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UK promoters discuss impact of currency fluctuation

A number of UK promoters have spoken to IQ about the impact of currency fluctuation on international touring, as the pound sterling continues on a tumultuous trajectory.

The currency slumped to a two-week low against the dollar of $1.0954 on Tuesday morning (11 October), before rebounding less than 24 hours later. However, Goldman Sachs told Pound Sterling Live it expects the pound to continue to weaken due to “flawed fundamentals”.

Richard Buck, head of European touring and Middle East partnerships at TEG Europe, tells IQ that the declining rate is having “a significant impact on international touring”.

“Offers made in USD, if the currency is not pre-booked, may need to be adjusted or even pushed back,” he says. “Also for artists who are paid in pound sterling, it becomes less attractive to visit the market as their potential return can diminish by around 20% versus the original forecast.

“Anyone that is incurring costs in dollars and getting paid in sterling, in particular, is going to struggle”

“Any multi-territory deal that has been made in USD is now harder to sell into territories as the return is harder to achieve. However, those already sold into markets such as the Middle East where the primary artist currency is USD may benefit from the improved conversion.”

The pound fell to an all-time low of $1.03 last month in the wake of the government’s mini-budget, prompting AEG Presents UK chief Steve Homer to list the exchange rate as one of the promoter’s biggest concerns, while US artists including Animal Collective cancelled tours, in part, due to currency devaluation.

But as Kilimanjaro Live CEO Stuart Galbraith points out, dwindling currency is not an issue unique to the UK.

“The dollar is strong against most currencies in the world at the moment so it’s probably an issue in Europe generally,” he notes. “But anyone that is incurring costs in dollars and getting paid in sterling, in particular, is going to struggle.”

Galbraith says that even though a large proportion of Kilimanjaro’s business is domestic, the promoter is still seeing the effects of the pound-to-dollar slump.

“Acts from America are telling us that they cannot afford to tour in Europe. We’ve certainly lost a couple of isolated shows in the last three or four months and we had a couple of tours that we were about to go on sale with but we’ve now been told the artist isn’t coming to the continent.

“Some acts will have put together budgets earlier on in the year when they were expecting they’d get a $1.30/40 for every pound. If they’re now redoing those budgets on an almost parity basis then you can absolutely understand why they’re not able to balance the books and go through with the tour.”

“It comes down to whether a US artist is able to use crew and suppliers that are UK and Europe based”

Galbraith says there are two possible short-term solutions for American artists. The first is to incur as many costs as possible in local currency and minimise the exposure to dollar expenditure, and the second is to reduce the scale of the show and do it on a more cost-effective basis, he says.

“It comes down to whether a US artist is able to use crew and suppliers that are UK and Europe based, instead of bringing staff and equipment from the US – which is all going to be paid for in dollars – and incurring transatlantic flights which are now extremely expensive in comparison to pre-covid times,” he says.

While Galbraith believes cost-cutting measures could be the solution to bringing US artists to the UK, Homer is concerned it’ll come down to UK promoters to offer bigger fees.

“We were almost on parity, which has not been something we’ve been familiar with for a long, long time. And it’s really biting in terms of artists touring over here – it becomes far more expensive for them to do it and it’ll be interesting to see how that impacts going forward. It’s creating a few anxious thoughts as to whether we can afford to offer American artists what they need to come over, so it might mean we’re missing a few that we would normally see.”

 


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Spend, no-shows and demand all up in UK, say promoters

Leading promoters in the UK live industry say they’re experiencing mixed fortunes following the full reopening in England on 19 July.

As the sector launches into recovery mode, executives are reporting high levels of pent-up demand for many shows.

Denis Desmond, chairman of Live Nation UK and Ireland, says: “Artists, promoters, production and marketing teams are champing at the bit and ready to meet the demands.

“Thankfully our festivals happened, and we were very pleased with sales which proves that the demand for live music is still going strong. Now we’re moving into touring season and we have a busy schedule lined up for the rest of the year and into 2022.”

As the live sector prepares for what looks to be its busiest year ever from 1 January, promoters say the UK’s next challenge will be keeping up with demand given that much of the supply chain has yet to recover.

“We’ve got 18 months of touring coming up across the UK and all of the suppliers are going to be hugely stretched,” says Richard Buck, CEO of TEG MJR, the UK subsidiary of Sydney-based live entertainment and ticketing firm TEG.

“Artists, promoters, production and marketing teams are champing at the bit and ready to meet the demands”

Desmond agrees, adding: “Going forward there are still challenges including issues with the supply chain and many talented specialists have been forced to leave the sector, plus there remain complexities for touring in Europe post-Brexit.”

And as an autumn period of touring kicks off, the ongoing spectre of Covid-19 is a continued source of uncertainty for promoters who say the rate of no-shows at concerts is far higher than usual.

Buck reports “anywhere up to 50% no-shows, especially on postponed shows. It’s a little less if the show is taking place closer to the time when it was announced but at sell-out shows, there has been significant no-attendance”.

Buck believes the no-shows are down to an “amalgamation of low confidence, forgotten tickets and isolating” and predicts three to six months for the levels of attendance to go back to what they were pre-pandemic.

