StubHub Partners with AudienceView
New primary distribution agreement is about inventory, event discovery and easy access
- by Linda Deckard
- Published: December 17, 2014
StubHub has partnered with AudienceView to serve as a distribution channel for primary ticketed events. The agreement represents expanded inventory in music and arts and better customer service for StubHub. It means more volume, event discovery and access for AudienceView client venues.
AudienceView, which powers e-commerce and ticketing for both large entertainment organizations and self-serve events management portals that can be used for experiences of any size or type, will integrate its solution with the StubHub platform. The integration is designed to provide seamless, real-time inventory management so that AudienceView clients may better utilize StubHub as a distribution channel for their events.
AudienceView provides a full e-commerce and ticketing solution for more than 550 venues, representing 100,000+ live events annually in the United States, Canada, United Kingdom and beyond. The event categories presented by AudienceView clients range from theater, performing arts and film to music, professional sports and college athletics.
“We put our clients first,” said Mark Fowlie, CEO, AudienceView, in explaining the motivation for this deal. “For us it’s about bringing the best possible distribution to our customers to allow them to move inventory and get access to patrons and fans who want access to their events. We’re a global company and there are regional differences, but there is a common theme – fill the house, get customers in seats and drive more revenue.”
StubHub has done a great job of becoming a portal of choice for event discovery, Fowlie continued. “By no means are we replacing our customers’ websites and mobile apps and other avenues and channels to market, but event discovery is taking on a high importance. From a consumer point of view, I need to know where to go to find out what would be interesting to me, to curate events. Our customers want that, but not if it’s disruptive to their business or brand identity. They need to build that data-centric view of their customer, to know who is sitting in that seat at the end of the day.”
To that end, AudienceView customers who opt into the StubHub distribution channel will receive that data.
Michael Katz, head of merchant services for StubHub, noted this partnership is different from deals StubHub has with Paciolan and AEG, which focus more on resale and use barcodes to cancel and reissue tickets. “The deal with AudienceView is strictly around inventory distribution. The main lever is working with them and their clients to distribute primary inventory, mainly focused around types of events and inventories we don’t have today. It opens up for us a broader distribution base for customers coming here anyway to look for this stuff. And it’s new eyeballs for AV’s customers, who will be selling more tickets.”
AudienceView clients have to opt in. StubHub and AudienceView will work together to make sure they understand the benefits of doing so.
Katz believes the partnership will really gain momentum after the first year. They will start with manual processes and work their way up to further automated solutions. “We’re working together now to build some pieces to make it easy,” Katz said. “While we’re doing that, we have tools now that buyers use to get inventory on StubHub and we will work with AudienceView to do that for their clients today.” The day when inventory lives on both sites and comes off on a real-time basis will probably come in mid-2015, Katz said.
AudienceView is looking for volume; StubHub is looking for product. This is essentially StubHub’s second distribution deal, the first being with Telecharge and the Shuberts for “Book of Mormon.”
“We are doing a lot of work around connecting fans and customers with the things they want to see,” Katz said, clarifying that it is all about primary distribution, not primary ticketing. The ultimate goal is to continue to be a world-class marketplace with the breadth and depth of inventory that fans want, he said. “The richer our event catalog is, the more search functionality we can provide to fans, the better we do and the more we satisfy consumers.”
“We talk about integration and API (Automatic Programming Interface), but it’s kind of like saying I need an engine when I want to get from point A to point B. You don’t need an API, you need distribution, to facilitate moving of tickets,” Fowlie said. “We don’t just give you the engine (API) and say you’re on your own to build the car. Our approach is to build a rules-based connector, a product tie-in integration. Once it’s in the product, every customer has the opportunity to light up that distribution channel.”
Obviously, each AudienceView client will apply this option based on their own business rules – inventory, limits and caps, onsales and offsales, he continued. “It’s primary inventory. Our customers will decide how that inventory is available.”
There are also technical rules, he added. “Think down the road, and maybe the distribution channel has a mobile app with 100,000 consumers. Somehow you have to manage that experience. If 100,000 consumers are all checking available inventory, the system has to support that. Technical rules have to manage load and how much data is going back and forth to make it a good, enjoyable experience for event discovery.”
Fowlie doesn’t expect all inventory to be available on all channels. That’s an individual business decision the clients make. “We focus on helping them drive more revenue, better consumer engagement and lower operating costs. We don’t have a direct impact on the product they put out. Their decision will be based on a number of business factors.”
