How to Conduct a Market Study for a New Concert Venue or Music Festival (Part 2)
Los Angeles, California, May 24, 2016 (Newswire.com) - Welcome back to the Concert Experts How to Series. In Part 1 of this edition, we touched upon the key market issues that need to be addressed when considering whether to develop or acquire a new concert venue, music festival, or existing live entertainment property. In Part 2, we put some meat on the bones. As we noted in Part 1, many of the elements of general market studies and feasibility reports should be included and the following are more specific to concert venue development.
· Is the market generally robust in its live music offerings?
It is relatively easy to procure empirical data on this point by simply looking at local print and on-line ads and listening to the radio, surfing ticket sites and simply driving around town, etc.
· Are there any venues or events similar to the proposed project?
In our venue consulting, we explain to clients that there are typically two reasons to consider building a new venue or site in a market: the market is currently not served by this type of offering or current offerings are inadequate and you believe that you can do it better.
On one hand, the existence of other similar venues isn’t necessarily a good thing since you will have to potentially take inventory away from these established sites by proving to both consumers and artists that you have different or better offerings, a better location and/or building. And, at the very least, even if you are able to take the shows away, it may be at a higher price due to the competition over the same inventory of acts. On the other hand, the existence of similar venues that are successful does answer the question above about the viability of the market generally with respect to live music.
· Are there other types or sizes of music venues or events which are successful resulting in a clear gap within which your proposed venue would fit?
Typically artists work their way up (and down) different types and sizes of venues based upon demand and their ability to sell tickets. For example, it is not unusual for an artist to start with small clubs and work their way up through large clubs, small theaters, large theaters, small amphitheaters and performing art centers, small arenas, large amphitheaters and arenas, festivals, fairs and stadiums. Is it clear that one of these is missing?
· What about if there is a dearth of venues or events in the market or none at all? Why do you believe that you can build your location into a music destination that artists will play and fans will patronize?
This is a tough one. The risk profile of these types of projects is exceptionally high since beyond basic market statistics such as population and income, there is little to hang your hat on. In these situations, it will probably be necessary to do some market comparisons. This means taking a look at other nearby cities or towns which do have the venue type you are contemplating and comparing market statistics in order to determine if you can replicate their success. And just because the other city does well, that doesn’t mean that the region can support another venue just like it.
· And, finally, what does your consumer base think about a new venue or music event? How about the artist representatives and local promoters who you may seek to help book the venue?
We understand it is not always easy to get to the artist side of the business, but where there is a will…… And certainly your local promoters may have a point of view (recognizing if they are already involved in some of the other venues, they may play it down or capitalize on your idea).
There is more for sure, but if you find yourself not getting passed any of these key factors, you should become more circumspect and require solid answers before moving forward.
Friedman Entertainment Advisors are live entertainment consultants based in L.A. We collaborate with our clients to design and implement innovative, competitive strategies with respect to a wide range of matters related to the presentation of live entertainment across various platforms including music festival and concert venue consulting.
Source: Friedman Entertainment Advisors
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