UK-based promoter and venue operator DHP Family is also experiencing high rates of no-shows and says it’s increasingly hard to predict attendance post-Freedom Day.

“[Attendance] varies by artist and how many times the show has been rescheduled etc,” says DHP’s director of live, Anton Lockwood.

“[There has been] anywhere up to 50% no-shows, especially on postponed shows”

“We’ve seen 20–30% on bigger shows. Typically smaller shows are less predictable; it can be 100% attendance or, if it’s the kind of show where the artist has been relying on their friends and family to turn up, it can be up to 75%. It’s all over the place.”

While refund requests are reportedly very low, most events are currently offering a refund to ticket holders who can’t attend due to a Covid-related illness on a discretionary basis.

“If it’s a rescheduled show, you’re entitled to a refund, the end,” says DHP’s Lockwood. “But there’s a debate about if you’ve got Covid, whether you’re entitled to a refund or we should just give a refund out of kindness.”

Fortunately, DHP has also not seen huge numbers of refund requests so far: “It’s not caused a problem but it is a worry because if you settle the show with the artist and then some of the refunds come in, you’ve got a problem.”

Buck says TEG MJR is being “lenient” when it comes to refunds but they are dealing with it on a case-by-case basis.

“We’re being a lot more liberal with refunds because we want people to buy in confidence when the market opens which is a slight double-edged sword,” he explains.

“2022 and 2023 sales have been disproportionately strong… probably 20-25% up on forecast”

“Previously, if you had a sold-out show it was sold out. Now, it’s a lot more difficult to settle on the other side because you’ve got refunds post-event,” Buck concludes.

But while Covid continues to cause operational complexities, Buck says the increase in spend-per-head at concerts is “dramatically up” versus pre-Covid and ticket sales for new shows have soared.

“2022 and 2023 sales have been disproportionately strong,” he says, “Probably 20-25% up on forecast.”

And with the threat of last-minute venue closures due to staff being ‘pinged’ (told to self-isolate by the NHS app) or contracting the disease, alongside similar worries with touring parties, many say recovery feels like a gradual process.

“We don’t know whether the shows are going to happen or not, whether the artist is going to be able to travel or they end up catching Covid,” says Lockwood.

“People assume it is all back to normal but everything is just much harder. It’s great to be back, don’t get me wrong, but the uncertainties have ramped up.”

 


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TEG MJR and Snoop Dogg sign exclusive touring deal

TEG MJR, the UK-based promotion division of Asia-Pacific live powerhouse TEG, has secured an exclusive five-year deal with hip-hop heavyweight, Snoop Dogg.

Under the multi-million-dollar deal, TEG MJR will promote all of Snoop Dogg’s tours globally outside of North America, beginning with dates for Snoop’s 2022 world tour.

The European leg of the tour kicks off on 20 February 2022 and includes rescheduled sold-out shows at London’s 02 Arena (cap. 21,000), Dublin’s 3 Arena (cap. 13,000) and Amsterdam’s Ziggo Dome Arena (cap. 17,000).

TEG MJR CEO Richard Buck penned the agreement with Snoop’s international agents Julian O’Brien and MPI’s Minneapolis-based partner Nabil Ghebre, who have been working closely together with Bobby D (Aaka Robert Dreislen), who is at the helm of Snoop Dogg’s operations in Los Angeles.

Geoff Jones, CEO of TEG, says: “Snoop Dogg is a hip hop pioneer and one of its greatest live performers. He has won an astonishing number of awards and nominations and we are thrilled to be able to bring the man and his music live to fans the world over for the next five years.”

“We are really excited in helping him bring both his new music and back catalogue to life with this touring partnership”

Richard Buck, CEO of TEG MJR, says: “Snoop is one of the most respected and prolific hip hop artists on the planet. We are really excited in helping him bring both his new music and back catalogue to life with this touring partnership.”

Bobby D, Snoop Dogg’s manager and co-owner of Uncle Snoop’s Army, says: “We are excited about this five-year international partnership with TEG and to continuously come overseas to connect with our fans around the world.”

Uncle Snoop’s Army is a multi-million-dollar LA-based music and entertainment company representing hip-hop artists.

The first dates on Snoop Dogg’s world tour (including rescheduled dates for the UK, Ireland and Amsterdam) are:

20 Feb 2022 – Telenor Arena, Oslo, NO
21 Feb 2022 – Bella Center Kongreshal, Copenhagen, DK
23 Feb 2022 – Koepi Arena , Oberhausen, DE
24 Feb 2022 – Sportpaleis Arena , Antwerp, NL
25 Feb 2022 – Max Schmeling Halle , Berlin, DE
27 Feb 2022 – Accor Arena, Paris, FR
28 Feb 2022 – Ziggo Dome Arena, Amsterdam NL
02 Mar 2022 – SSE Hydro Arena, Glasgow UK
03 Mar 2022 – Resorts World Arena, Birmingham UK
05 Mar 2022 – AO Arena, Manchester UK
07 Mar 2022 – First Direct Arena, Leeds UK
08 Mar 2022 – 02 Arena, London UK
09 Mar 2022 – 3 Arena, Dublin IE
11 Mar 2022 – INEC Arena, Kerry IE
12 Mar 2022 – SSE Arena, Belfast UK

 


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