The AudienceView customer is in full control of how many, what tickets and what pricepoints end up in the StubHub system. “We’re facilitating a distribution channel should they choose to use it. We think many will. Our goal is to provide a solution that gives them options,” Fowlie said.
AudienceView did its homework before making this decision. The biggest challenges are in countries like the U.K., where secondary providers have had “a bit of a rough go,” Fowlie said. “We wanted to make sure we could emphasize this is not about scalpers. This is about primary distribution. They are interested in moving primary tickets providing they have the control and can understand who is coming into our venue and can have the data to do followup marketing and customer engagement.”
The strategy is to build the integration, which will be done the first quarter of 2015. In parallel, AudienceView is exploring a semimanual way to integrate with StubHub in the short-term. Some clients may test the waters as early as January with an allocation model.
Either way, the AudienceView customer would get the information on the customer. “Our value proposition to our customers is an integrated solution that includes CRM [customer relationship management] as the core of the system. We weren’t interested in something that impaired the value of having every touch with that customer incorporated in that CRM core,” Fowlie said.
WHERE’S THE MONEY?
AudienceView “benefits when our customers are prosperous. If they can move unsold inventory while maintaining that CRM-centric view of the customer, it’s a huge advantage. It’s a choice and flexibility to participate in an ecosystem with their rules and parameters they are comfortable with,” according to Fowlie.
AudienceView will not be exclusive to StubHub or vice versa. This is simply a first foray to add to the company’s distribution channels.
“The model for event discovery is going to move beyond people Googling and finding a website for the venue,” Fowlie said. “It’s going to be mobile apps and other brands and platforms that will use different data to help drive event discovery for the consumer. We can’t sit back and assume if we help our customer build a really slick website and maybe a mobile app that they’ll be successful, because consumers today are making decisions in very different ways than they did 20 years ago.”
He estimated that in 2014, AudienceView will move north of 45 million tickets and get close to $2-billion worth of transaction processing value.
In 13 years, StubHub has gone from a scrappy startup to a market leader — selling one ticket per second with offices in the U.S., U.K. and Canada. Over 115 million tickets have been bought and sold on StubHub since 2000, said StubHub’s Alison Salcedo. “On average, over 8 million people visit our site a day. The ratio of sports:music tickets sold on StubHub is just about 50:50.”
Fowlie believes it’s critical ticketing companies open up the ecosystem for distribution. “We’re not looking at this from a business ROI point of view. We’re building out our path to getting onto those mobile apps the consumer of tomorrow is going to use. We know that is going to be an absolute requirement for distribution. We want to do it in a responsible way.”
But at the back end it comes back to a single inventory, Fowlie admitted. “The back end has to be able to control what is available. In a web environment we can control those search results, first 10, next 10, managing the load. But with a connector, computer to computer, it doesn’t want the next 10, it wants everything available. We want to manage this framework intelligently. When we look at the future of entertainment, it’s like a broad ecosystem and different branded channels coming into that single point at the back end of the inventory.”
StubHub will add a fee to tickets to monetize this strategy. The customer will be aware of the fee.
“The fan on StubHub pays fees on any transaction,” noted Katz. “We’re doing a lot of dynamic fee structures, based on supply and demand. We’ll see where the buyer fees need to go. We monetize with fees, but we don’t have a bench mark yet. AudienceView sends us one price that incorporates all their fees, then we add our fees. In some cases the buyer is paying more. In some cases we might be the same.”
For a monthly fee, AudienceView customers are entitled to improvements in the product. This enablement of distribution and discovery will be highly valued by AudienceView customers, Fowlie predicted.
“They are entitled to the software for free. They don’t pay for the next release, but they do pay for any services required to migrate them from one release to the next. They do pay for professional services required to implement and move to the new version – data migration, additional training – our people costs – professional services,” Fowlie said. “If a customer is on an old release and going to a new one, it might take 15-20 days. It also depends on customizations implemented on top of our product. With our AV Pro offering though, those upgrades don’t cost anything – it’s driven by size of venue, but once we set that flat fee, they don’t pay other fees. They enjoy the upgrades based on their monthly fees. Contracts run five years on average.”
Interviewed for this story: Mark Fowlie, (416) 687-2111; Michael Katz and Alison Salcedo, (310) 947-2648
- by Linda Deckard
- Published: December 17, 2014