This piece was originally written as part of the “Pricing Strategy and Tactics” elective at London Business School. It is presented here with minimal edits, as an example of how I approach applied economic analysis in real-world cultural contexts.
The module was delivered as a block-week by Prof. Oded Koenigsberg.
EDIT 2/2/2026: in the wake of Harry Styles’ 2026 tour tickets sale, this article is more timely than ever!
1 Introduction
On the evening of November 4th, in a quiet town in Kent, an effigy representing Ticketmaster was burnt in occasion of the traditional Bonfire Night.[1] Ticketmaster wasn’t immolated alone: representations of Liam and Noel Gallagher were also consigned to the flames. What could the rock brothers and the world’s biggest ticketing organisation have done to deserve joining illustrious predecessors such as Mayor Sadiq Khan, Liz Truss, and even Donald Trump? The answer lies in an approach taken more and more frequently by ticketing agencies like Ticketmaster, and brought to the absolute forefront of the UK’s public opinion when the Oasis reunion tour’s tickets went on sale here: dynamic pricing. This system, already widely used in the US, dynamically adjusts the price of tickets in response to changes in demand – pretty much instantaneously, and across all ticket categories. With Noel and Liam Gallagher playing together as Oasis for the first time in 16 years, Ticketmaster was expected to manage the biggest concert launch the UK had ever seen, and felt the time was ripe to finally roll out dynamic pricing at full scale on our side of the Atlantic.
2 The infamous day
On the morning of Saturday the 31st of August, ten million people from 158 countries tried to buy a ticket for one of Oasis’ 17 shows.[2] In and of itself, this was hardly surprising. Personally, I followed my usual routine, optimised over 20 years of avid and regular concert going. I had an alarm set to remind me to log in in to Ticketmaster about half an hour before launch, ready to join a likely long queue to get a couple of tickets for one of their Wembley shows. I had two Ticketmaster instances open, one on my phone, and one on my laptop. The latter was immediately shut down under suspicion that I was a bot. [Bots are setup to buy tickets automatically by professional touts. Such tickets are then immediately made available on secondary markets.] Still half asleep (it was a gorgeous Saturday of summer annual leave back home in Italy), I looked at my phone. I wondered whether it had gone crazy, or whether I was still in the middle of a nightmare: I was in position 520,162 in the queue (Figure 1).
Figure 1: A view shared by many fans on August 31st.
I thought there would be absolutely zero chance to get the tickets, and decided to go about the rest of my day After five hours or so, I received a notification on my phone: I was finally at the top of the queue! I entered the metaphorical “foyer” and could finally look into grabbing some GeneralAdmission (GA) tickets, as I wanted to be right in the middle of the crowd to savor the fullest experience. Or so I thought: tickets that would normally be £120 or so each, were priced dynamically at £540. I do like Oasis and I did listen to them plenty during my teenage years, but I don’t like them that much. I shut down Ticketmaster and forgot about it. Clearly, plenty of other people did not feel the same way as I did, and all 1.7m available tickets sold out in less than ten hours.
3 The pricing paradox
GA tickets are typically standing tickets with no assignment to a specific place or seat. They are usually priced slightly above seated tickets that are further away, but less than premium seats closer to the stage or perhaps bundled with services such as hospitality, sound-check entrance, and so on. Historically, GA tickets have always had one predictable pricing tag, one that does not change from venue to venue, or city to city. For small acts and venues, around £30. For larger bands and stadiums, as much as £150. GA tickets’ democratic nature means that hardcore fans who want to be as close as possible to the stage have no choice but to get to the venue earlier than anyone else, and race their way to the front. Plenty of times, fans have even camped outside the venue as early as the night before, to secure a front-row position. Why can the price to access a large field with an unspecified position vary by such a huge amount, even when customers are buying all at the same time, with no particular “last minute” urgency, no certainty of having additional benefits, or even any reassurance of being at the front of the crowd?
