Strategic Analysis of Live Nation Entertainment



The following paper was the final deliverable for my MBA strategic management course at Southern New Hampshire University. The purpose was to analyze the macro-level strategy of an organization of our choice.  For ten weeks, we explored how that strategy impacted virtually every aspect of the firm from their financials to their competitive position and H&R practices. I chose to put my experience as a booking agent and undergraduate degree in music business to good use and analyzed the top promoter in the world – Live Nation Entertainment.

My analysis of Live Nation Entertainment revealed an organization executing a well-crafted strategy to vertically integrate the unique value chain elements of their main concert business. As a result, the company has catapulted past their competition in the U.S. concert and event promotion market as well as the global online ticketing industry where they hold commanding market shares in each. Despite this success, there is much more opportunity for the company to grow…almost an entire planet.  I touch upon management’s future plans throughout the paper and offer my own insight as well.

Jeremy Larochelle’s Strategic Analysis of Live Nation Entertainment

Lessons from a Mexican Restaurant


The other day I went to my favorite Mexican restaurant for lunch.  It is a quaint little “mom and pop” shop that makes some great food, has an awesome atmosphere, and plays great Latin music.

I noticed they had a sign by the cash register that said:

Join Our Email List

Get 20% Off Your Meal

Get Great Coupons and Chances to Win Prizes

That sign made me realize that so many artists offer me nothing to join their email lists, and you know what?…It greatly reduces the chance I will.

Seems my homegrown Mexican entrepreneurs know more about marketing than most entertainers.

Musicians undervalue the power of the email list.  It is a direct connection to your consumers. It is a way to tell them about your new album, so they buy it. Inform them about upcoming shows, so they go. Showcase your newest merchandise, so they wear it. And to like, follow and join your social media networks so you can keep them informed and connected.

Most of you looking for a record deal have no idea that labels place a lot of weight on your mailing and social lists. Why? Because they know if you can get 2,000 people to follow you on your nothing budget than their $500,000 check would get exponentially more fans interested, which leads to more money.

Even those of you who want to make it on your own have no idea the power of an email list. That list is a great way to keep your fans coming to shows and buying into your brand. It is also a great selling tool to help you get money from sponsors who want to put a link on your site, a banner at your show, or a tattoo on your drummer’s forehead. And the more names you have, chances are the larger the paycheck.

Basically put, in today’s marketing world the email list is gold, so you have to work hard to get people to join it.

Remember it is a business transaction and every exchange with a consumer (even when there is no money involved) requires you to give them something for their currency, even if that currency is their email. Offer them a few free tracks, a free concert ticket, a chance to win something cool and there is a greater chance they will join your cause.

Never underestimate the power of consumer information and the email list is a great way to get it.

Do This When You Play Live to Elevate Your Music Career



Look like you care. Play your best show even if the room is empty.

Part of my job is to hit up clubs and bars and check out bands. Now I am not looking to give you a record deal or finance your musical dreams. I am a booking agent, and before we book a band we always check you out live. If you pique our interests, and we have a spot, one little visit could lead to a lot of money and exposure for your group.

It happened the other night. I was at a big name show and afterwards popped my head into a local bar. I caught an amazing band who had a great product. They looked good, they played good, they had video, they were having fun. So I said to myself “I am going to book them”. Less than a week later I had another group drop out of a big gig and bada-boom that group I had found landed a show making more money than they were used to in a new market that could lead to future gigs and more fans for their tunes.

Unfortunately, this is not the norm in our industry.

I watch a lot of bands… a lot. And I am surprised at how many are just up on stage for the paycheck. The singer is giving it half her range, the guitarist is half-drunk and the drummer is clearly thinking about what he is going to eat at Taco Bell later. The room is dead, because nobody is entertained by boring.

As a former touring musician myself, I understand your pain. It is tough to look like you care when you are tired, the room’s dead, and you have played the same songs a billion times. It can be tough to dig yourself out of that ditch. But you have too because you never know who is watching and what they could do for you.

So what can you do to get that “oomph” back in your show?

Learn some new tunes: This is the quickest fix. If you feel like you are playing the same set-list night in and night out, then maybe it’s time to throw in some new songs to liven things up. Sometimes all it takes is one or two extra tunes to bring the bassist back from the dead.

