Following the recent release of the Office of Fair Trading’s (OFT) report based on research conducted in the summer of 2004 on UK ticket agency practices, Arts Hub examines the ‘necessary evil’ of ticket agencies.
It is no secret, and no surprise, that tickets for an entertainment event (theatre, dance, pop or classical music etc.) purchased from a ticket agent will incur extra costs, ‘mark ups’, in addition to the actual ‘face value’ of the ticket. In October 2003, the consumer watchdog Which? spoke out in an article in which they pre-empted the OFT report. During their research they identified that several ticket agents – members of The Society of Ticket Agents and Retailers, (STAR) were in breach of their own code of practice, failing to be transparent in making the existence and amount of additional fees obvious and in clearly pointing out the small print of the terms and conditions. They found evidence of mark ups of as much as 28% on tickets. At that time, only Ticketmaster complied with the code every time in all of the ticket purchases made by Which? for its research.
Helen Parker, then editor of Which? remarked: “Paying a 28 per cent fee is equivalent to a family of four taking one of the agency staff along for free… and buying them a drink at the interval.”
Of those surveyed for the OFT report, a small but significant minority expressed dissatisfaction with their ticket purchase through an agency, many citing additional fees as the reason. They either don’t like additional fees at all, don’t understand them or felt simply they were too high. It is important to have an understanding of why promoters and venues use ticket agencies in order to take a balanced view. As consumers we find it highly irritating to find our already pricey event tickets marked up by as much as 28%, however, use of ticket agents does enable easier access to the tickets for the consumer who is unable to get to the venue box office in person, and assists the event promoters in distributing tickets more efficiently and more effectively through economies of scale. Agents can service several events/promoters at one time and are able to spread their costs, whilst providing the 24-hour service demanded by the consumer. They can also update necessary equipment and software more cost effectively than most individual venues can.
That said, it doesn’t explain why the face value mark up varies by such a high degree between agents (and even, by some anecdotal accounts, within agencies for the same tickets!) Research conducted by OFT for their recent report, showed that tickets to see the West End show, CHICAGO with a face value of £42.50 varied in their final prices from £45.25 to £53.50 as a result of differing agent fees, (the highest priced ticket represents a mark up of 26%, the STAR code of practice itself recommends no more than 25%).
Ticket agencies generally make their revenue from the ‘booking fee’ but in some cases they also receive a small percentage – around 4%, of the ticket’s face value as part of their deal with the event/promoter, known as an ‘inside fee’. An additional processing fee is often levied, known by many guises; this can cover postage cost, printing and other random and usually unspecified ‘expenses’. In spite of the frustratingly arbitrary nature of these ‘no upper limit’ additional fees and the shocking disparity in amounts between agents, the inquiry could find no evidence of unfair competition among official “primary” ticket agents and makes no recommendations for capping these fees.
In a recent Whatsonstage.com discussion board, two disgruntled ticket purchasers illustrated the consumer feeling to this stranglehold of ticket agent fees as they wryly swapped theories on the meaning of additional fees:
Question: OK Phil can YOU tell me, what is the difference between a “processing fee” (as explained thanks) and a “service charge”? Having been charged a £2.50 “processing fee” for a £20 Acorn Antiques ticket AND a £3.50 “service fee” for the same ticket what is the “service charge” for?
Answer: The smile they produce when depositing the tickets in the envelope.
It’s a glib yet heartfelt expression of the impotent frustrations we feel when being forced to pay fees that we cannot see a reason for. It seems that nothing much has changed in the world of ticket agents since the 2002 Which? report and agents continue to flout their own code of practice, and on occasion evidence of law-breaking has been found by the OFT. The problems identified by Which? are backed up and expanded upon in the more recent OFT report. As well as pricing, another major concern is clarity of information in the small print of contracts. Where they bother to inform the consumer at all, there is a lack of consistency between agents on consumer rights, conditions of sale and what course of action for consumers to take if things go wrong with their purchase.
In spite of the CHICAGO example showing us that prices can vary greatly between agents, the report revealed that as few as 6% of people purchasing tickets for an event, bothered to shop around for the best deal when they are buying from ticket agencies. 94% of consumers bought from the first ticket seller they contacted and half were unaware that it was possible to buy from more than one agent or even direct from the venue box office. This could be due to lack of information in event advertising or simply consumer laziness, but the OFT recommends that different sales channels should be made clear in advertising.
A principal concern of OFT was the availability of clear pricing information in print advertising. Problems have arisen due to well-meaning legislation that placed an obligation on events and promoters not to mislead consumers in the displaying of pricing information. Previously they were advertising the face value with the added caveat of ‘booking fees may apply’. This was challenged following an instance of the booking fee caution being omitted and now the following applies:
‘Face value prices may be quoted in marketing communications only if no extra charges apply when buying tickets through any of the sales channels. Therefore, where face value prices are stated, all additional fees must also be quoted in full’.
This would make for some cumbersome and expensive advertising so many are opting to omit all pricing information in print advertising, and consumers are forced to make a purchasing decision, unaware of the face value of tickets and of the existence of additional fees until several minutes into a phone call with the ticket agent. The OFT feels that this needs to be addressed with changes to the current advertising guidelines such that pricing is, once again, made clear in the advertising.
These issues relate for the most part to the primary ticket agents, that is; those agents that have a direct contract and relationship with the venue/promoter to sell tickets for their entertainment, either exclusively or in tandem with other agents. The rather less scrupulous ‘secondary’ agents re-sell tickets that have already been sold at the original point of sale. Not all of them are deserving of the derogatory moniker, ‘tout’ but they have gained notoriety for marking up prices by as much as several hundred percent, particularly for rock/pop concerts. Many have been found to be in breach of legal guidelines notably by not making the face value of a ticket clear to the consumer at the point of sale and selling it on for a grossly inflated price. In addition evidence has been gathered of agents misleading consumers as to the quality of the ticket for sale where there is a range of seating options and the most common complaint of all, late or non-delivery of tickets.
Venues and promoters are increasingly using agents to sell tickets so it seems that, like it or not, ticket agents and their booking fees will be with us for a long time. Legislation, trade guidelines and OFT recommendations may help to encourage better practice, but it is incumbent upon us all to take responsibility for our actions and where possible to shop around for best prices. Buy direct in cash from venue box offices in person wherever you can because that rarely incurs a booking fee and demand transparency of information from ticket agencies where you are forced to use them.
Sources and further reading at:
www.oft.gov.uk
http://www.s-t-a-r.org.uk
www.officiallondontheatre.co.uk
www.which.net
www.whatsonstage.com
