Social media driving live’s growth, says top US analyst
Social media will play an increasingly significant role in a booming live event economy in the US, according to an analyst at one of the Big Four banking institutions in the country.
The role of social in fan growth globally was highlighted in a note sent to clients last week by Bank of America analyst Jessica Reif Ehrlich, who commented: “The live entertainment industry has been one of the most robust growth engines of the music industry over the past 20+ years.”
According to a recent estimate from Morgan Stanley, summer concerts by artists including Taylor Swift and Beyoncé, as well as blockbuster films such as Barbie and Oppenheimer, are expected to add a combined $8.5 billion to US growth in the current quarter.
Ehrlich laid out five catalysts that will lead to sustained long-term growth in the industry: continued spending shifts towards services and experiences; healthy pricing power amid increased demand; positive supply and demand trends as social media apps like TikTok boost global awareness and fan growth; the relatively “disruption-proof” nature of live events as virtual methods remain incomparable; and the advent of experiential marketing.
“The live entertainment industry has been one of the most robust growth engines of the music industry over the past 20+ years”
“Not surprisingly, we believe talent, especially artists that command huge fan bases, will be able to increasingly extract incremental value out of the ecosystem (largely driven by increasing supply and ticket pricing), while venues, which have several independent revenue streams, accrue the most value,” Ehrlich said.
The comments echo Live Nation CEO Michael Rapino who spoke at Bank of America’s Media, Communications, and Entertainment Conference last Wednesday (13 September).
“It’s that important badge in [a fan’s] life to make sure that they can tell people they were at the Beyoncé show,” he explained. “Artists and what they’re able to drive with that relationship, with that fan, [through live] is just a bond that we’ve never seen before — especially with social media.”
Noting the hit the industry took from Covid-19, Ehrlich assured clients that “consumer demand for live entertainment has come roaring back”. “This backdrop has supported supply and demand tailwinds which all appear to be sustainable over the next several years.”
“Live entertainment is currently the brightest star in the broader media and entertainment universe,” she said.
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