Don’t play as much: This might be a tough one to swallow, but it is true, especially if you play in the same market. Ever heard the old adage “to much of a good thing”. Well, if you play the same two bars night after night, that is certainly the case for your fans and for you. Industry pro, Rick Barker, says it best in his book The $150,000 Music Degree, by doing this “you are damaging the demand for your product, which is weakening your business leverage against the venue.” Try cutting back your gigs, even if it is for a couple weeks and see if you get a better reaction from your fans and the band. If that doesn’t work, or it scares you because you need the money, it might be time to investigate new markets. Quite honestly, if your plans are to gain the exposure you need to be doing that anyway. Unless you are in New York, Nashville, or LA playing in the same zip code night after night will not get you on the radar of industry gatekeepers.

Mess with your mind: Nope, not talking about smoking three joints before you hit the stage, I am talking about psychology. I used to have a trick that worked. From behind the kit I would pick out a face in the audience that I didn’t know and convince myself they were a big-shot and could help advance my career. 90% of the time it worked and I played a little bit better.

Those are just a few suggestions. I encourage you to try your own. The point is that your live performance is vital to your career, no matter what you are trying to achieve musically. I know that, 90% of the time, A&R scouts will need to see a band live before presenting a group to their label. Managers and booking agents, such as myself, need to make sure that you can hold a crowd. This is extremely important in today’s market, where live performances are needed to make up for the loss of recording sales, and this will only gain more importance as the market continues to shift towards streaming consumption.

So bottom line, you need to put on a great show every single night, no matter how many people are in the room, how they are reacting, or how you feel. This is a part of being a music professional and a vital component that will separate those who make it in this industry from those who end up asking if “you want fries with that”.


When Hooks Become Brands Part II


In my last blog I explored how rock/metal group Metallica crafted excellent hooks into their songs. Each member of the band has seemed to contribute to catchy phrases on their respective instruments that, over time, have evolved into brands that have helped elevate Metallica’s success.

The term brand came to us from cattle ranchers who would burn their mark into their livestock to help differentiate their products from hordes of others.  Over the years branding has become big business, helping merchants distinguish their products from those of their competitors. Today, proper brand execution can give the firm value beyond its wildest dreams.  According to Forbe’s 2013 Apple’s brand is worth $104.3 billion; Microsoft’s $56.7 billion; and Coke’s $54.9 billion.

Branding isn’t just the name, the logo, the colors the firm chooses, or even the slogan. It is a combination of all of these elements along with the development of a feeling the consumer gets, or is intended to get, from the product or service. Coke makes you feel refreshed, Hershey brings us sweet joy, and Apple offers unique yet simple products that are easy to use. If executed properly over time these brand feelings become imbedded in the consumers psyche, so when they are sad they look for Hershey chocolate, when they are parched they grab a Coke, and when they want to “Think Different” the fire up an Apple product.

In today’s market musicians and entertainers MUST think the same way.

They must turn their passion into a brand.

There is far too much noise in the market right now. Anyone can record an album, anyone can follow you on Twitter, anyone can start a Kickstarter campaign, and by anyone, I mean anyone around the world.  That is a lot of people all vying for listeners to give their songs a chance, to stream their tunes, to come out to a show.

Call me old fashioned, but I still feel the longest lasting, and thus more profitable musicians, are those who can craft better songs, tunes with great lyrics, a story to tell, and of course excellent “hooks”. Think about it for a bit. Metallica has remained relevant and profitable for the past 25 plus years, Jay-Z has launched an empire off of his ability to combine his tales with the perfect musical compliments, and the Beatles continue to influence generations over fifty years later.

Below is a small sample of some of the things you should think about when crafting your next tune if you want them to emerge as their own living breathing entities like Metallica has done. I remind you this is not a complete list, just a few random thoughts and suggestions.

1. The best hooks are simple:

As musicians, we tend to over think how music should be. We feel that complexity makes things better. Most of the time it does not. The people who buy your music need to be able to hum along and that is easier when you keep it simple from the get go.

 2. It takes more than one:

Part of the Beatles’ success came in the melody and counter melody parts written by John and Paul. The same can be found in the music of Led Zeppelin. The best songs meld rhythmic structures and melodies perfectly. I once read one rock critic describe it as creating a balanced sense of tension for the listener. Too far in either direction and it would sound awful, but when placed in the perfect pocket it becomes magic.

3. Producers are worth their weight in gold:

No I don’t mean your buddy who has ideas about your next song, I mean real producers such as Rick Rubin, Jerry Wexler, Glen Ballard, Jimmy Iovine, and Pharrell. A lot of artists think they can produce their own songs, but they get stuck, especially in problems arriving from point one above. The best producers know how to take away extras from the song, which allows the hook to shine through. They know how to connect your ideas with the music listener, who is usually enjoying music in a different way than you are.