4 Price discrimination in the performing arts
The practice of price discrimination in the performing arts has a long history.[3,4] It is rooted in the intention to improve accessibility to events for the widest possible audience, without compromising the possibility of maximising revenue. Theatres and performance venues alike have deployed tiered pricing models, in which different prices were charged depending upon variables such as seat location and visibility. [Once, I paid half price for a show at the famous Ronnie Scott’s club in London because my seat was behind a pillar, with extremely limited visibility of the stage.] This type of practice dates back as far as the times of ancient Roman theaters, where seating varied by social status; premium positions were, of course, reserved for elite citizens. As recently as the 19th century, with theatre-going acquiring popularity amongst broader segments of society, promoters segmented the market and price-discriminated to cater to different income levels. This is thought to have resulted in increased attendance and optimised ticket sales.
With modern advancements in ticketing technology, and the more developed understanding of performing arts as experience goods, price discrimination has become more and more sophisticated. Complex pricing strategies, often associated with bundling of other services (e.g. pre-show meet & greet with the band, early access to sound-check, larger seats, aisle seats, commemorative merchandise, etc) are now incredibly common, especially in large venues where the infrastructure to support such diversification exists. When it comes to watching my own favourite bands, I make sure to snatch aisle places (which are more expensive) so I can stand comfortably in the corridor; if it’s a few of us going, we often look at some “hospitality bundles” with added food and drinks.
Customers often complain about the increase in prices, but rarely do they mention that in this finer and finer level of discrimination rules are clear, prices are transparent, and the options are there should one wish to exercise them. If one can afford to spend a larger sum, she can look at the extra packages. Otherwise, one must purely make sure to be quick off the mark when tickets are released, to snatch the “baseline” tickets before they sell out.
Was this universal rule broken in Oasis’ case?
5 Comparison with Initial Public Offerings (IPOs) and stock
When dynamic pricing came to the forefront of the general public’s attention, it was also in the context of its influence on secondary markets behaviours. I immediately wondered whether an analogy could be drawn with IPOs and the subsequent stock trading on the secondary market. An IPO is the process by which a private company becomes publicly traded by offering shares to the general public for the first time. This process involves several stages, with one of the most crucial being the price-setting phase; this is often managed by investment banks. They help with determining the initial offering price, trying to balance the goals of maximising the raised capital and being attractive to both institutional and retail investors. Obviously, this revolves heavily around the company’s financials, market position, and prevailing market conditions.
In stock terms, the primary market refers to how shares from the company are sold initially to investors during the IPO. The company eventually receives capital and the investors eventually receive shares; the investment banks act as intermediaries, buying shares from the firm at a discount, and selling them to the investors at the offering price. Investment banks profit from the spread between the two prices.
At the end of the IPO, shares are then moved to the secondary market, freely bought and sold on public exchanges. From this point onwards, as the issuing company no longer participates in subsequent trades, any price appreciation benefits the investor(s) who bought in on the primary market or subsequent shareholders.
If a company’s share price surges immediately after the IPO, it may be that the stock was underpriced during the primary market sale, and that the company could have possibly raised substantially more capital. Does this sound familiar?
6 Primary and secondary markets in performing arts
Just like IPOs, ticket sales for high-demand performing arts events face challenges related to pricing and demand. Tickets are sold at a fixed price (traditionally), which is set by the promoter or the venue before launch, aiming to sell out while ensuring revenue maximisation.
What happens when fans can’t buy tickets as soon as they are issued? If the show does not sell out, purchases can happen later on, possibly even at the venue’s box office on the day of the show. If the show does sell out, there are a number of marketplaces where fans can still buy tickets resold by fellow fans who can no longer go, or professional touts, who buy up tickets for an event to resell them at a profit.
In a way, promoters or venues act like investment banks. The artists are akin to the company approaching the float, with the tickets being sold like shares on the primary market first, and eventually being freely traded on the secondary market afterwards.
Therefore, a static approach to pricing can lead to “leaving money on the table” if demand surges beyond expectations, as professional ticket touts step in to exploit the arbitrage opportunity and profit from the discrepancy. This situation is similar to IPOs where underpricing can allow early investors to benefit from an immediate price surge in the secondary market (although arguably this may be much less deliberate than touts’ approach).
