The Business of Natural Festival Selection
Are festivals fading? No, they are just getting better. What we are seeing is natural selection where only the fittest survive. Only those who work hard, find their niche, and strive to make constant improvements maintain sales year after year. Hosting and sustaining a successful music festival requires more than just choosing the right location and selecting a killer line up. There is no denying that festivals have an impact on the country. From the idyllic popularization of the peace and love movement that Woodstock created to the billions of dollars that these multi day events pump into the localities that host them, music festivals have become intertwined to both the culture and economy of today’s world.
While Woodstock was one of the first notable festivals to take place, these types of events really did not gain popularity until the 2000s. In 2016 we saw both a peak in gross earnings as well an increasing amount of festivals call it quits. Festivals like Coachella have mastered the art of balancing an enticing lineup with plenty of fulfilling experiences, like innovative activations and top end food vendors, that keep attendees coming back year after year. Others like Bonnaroo have been adding and improving their offerings in order to bounce back after a dip in attendance. Rather than join the festival graveyard, like Sasquatch did this year after 17 long years, they adjusted their lineup, enhanced their camping experience, and brought on more brand activations to improve the overall experience for attendees and it worked. The past two years they have seen attendance levels on par with expectations.
The Rise of Festivals in the US
In 1969 one of the first notable music festival took place in the United States. Woodstock Music and Arts festival attracted over 400,000 people to Bethel, New York. For both the counterculture and the world of festivals this event was a momentous occasion. While it is famously known for being free, it was not always intended to be that way. A last minute change in venue caused the event organizers to be put in a tight spot. They did not have the time and budget to build both a stage and fencing. Fearing how the crowd would react to a festival without a stage, they decided that they did not need to fix the gaps in the fence. When people started arriving by the tens of thousands, those without tickets simply walked on in. The festival almost bankrupted the promoters, caused a major traffic jam in the town of Bethel, and many faced food shortages and poor sanitation throughout the weekend. From this perspective the event sounds like a failure. However, for years now, Woodstock has captured the hearts of many with its message of love and peace. The overall atmosphere of the event outshined what a disaster it was enough to make the promoters their money back through a documentary that came out in 1970 for which they owned the rights to.
Woodstock represents the countries love affair with the idyllic image of a music festival- carefree individuals in Bohemian attire coming together to celebrate music, love, and peace. These events have become so beloved to so many as a safe space for individuals from all walks of life to come together to celebrate life through music and dance. That is why today they have become so popular amongst a population seeking an escape from a sometimes bleak reality. However, it took a very long time since Woodstock in 1969 for the music festival business to attain the popularity it has today.
“Other than the Grateful Dead, noone made money doing music festivals on a large scale until about the early 2000s,” New Music Confab founder Dave Stewart tells Pollstar. “What happened with this generation? Because for 20 years no one would do that, no one would go get sticky, smelly, not have a shower for two days and pay $500 for the privilege.”
The tides began to turn in the early 2000s but things didn’t really start to take off until 2014. That was the year that 22 festivals charted on Pollstars’ Top 200 North American Concert Grosses. By 2016 everyone was paying big bucks for multi-day festivals including those that involved camping. That year, the Top 20 Festivals grossed $477.7 million, the highest amount to date. These numbers only include those events that report regularly. Some, like Bonnaroo, have not been included on the charts since 2014. Year over year the amount grossed has seen a general increase with a few spikes and dips here and there but nothing significant to indicate a complete burst. The 2017 number of 338 million is less than the previous year but still shows a steady growth overall. While 2016 was the highest grossing year, it was also the year that at least 23 festivals announced they were throwing in the towel. This included Tomorrowworld who folded after its production company, SFX Entertainment, filed for bankruptcy.
Then the following year the world saw the disaster known as Fyre Festival. The event, planned for Spring of 2017, was supposed to be one of the most luxurious festivals that money could buy. Set in the Bahamas, it promised elite accommodations and an over the top experience unparalleled to any other musical event. Unfortunately, when attendees arrived they were met with slightly less agreeable conditions. Things were so bad on the island that this year two of the attendees were awarded $5 million in damages. Not only was this a disaster for those who attempted to attend but the media had a field day, ripping apart the organizers and the festival business in general.
Today the festival landscape is dominated by a few heavy hitters like Coachella, Lollapalooza, and Bonnaroo. Many large events have found success in hosting multi-genre lineups and focusing on ancillary experiences. Bonnaroo, which used to focus more on the rock and jam band scene, has begun to add more hip-hop and electronic to its lineup, hosting The Weeknd as one of its headliners in 2017. While these major festivals have seemed to have figured out the formula, Coachella sells out every year within minutes, not all festivals are as fortunate. Just this year, FYF called it quits after 14 years of hosting the two day event in Los Angeles.