4. Don’t throw in a hook just because it sounds cool:

I will return you to my analysis of Metallica and the haunting opening to Welcome Home/Sanitarium. This isn’t a complex hook, but it fits in with the overall theme and dark feel of the song. The hook needs to be thought of as an overall component to the brand you are trying to develop for that song. The Beatles’ producer George Martin was a master of this. Songs such as Yesterday are stripped down, forcing the consumer to become directly attached to the haunting lyrics, while Sgt. Pepper’s Lonely Hearts Club Band brings in a lot of noise and ruckus to make you feel as though you are surrounded by a, you guessed it, marching band.

5. Hooks can be anywhere:

A great hook doesn’t need to be played on the guitar or piano.  It can come from the bass. Dave Matthews Band bassist Stefan Lessard proved that in the tune Crush. It can come from the drums. Steve Gadd proved that with his catchy rhythm on Paul Simon’s 50 Ways to Leave Your Lover. It can even come from secondary lyrics. Who doesn’t say the phrase “turn it up” when listening to Sweet Home Alabama by Lynyrd Skynyrd?  The point is that catchy hooks can come from any member of the group, so keep that and point number two above in mind.

The thing to remember is that your musical brand revolves around the tunes you create. When you take the time to craft songs that utilize all of their aspects (lyrics, tempo, genre, instrumentation, and production) to help articulate your intended feeling onto the music listener you stand a better chance of connecting with those listeners on a psychological level that will keep them returning to your brand over and over again.

When Hooks Become Brands

The other evening I kicked back, cracked a few beers and watched Metallica’s “Through the Never”. I have always been a fan of the group, caught them live on several occasions and own all of their albums. However, this time I watched their concert through the lens of a marketer, and what did I learn?

Metallica’s hooks have evolved into their own mini-brands that fuel the group’s ongoing success.

To help explain what I mean let’s look at a few great Metallica hooks and how they exploited them into a multi-million dollar franchise.

First take a listen to the opening of  their 1988 hit One. The simple haunting guitar hook sits on top of a background of gunfire helping set-up the overall feel of the song. It is a well crafted piece of music that would eventually catapult into it’s own brand image starting with a music video that left every kid in the late 80’s/early 90’s in complete awe.

Now watch how they carried that hook (now a brand) through to their live show 24 years later.

In 1984 the group unleashed Ride the Lightning offering up one of the most iconic Metallica tunes to date, For Whom the Bell Tolls. The song started with the sounds of, you guessed it, church bells followed by the pounding full band hits that have become a rally cry of fans everywhere.

Metallica has proven they know how to write a hook, and those hooks come from every member of the group. There are the dual guitar riffs that open Seek and Destroy. The haunting opening of Welcome Home (Sanitarium). Lars’ precision double bass in One.They even managed to turn lyrics into hooks. Remember Hetfield’s prayer in Enter Sandman followed by that “BOOM”? This group knows how to make music that sticks in our collective minds. Hooks that are so memorable they have evolved into very valuable brands for the franchise.

And it isn’t just hooks that Metallica has branded through the years. They also branded entire albums, carrying iconic themes through decades of live shows. Remember the cover for their 1986 release Master of Puppets?


They carried that imagery over into their live shows.  Here they are performing in Seattle in 1986. Notice the iconic crosses in the background?

Now here they are performing 24 years later. They stay up-to-date with the latest in stage performance technology, but stick to the branded imagery of the album. Those haunting white crosses.

How about the cover of And Justice For All?

And Justice for All Cover Art

Lady Justice came to life, and then crashed down, in their most recent tour which was featured in the live concert video Through The Never.

Metallica’s ability to write hooks has placed the group on a successful trajectory. There is no doubt that when Elektra Records A&R director Michael Alago, and co-founder of Q-Prime Management Cliff Burnstein, attended that September 1984 Metallica concert they realized the potential of those hooks and the opportunities that Metallica’s sound provided, which encouraged them to sign the group to a deal that has since launched one of the most successful acts on the planet.

According to an article in Guitar World “they are on the exclusive list of music artists who have sold more than 100 million records, and each of their albums has enjoyed multi-Platinum status, an achievement that even AC/DC, the Rolling Stones and U2 haven’t matched. And according to an article in Loudwire, in 2012 the group only played thirty shows, but took in $86.1 million in ticket sales. That’s about $3 million per show.