Platforms like Viagogo and Stubhub provide secondary market services. I have used them both on the supply side (selling tickets I no longer needed) and the customer side (when I finally had certainty I could make it to a show that had sold out by then). In these marketplaces, the original event organisers do not benefit from the additional value captured by resellers, much like how firms miss out on gains from a post-IPO price jump. The high resale prices signal that tickets were likely underpriced initially, leading to the same “money left on the table” scenario.
Indeed, in the vast majority of cases, prices are substantially higher than the ticket’s face value, on secondary marketplaces. Moreover, such platforms charge fees as high as 30% of the transacted value, showing high willingness to pay among a segment of consumers. All things considered, they are seen as a “necessary evil” by concert goers, who are given a second chance to try and see their idols, or the opportunity to recover the money they spent on tickets that would be otherwise wasted if they can no longer attend.
7 The viewpoint of the suppliers
Clearly, though, promoters and primary ticketing agencies do not look so favourably at secondary marketplaces, and have looked into dynamic pricing to increase their own extraction of the consumer surplus. Dynamic pricing effectively mirrors the investment bank’s role in assessing demand for IPO shares through roadshows, and in adjusting prices based on market signals before going public. By doing so, primary ticket sellers gain a share of the market-driven premium, similar to how firms could benefit from adjusting IPO prices to reflect true demand. A key difference is, of course, that the algorithms involved in the performing arts’ dynamic pricing act almost instantaneously and are fully autonomous.
Live Nation Entertainment, Inc. (Live Nation) is one of the biggest entertainment companies, promoting, operating, and managing ticket sales for live entertainment internationally. It has a market cap of $28b. They believe that dynamic pricing curbs the power of ticket touts by raising prices and squeezing the tout’s own ability to make money. There is statistically significant evidence supporting this claim:[5] Figure 2 shows the results of an analysis carried out by the Financial Times on this matter, in the aftermath of a decision by the producers of Hamilton (a world-famous musical show) to increase the price of their best tickets to $849.
(a)
(b)
(c)
(d)
Figure 2: Study of the secondary ticket markets captured in Kao and Nicolaou[5]
Hamilton was experiencing a huge amount of demand for seats around that time, and the producers thought a price increase on the primary market would be an effective measure to erode ticket touts’ margins, even if the face value of such tickets remained substantially below the prices seen on secondary markets. How did the producer come up with the $849 figure? By monitoring the secondary markets, and calculating the average ticket price on such markets. Figure 2a shows how the number of listings per performance on Stubhub nearly halved after the producers’ move. Figure 2b shows how, irrespective of the new face value price, the average Stubhub ticket price did not change. Figure 2c shows how Stubhub’s margin fell by $169 per ticket, on average. Finally, Figure 2d compares three metropolises and their price ranges. New York offers the broader price discrimination, but the cheapest ticket is, luckily for us, here in London.
As we know from Bertini and Koenigsberg[6]: “with any price increases, companies should give customers compelling reasons to focus on value, not price.” Promoters have been trying to gain control of the narrative using whatever possible means. Live Nation, in one of their most recent blog posts,[7] has argued for a baseline increase in face value prices. They claim that with concerts becoming “experience goods”, the associated customer value has been increasing for decades. [Of course, we must also accept that the cost of production has increased dramatically, if we notice the evolution of live shows since their inception.]
Secondly, Live Nation also leverages the long-standing relationship between artists and fans to justify dynamic pricing. In particular, they argue that artists rarely act as textbook profit-maximising entrepreneurs. Rather, as they see a higher meaning in their work, they have tried to make their music (and live shows) accessible to the widest possible audience. This sounds like a social pact between artists and audiences that bypasses the usual reliance on supply and demand dynamics. However, none of these “rules” stand in the court of secondary markets. Of course, producers and promoters like Live Nation do claim to have the interests of the artists at heart. They state that most of the money collected from ticket sales (as much as 90% of it) is divided between the artists and the promoters; and that artists do lose out when they cannot make any claim on the 10x prices seen on platforms such as Stubhub.[8] Therefore, by applying dynamic pricing, they are helping the artists as well as themselves.
There are also other reasons specific to the music industry that would justify such a degree of dynamic pricing: the show travels from city to city (and therefore touches demographics that can be wildly different), not all venues provide the same experience, and not all seats provide the same aural or visual enjoyment. In a way, delegating the authority on pricing to an algorithm acting instantaneously can somewhat reduce the human work upfront.
