be at this point?