Sales & Marketing Alignment: How to Synergize for Success
Competitive position analysis
1. To:Rachel Survil,
(Marketing manager, Beatport)
From:Shridhar Prabhu,
grp12A, LDPA Beatport
Re:Live Nation Competitive Position and analysis
Introduction
Live Nation is the largest producer of live events and entertainment content
catering to the music culture, connecting more than 250 million fans across all of our
platforms to well over 180,000 events in approximately 47 countries in 2012 . The Company
competes within a segment of $23.7 Billion of the overall music & live event promotion
industry. Its competitors are diversified within various strategic groups encompassing ticket
sales, Live events, Sponsorship and Advertising companies such as Live Nation and
Pandora which involve the Sale of Merchandise and have various Distribution networks
encompassing promoters and third party venue agents, and finally e-commerce giants such
as i-Tunes which involve the sale of online music and have a very large customer base.
However Live Nation enjoys an enviable competitive position in this industry due to its
massive scale and steady expansion, planned acquisitions and a very large consumer base
which is fostered by deep engagement of the global live events which the company
conducts.
Competitive position
The competitive position of Live Nation in the electronic dance music is
highly dominant. The company is the leading presenter of electronic music festivals and
events, many of which have more than a decade of history. This is backed up by a very large
fan base, which comprises of passionate followers and vibrant social communities. On a pro
forma basis for the completed and planned acquisitions, the company attracted 49 million
fans to over 22,000 events as of 2012, making it the largest producer of live music concerts
in the world. The company is continually investing in various festivals and events and adding
various creative aspects in each one of them to re-define their uniqueness and to provide the
2. best entertainment experiences to the people. Many of the festivals for which the company
has acquired rights for have a long history and have achieved substantial popularity and
success both in Europe and USA while attracting fans globally. The company faces threat
from similar incumbent firms such as SXL, Anschutz Entertainment (Exhibit 3) Along with
that the company faces competition in the markets, which promote music concerts, notably
from both promoters and venue operators. Some of the competitors have a stronger
presence in certain markets and have access to other strategic venues and may have
greater financial resources, which may enable them to gain a greater competitive advantage
than us.
The company is well diversified and has its revenue streams in three major areas, namely
1] Ticketing sales
2] Venue operations
3] Sponsorship and advertising
4] Artist management
Live nation has the advantage of being at the forefront of worlds live entertainment ticketing
sales. The subsidiary TicketMaster continues to be the worlds leading provider of ticket
sales, marketing and distribution globally. TicketMaster serves across multiple event
categories, providing ticketing services for leading arenas, stadiums, professional sports
franchises, performing arts and theatres through various branded and affiliated website. As
per as 2012 the company has well over 119 million customers in its database based on
visitors to www.livenation.com, thus further adding to its e-commerce repertoire. Along with
offering ticket sale services the company also offers ticketing re-sale services, which refers
to the sale of tickets by a holder who originally purchased the tickets from a venue, promoter
of other entity. According to statistics, the company may very well be the second largest
operator of music venues. This places the company in a key strategic position and gives it a
upper hand amongst its competitors as it covers almost all the aspects of event
management. This also means that the company is well diversified and has various revenue
streams through which it operates. But, some of the niches, which the company operates,
have fewer barriers to entry and the fact that many entrants and incumbents can still exploit
that remains a primary point of concern. Over the course of years, the company has
positioned itself very well in the field of Sponsorship and Marketing. The company has a big
global distribution network of promoters, venues and business across the world with offices
in 72 cities across North America and 24 countries worldwide. The company employs
3. approximately 200 specialized people that have worked with many of the well-recognized
national and global brands including O2 etc. The segment, which is managing the artists, is
Artist Nation, and it is providing excellent management services to the music artists. The
company has very well catered to the needs of the artists, by negotiating fair contracts with
them. This involves selling merchandise associated with the musical artists and providing
other services to artists along with well descriptive and flexible contracts. This serves as an
advantage over the other incumbent firms as the company now not only has artists on a
contract base, but also the manages artists themselves thus creating a self sustaining cycle
in which the company solemnly caters to, to what it adheres for. To put it simply, the creates
events - and has the necessary artist line-up to back it. The numbers point to approximately
around 250 artists. This is a key benefactor considering the fact that the artist line-up is in
itself one of the most important aspect, when it comes to live events. Exhibit 2 shows the
industry structure.
The company’s primary revenue steam remains strong, i.e. the ticketing subsidiary is
operating at its peak and is generating substantial revenues along with creating platforms
and opportunities for the other subsidiaries. For example ever costs such as artist fees and
production service expenses are included in direct operating expenses and are related to the
ticket sales, number of events, volume of ticket sales and prices .The company has done an
exceptional job with sponsorship and advertising campaigns at an international, national,
regional and local level . To foster relationships with the third party companies and to display
an efficient scalability of its reach, the company is effectively undertaking promotional
programs for a variety of companies desiring to promote their brand or product.