Nevertheless, there are acts that are opposed to such a system. Typically, such contrarian views come from smaller, independent bands; but even artists as big as The Cure have pledged to minimise price discrimination with no platinum packages or dynamically priced tickets available for their recent US tour.[8]
Finally, we should not forget how artists have become more and more dependent on touring-related income, especially since the advent of online streaming. This shift in consumer behaviour has undermined the value of recorded music and therefore drastically lowered record sales. This means that touring could no longer be a loss-making venture, borne purely to support album sales. Consumers have to be squeezed as much as possible.[7]
8 The viewpoint of the customers
By scouting fans’ websites and forums, and reading the comments section of the many articles published immediately after Oasis’ tickets were released and quickly sold out, the verdict seems unanimous: it was an incredibly poor process. Some fans noted the difference between buying tickets and, for example, flights, with everyone trying to buy concert tickets literally at the same time. Normally, in other industries the expectation has always been that price is lower at the beginning, and then would then go up as urgency becomes more material closer to the point of consumption. Of course, last minute deals are also expected and normalised. Technical glitches were also noted, with plenty of customers being kicked-out of the queue under suspicion that they were bots trying to buy tickets automatically to feed the secondary market. However, the biggest complaint was towards Ticketmaster leveraging a presumed position of monopoly (see Section 9 and Section 10), with the most disgruntled customers taking it as far as saying that “buying concert, plane, train or any other ticket is now like trading stocks in a highly volatile market. Just another example of capitalism gone mad.” [9]
Crucially, customers lamented the absolute lack of transparency around dynamic pricing: the very fact that it could be done in the first place (ethically and legally), but also that it would be introduced unannounced for Oasis’ reunion.[8]
Some customers pointed out that dynamic pricing works in favour of real fans, speculating that £100 tickets are so affordable that anyone would be willing to go. Therefore real fans may miss out purely because of purchase timing, technical glitches, etc. They argued that with tickets priced dynamically as high as £500, though, only real fans would be willing to go. This process of “natural selection” however hinges on several assumptions that may not necessarily hold true, or presupposes some degree of market efficiency that excludes secondary markets, etc. Recurring to some reductio ad absurdum, are the “real” Oasis fans also asymptotically infinitely wealthy? I don’t believe so.
Finally, humans do suffer from the sunk cost fallacy. As pointed out by Jean-Pierre Dubé of theUniversity of Chicago Booth School of Business, once a customer has been in the queue for five, six hours, the feeling of having invested time and effort into the process makes the temptation to buy irresistible.[8]
In any case, with the tour selling out so rapidly, one can argue that the system worked well; or that, in fact, there could have been room for even more aggressive dynamic pricing practices and higher prices. The concern is that, having worked for such a popular event like Oasis’ reunion, the practice has now been fully normalised.[8]
9 The viewpoint of the regulators
The public uproar has definitely attracted the attention of the UK competition watchdog, which has begun an investigation into Ticketmaster, concerned that consumer protection laws might have been broken.[8] Moreover, the UK government announced a wider review of ticket pricing, joining the US Department of Justice, which in May launched an antitrust investigation into Live Nation. The EU is not standing still either and has also placed Ticketmaster under scrutiny.[8,10]
What are the main concerns raised? Firstly, that businesses may not have been sufficiently fair and transparent in giving accurate information on the price consumers have to pay. Secondly, that they have been able to do so because of a monopolistic position. A firm is considered “dominant” if it has a market share of 40% or more, persistently.[10] If we look back at 2010 when Ticketmaster and Live Nation merged, a market share of 40% to 50% (in the UK) was estimated.[10]
Are players like Live Nation abusing their position and power?
10 The structure of the music industry
Oasis claimed they did not know that dynamic pricing would be used, stating that all pricing decisions were in the hands of promoters and management. Ticketmaster stated that they did not set pricing policies either – the artist and promoters did. It sounds like a game of shifting the blame, which perhaps warrants a deeper look at the relationships between the stakeholders within the music world.