“I think it’s a combination of a lot of things,” says Kevin Lyman, the longtime promoter of the Warped Tour now in its final year tells Pollstar. “High ticket prices, the headliners not being what the traditional FYF audience was looking for and a huge plethora of festivals and other options for things to do in the area all culminated in not many people buying tickets.”
Why Festivals Fail
Choosing the right line up is important for two reasons. Selecting the right mix of headliners and new names on the rise not only attracts a large audience but can also help you balance your budget. While every event would love to book the biggest names of today, it is not always a wise decision to spend a large portion of your budget on the music alone. Some festivals have to end up cancelling before they even get to host the event due to ticket sales not being on par with their spend. Karoondinha, a new festival meant to take place in July of 2017 in Pennsylvania called off the event a month before it was supposed to happen.
Despite having popular headliners like Odesza, John Legend, Chance the Rapper, and The Roots, the event was not reaching target ticket sales and folded before it endured further costs. The festival organizers claim that they spent to much money on professional fees, marketing, site preparation, and a sponsorship team that did not deliver. Overall, their business plan and execution was not on par with demand
“I think what we’ve learned in all of this is that the key part of putting on a successful festival is having a sustainable business model, which we obviously didn’t have going into this,” Paul Rallis says to Billboard. “The way this was structured in terms of its scale and projections was not sustainable. Even for some festivals in their second or third year, it’s not sustainable. There’s an oversaturation of festivals all over the country, and it has been a hard year all around, especially for those trying to take a festival to market.”
Bonnaroo Bounces Back
Bonnaroo Music and Arts festival held in Manchester, Tennessee every June is one example of a festival that could have folded but did not. In 2016 it experienced a significant dip in ticket sales. At the height of the festivals popularity in 2011, the festival sold over 85,000 tickets. Then in 2016 that number went down to just under 46,000 which is a little more than half of its peak year and about 30,000 less than its ten year average of 73,000. While this major drop in attendance numbers would have been more than enough of a reason for an event organizer to close up shop, Bonnaroo bounced back in 2017. The event began focusing on attracting a younger audience and improving their camping experience in order to recover from its dip in attendance. In 2017 the debuted their new all electronic stage, “The Other”, along with an increase in dance music artist on the lineup. Artists like Chance the Rapper and The Weeknd also helped to bring in a new audience as well. Then in 2018 they focused on enhancing the general admission campgrounds to create a better overall experience for attendees.
“Bonnaroo has always been about community coming together, and we have been talking for years really about how do we enhance that experience for people camping in [general admission],” said Ashley Capps, founder of AC Entertainment, the Knoxville-based music and arts presenter that co-founded Bonnaroo with Superfly in 2002 told the Times Free Press.
This year all the campgrounds were divided up into pods which hosted a plaza with a different theme. For example, Plaza 9 was the Love Shack hosted by chef Tim Love who taught cooking classes and served up food. Plaza 7 was The Ville which displayed all things Nashville. The festival also brought LG on as a partner to set up the first ever festival laundromat. Festival goers could get their clothes washed for free, lounge in the air conditioning, and even trade their clothing in for some fresh vintage digs. These small improvements helped to retain a loyal audience for the event.
With so many festival folding, despite having years long runs, it is curious as to why certain festivals can remain while others don’t. Just this year Sasquatch announced that after 17 years it would not be returning next year. Having the full festival package that allows you to maintain an audience is the key to survive in the over saturated market. Coachella is a prime example why events must present a 360 festival experience to attendees in order to be successful. Having an amazing line up definitely helps with ticket sales but having multiple ancillary experiences ensures that a festival can retain its audience despite changes in musical preferences. From finding its niche as the premiere fashion runway for the festival season, it’s focus on hosting the latest and trendiest food vendors, larger than life artwork that is splashed across millions of social media profiles, and interactive and technologically innovative activations, Coachella has figured out what it takes to sell out two weekends every year. In fact, it sells out within in minutes of sales being open and resale tickets go for almost double during the first weekend.
Over the years, festivals have come and gone. In 2016, we saw the rise and fall of them as they grossed the highest amount to date. It was all the year that over 23 events decided that would not be returning again. Then the following year, the Fyre Festival disaster occured not lending much hope to the future of new festivals. Now, the industry is run by a few large events that have the formula figured out. Constructing a mixed lineup and ensuring that the event is well rounded with ancillary experiences has proven to be the right equation for maintaining a successful event.
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