However there are may competitors who are trying to copy Live Nations success. the
competition comes from similar companies who are trying to diversify their business to
increase revenue , thus venturing into niches in which the subsidiaries of Live Nation are
already pre-existent, thus increasing the level of competition. For example Anschutz
Entertainment operates under a number of different names including AEG Live, Concerts
West, and the Messina Group. Speaking about niches, particularly those that are ecommerce based like online sale of tickets and online promotion face fierce competition as
the barriers to entry are comparatively low and there is a tremendous scope for
differentiation and innovation in them. Our main competitors in the live music industry include
C3 Presents, AEG and SXL in addition to various smaller regional companies and various
casinos in North America. Exhibit 1 shows the five forces analysis for music and live event
promotion business
4. Course of action
Expanding the platform to sell more tickets which involves further
expanding the fan base by selling more tickets and continually adding top global music
markets and further building the market share in established markets.
Along with further building market share in established markets, the company should also
focus on expanding the demographic scope of their operations. The company needs to
venture into new uncharted markets of the Asian and African countries like India, Philippines,
Malaysia, and Ethiopiaetc., where there is a tremendous scope of creating effective revenue
streams. The company should look forward to cater to the already existent but small in scale
music culture and provide them with the expertise and refined-services, which the company
has developed over the years. This includes pursuing many initiatives to enhance the fan
experience, providing efficient and effective means of access to event passes,
accommodation logistics, social media interaction and partnership with top-tier food and
beverage partners in that country. Along with that, the company should also give a priority to
platform creation & discovering of new artists . This can be subsequently achieved by
utilizing the experienced management team, which the company has. The management
team's reputation and experience in music, live entertainment and related businesses should
make it a valuable partner to the creative talent. Fostering deeper engagement with the
electronic music community particularly EDM, since it is comprises of the most rapidly
developing music genres. Creating and mixing of electronic music is a collaborative process
that is highly accessible given the ready availability of music and mixing tools. This music is
typically enjoyed as a part of a communal experience, which in turn is commonly shared and
perpetuated via social media. Priority should be made to improve the fans experiences by
responding to their growing demand to "engage" with the EDM content and the EDM
community. This Is highly evident from the Exhibit 2 . Creating a closer integration in
between the online properties to enhance the fan experience between and around events.
5. Exhibit1 : Five forces analysis of Live events promotion and marketing company
8. References:
About Live Nation :http://en.wikipedia.org/wiki/Live_Nation
Live Nation company overview and statistics: http://www.nasdaq.com/symbol/lyv
The EDM music genre: http://www.forbes.com/sites/ryanmac/2012/10/30/djz-connectinggeneration-z-with-a-booming-electronic-music-business/
Live Nation Concerts and Deals :http://en.wikipedia.org/wiki/Live_Nation_(events_promoter)
TicketMaster: http://en.wikipedia.org/wiki/Ticketmaster
Anschutz(AEG) Entertainment Stock Filings, Stock quote and summary data :
http://www.nasdaq.com/symbol/aeg
Stock Information, Reports and SEC Filings
:http://investors.livenationentertainment.com/investor-relations/
![best entertainment experiences to the people. Many of the festivals for which the company
has acquired rights for have a long history and have achieved substantial popularity and
success both in Europe and USA while attracting fans globally. The company faces threat
from similar incumbent firms such as SXL, Anschutz Entertainment (Exhibit 3) Along with
that the company faces competition in the markets, which promote music concerts, notably
from both promoters and venue operators. Some of the competitors have a stronger
presence in certain markets and have access to other strategic venues and may have
greater financial resources, which may enable them to gain a greater competitive advantage
than us.
The company is well diversified and has its revenue streams in three major areas, namely
1] Ticketing sales
2] Venue operations
3] Sponsorship and advertising
4] Artist management
Live nation has the advantage of being at the forefront of worlds live entertainment ticketing
sales. The subsidiary TicketMaster continues to be the worlds leading provider of ticket
sales, marketing and distribution globally. TicketMaster serves across multiple event
categories, providing ticketing services for leading arenas, stadiums, professional sports
franchises, performing arts and theatres through various branded and affiliated website. As
per as 2012 the company has well over 119 million customers in its database based on
visitors to www.livenation.com, thus further adding to its e-commerce repertoire. Along with
offering ticket sale services the company also offers ticketing re-sale services, which refers
to the sale of tickets by a holder who originally purchased the tickets from a venue, promoter
of other entity. According to statistics, the company may very well be the second largest
operator of music venues. This places the company in a key strategic position and gives it a
upper hand amongst its competitors as it covers almost all the aspects of event
management. This also means that the company is well diversified and has various revenue
streams through which it operates. But, some of the niches, which the company operates,
have fewer barriers to entry and the fact that many entrants and incumbents can still exploit
that remains a primary point of concern. Over the course of years, the company has
positioned itself very well in the field of Sponsorship and Marketing. The company has a big
global distribution network of promoters, venues and business across the world with offices
in 72 cities across North America and 24 countries worldwide. The company employs](data:image/gif;base64,R0lGODlhAQABAIAAAAAAAP///yH5BAEAAAAALAAAAAABAAEAAAIBRAA7)