Sure, there are numerous factors that have played into Metallica’s success. They were first movers in the thrash metal scene of the 80’s, helping establish them as a namesake in the genre. A genre whose success lies in touring and not #1 Billboard hits, which ultimately builds a loyal fan base. But there is no doubt that the memorable hooks they developed have emerged as their own icons of music, which, in turn, have provided the group with huge notoriety and success.

Bands and artists seeking long term success in music should break out their note pads and take a course in Metallica, which, by the way, would be the best college class ever!

In my next post we will dive deeper into how hooks have evolved over the years and why musicians should look at them to help fuel their success.

Ticketing as a Marketing Tactic

Up until the early 80’s venues, promoters, and their distribution partners handled ticketing directly. Then in 1982 an analyst named Fred Rosen came up with the idea of offering cash strapped performance organizations bonuses and advances if they signed over their ticketing exclusively though his company. Rosen’s model paid off and Ticketmaster went on to dominate the ticketing industry.  In 2010 the firm merged with concert promoter Live Nation to become the largest concert promotion company on the planet, selling an estimated 119 million tickets worldwide that year.

To this day, Ticketmaster continues to dwarf the market, but that doesn’t mean promoters and venues aren’t without options. Thanks to the proliferation of the Internet, new services have emerged that allow promoters the opportunity to control the sale, but perhaps more importantly, the marketing of their event.

Companies such as TicketforceVendini, and Flavorus fill the voids of Ticketmaster in a few key ways.  First, they allow the promoter to control every aspect of performance sales dates from any computer with online access. For those utilizing Ticketmaster, pre-sales, on sales, and ticket cut-offs must be coordinated through the ticketing giant and their system built on non-user friendly software. Managers do not have direct access to their own events. This makes it difficult for the promoter or venue to get tickets listed quickly, enact unique pre-sale campaigns, adjust ticket sales cut-offs, and release holds on their schedule. Second, these services do not place their own fees on top of the ticket price. Instead they bill the promoter or venue directly. This can create huge good will for consumers who are used to seeing their $45 ticket change to $55 plus after fees are tacked on.

Perhaps the most crucial thing these boutique-ticketing services offer is the venue’s ability to control every aspect of their marketing campaign for the performance. Managers can choose which supply channels they want to offer such as mobile, mail, phone, and in-person ticketing. Valuable customer data such as email addresses and demographic statistics can be integrated directly into the venue’s customer relationship management software.  This allows managers to pro-actively manage and market future events, thus increasing ROI and consumer engagement and loyalty.

All of these services run on a whiteboard template. Working with the venue’s marketing and design teams, the ticketing processing companies integrate the ticketing service right into the venue’s website. This ensures that the consumer stays within the organization’s space and prevents them from having to click into a third party site, a process, which increases cart abandonment rates dramatically. Once established, the venue’s graphic designers can create custom click through banners for the ticketing portion of their site that can be used as ad space, or more effectively as a way to cross-promote events, sell parking, merchandise, restaurant reservations, or anything else to increase revenue for the property.  Even the ticket stock can be pre-printed with the venue’s brand aesthetics, special promotions, or used as third-party space for ad sales revenue.

Despite these positives, not enough can be said about the power of having Ticketmaster in your corner. Due to the brand legacy it has become a first visit for most consumers seeking events to attend. Combine that brand recognition with the organization’s powerful search friendly infrastructure and any query with the word “ticket” attached results in a first place ranking on many of the top search engines. Sure many independent artists have seen success moving against the Ticketmaster grain. Comedian Louis C.K. sold a whopping $4.5 million in tickets in just 45 hours through his own website in 2012, but he still must issue tickets through Ticketmaster for venues with exclusive deals with the concert promoter, and when you are piecing together a large tour the Ticketmaster name offers you much better exposure than these boutique agencies can offer.

That doesn’t mean boutiques aren’t trying. The modern day ticket suppliers place a lot of clout in their power to enable your social community. All of these services make it extremely easy to sell tickets through spaces such as Twitter, Facebook, and Google Plus with instant fan page and link creation. For venues such as casinos who see their client base come from a small local area or small theaters who see patrons from a small sect of the local population, this type of social campaign strength can actually enhance overall ticket sales for the venue.

All in all choosing a ticketing service can be a tough decision.  It all depends on the venue, the acts you bring in and the type of client base. I would say that leaving Ticketmaster out of the loop is ill advised, their brand recognition is just too strong, but there is a lot to say about the personal attention and configurability of the new solutions popping up in the market.