There are three promoters for Oasis’ tour: SJM Concerts, DF Concerts, and MCD Promotions. SJM is owned by Mr Simon Moran, and is one of the largest concert promoters in the UK; it also runs gigsandtours.com, which happens to be one of the official ticket sellers for the Oasis tour. Incidentally, SJM has a joint venture with a Live Nation subsidiary; moreover, Mr Moran and/or SJM and shareholders or directors in more than 10 other Live Nation subsidiaries. These include DF Concerts, where Mr Moran owns approximately 20% of the shares, and Live Nation 80%. Finally, MCD Promotions is also wholly owned by Live Nation.[10]
It does not stop here. Live Nation has stakes in merchandising companies, too, including for example De-Lux Merchandising, one of the biggest players in this space. Security-wise, Live Nation also owns Showsec, which has handled security at more or less every venue I’ve been to in the last few years.
Venue-wise, Live Nation has a stake in Academy Music Group, which operates venues across the UK such as O2 Academy Brixton, O2 Sheperds Bush, the O2 Academy Glasgow, and Cardiff Arena.
In terms of artists management, Live Nation’s Artist Nation provides global touring deals, festival performances, and artist management services.
Finally, Live Nation owns and runs a lot of major festivals both in the UK and globally: Creamfields, Parklife, the Great Escape, Boomtown, Reading and Leeds, Wireless, Latitude, and many others.
In summary, Live Nation has some degree of connection, and possibly dominance, with every aspect of the music industry value chain. If we consider that Ticketmaster accounted for at least 70% of all revenues associated with all tickets sold at large US arenas and stadiums in 2022,[8] we should expect, or possibly welcome, a much closer look from the regulators.
11 Similar markets and defining characteristics
We can look outside the music industry to find other markets that face similar challenges and dynamics, in particular regarding how initial pricing decisions may impact who eventually captures the value, and whether participants in secondary markets can profit from arbitrage.
Sports event tickets: just like concerts, sports tickets attract high demand and a significant activity on the secondary market. Sports leagues are using dynamic pricing models increasingly to adjust ticket prices in real-time, based on demand, to try and reduce the profitability of ticket resellers. Advanced technologies such as ephemeral QR codes are also being deployed.
- Hotel and airline bookings: these industries have been using dynamic pricing to adjust rates based on occupancy levels, booking windows, and demand surges, to keep revenues within the primary markets while reducing the benefit for third-party resellers or travel agencies.
- Luxury goods and limited-edition items: objects like sneakers, designer bags, etc. often sell out at their initial retail price, only to resell at substantially higher prices on secondary markets. Some brands have been experimenting with dynamic pricing on release days, or with offering a limited number of exclusive items through lotteries, or even with releasing slightly differentiated reissues to balance demand and supply. Companies like Ferrari or Rolex struggle to manage this. They are so exclusive in the selection of their customers, with incredibly long waiting times, that second-hand products are often more expensive than brand-new ones.
- Real estate market (new developments): fixed pre-sale pricing can lead to a quick price appreciation post-sale, which benefits initial buyers over developers. Some developers have been phasing the release of units, or have been using auctions to capture higher prices when demand is also higher.
- Collectibles and art auctions: fine art, collectible cars, and other high- or ultra-high value collectibles often go to auction. When items are sold at fixed prices, we often witness the emergence of a secondary market, where early buyers may profit significantly.
- Software and video games (especially limited editions): developers are increasingly adopting dynamic pricing for downloadable content, seasonal passes, and pre-orders to meet demand at various price points.
We can identify several defining characteristics of demand, supply, and market conditions that could lead to similar scenarios:
- High willingness to pay among a segment of consumers
- Emotional or status-driven purchasing behavior
- Perceived exclusivity or scarcity
- High demand with limited supply
- Time-sensitive or perishable items
- Unpredictable or surging popularity
- Low transaction costs in the secondary market
- Transparent and accessible secondary markets
12 The aftermath
Oasis announced two more dates at Wembley stadium. Only fans that were in those queues at launch were invited to participate in a staggered, special ballot for the 180,000 tickets available for the two new dates, with no dynamic pricing deployed. Therefore, prices were around £150 for GA, while standard seated tickets would range from £73 to about £205.[11]
Having been in the queue for hours on Saturday the 31st of August, I was eligible for the ballot, but did not win access to the sale.
13 Conclusions
I believe that my analysis of Ticketmaster’s dynamic pricing as rolled out for Oasis’ reunion reveals a significant shift in the relationship between consumer expectations and ticket pricing strategies. This event has shown how traditional, transparent pricing structures in the performing arts are being replaced by aggressive, algorithm-driven approaches that prioritises revenue maximisation. In Oasis’ case, dynamic pricing removed any notion of price fairness or stability, thus transforming a highly-anticipated and emotionally-charged purchase into an opaque transaction and frustrating experience. The research work carried out to produce this assignment has made me question the very structure of an industry that I have supported very passionately for decades as an avid concert goer.
Dynamic pricing is a relatable example of the real-world application of economic theory; one that leverages principles such as demand elasticity and consumer surplus extraction. I argue that this system mirrors the dynamics of an IPO, where the initial, primary sale price may drastically shift based on public demand. However, in this case, the transition is automated and instantaneous, leaving little time for consumers to evaluate their own willingness to pay, charged as they are by emotions, and trapped by the sunk cost fallacy.
In my opinion, is clear that ticket promoters have taken cues from financial markets to create a model that actively engages in demand speculation. However, this model raises an ethical question: should companies be allowed to harness such powerful pricing mechanisms without transparency, especially when operating in what appears to be a quasi-monopolistic environment?
In conclusion, this assignment and the related research work have deepened my understanding of the implications of modern pricing practices within the entertainment sector, with their pros and cons. On the one hand, dynamic pricing can be a useful tool for artists and promoters to maximise their revenues while undermining secondary markets. On the other hand, the practice lacks transparency, and arguably any considerations for loyal fans, as well. I don’t believe that, in this case, the changes in price facilitate the relationship between company and customers; or that customers are left with any option to change their situation through their own actions.[6]
What is next? I believe there is room to strike a balance, one in which the promoters and ticketing agencies may combine dynamic pricing with structured guidelines to protect consumer interests, for example, some that include fanclub memberships to access early pre-sales without dynamic pricing. This would not only benefit the reputation of the performing arts industry, but also preserve its core mission: to bring audiences closer to the artists they love so much.
References
1. Molly Court. Ticketmaster and Oasis effigy burned at Edenbridge Bonfire, 2024. URL Accessed 9th November 2024.
2. Andrew Macaskill. Oasis tickets sell out after technical problems frustrate fans, 2024. URL Accessed 9th November 2024.
3. Pascal Courty and Mario Pagliero. Chapter 13 – the pricing of art and the art of pricing: Pricing styles in the concert industry. In Victor A. Ginsburgh and David Throsby, editors, Handbook of the Economics of Art and Culture, volume 2 of Handbook of the Economics of Art and Culture, pages 299–356. Elsevier, 2014. doi: https://doi.org/10.1016/B978-0-444-53776-8.00013-1. URL
4. Bruce A. Seaman and David Green. Price discrimination in the arts: a cross-sectional analysis. In Southern Economic Association Meetings, Orlando, 1994.
5. Joanna S Kao and Anna Nicolaou. ‘Hamilton’ raises Broadway ticket prices to foil scalpers, 2017. URL Accessed 9th November 2024.
6. Marco Bertini and Oded Koenigsberg. Dynamic pricing doesn’t have to alienate your customers. Harvard Business Review, 2024.
7. Dan Wall. The truth about ticket pricing, 2024. URL Accessed 9th November 2024.
8. Daniel Thomas, Eri Sugiura, and Anna Nicolaou. Will Oasis backlash force a reckoning for the ticket industry?, 2024. URL Accessed 9th November 2024.
9. Suzi Rin and Daniel Thomas. Ticketmaster’s sale of Oasis tickets probed by UK competition watchdog, 2024. URL Accessed 9th November 2024.
10. Chi Chi Izundu and James Stewart. Oasis ticket row: How Ticketmaster’s owner has grip on UK live music scene, 2024. URL Accessed 9th November 2024.
11. Mark Sweney. Oasis and Ticketmaster urged to refund fans after ‘dynamic pricing’ debacle, 2024. URL Accessed 9th November 2024.
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