Paul McCartney, The Rolling Stones and Bob Dylan are set to perform over two weekends at the Desert Trip festival in California this October. But despite an impressive line-up of iconic rock stars – including Neil Young, The Who and Roger Waters - famed organiser Goldenvoice could be hard-pressed to turn a profit.
Before news of a second weekend of performances broke, music-business professor Larry Miller told The Wall Street Journal that Goldenvoice, a subsidiary of concert-promotion giant AEG Live, might have to rack up between $32m and $35m (£22m to £24m) in ticket sales to come out ahead. He pegged the combined cost of the bands at between $15m and $18m, and expected a further $10m in production costs, giving a total outlay of up to $28m.
If the organisers incur a further $10m in band payments and $5m in production costs for the second weekend, that takes the total price tag to about $43m. And if we assume they're still aiming to make at least $4m in profit, the new goal becomes $48m.
Goldenvoice is holding the concert at the same venue as Coachella Valley Music and Arts Festival (“Coachella”), which attracts around 100,000 young people annually with acts such as Drake and Calvin Harris. Given the Desert Trip bands are likely to draw a considerably older audience, Miller thinks the group will look to sell only 40,000 tickets each weekend to reduce waiting times and ensure a more relaxed concert experience.
The festival’s organisers have said that three-day general admission passes will cost $399, while reserved seats are priced between $699 to $1,599. Assuming they sell 80,000 tickets over the two weekends, they will need to earn an average of $600 per ticket – a 40 per cent premium to the price of a standard three-day pass - to reach $48m. The pressure will be on Goldenvoice to sell a large amount of reserved seating.
On the other hand, commemorative posters - which go for $75 apiece - and revenues from concession stands could compensate for any shortfall. And fans who camp on-site could pay anywhere between $100 and $10,000.
Moreover, Goldenvoice’s stellar record of cashing in on music suggests it may just pull this off. The first Coachella was held in 1999, yet it has already become the world’s highest-grossing music festival. Indeed, it brought in more than US$84 million in ticket sales in 2015.
The group has also been savvy in marketing Desert Trip to nostalgic ‘baby boomers’, or people born in the two decades after World War II ended. It has touted the “once in a lifetime event” as the world’s most inter-generational concert in history. Moreover, The Guardian points out that baby boomers have more money to burn than they did during the 1960s and 1970s; they may be willing to shell out to cross their favourite acts off their bucket lists. And the recent deaths of David Bowie and Prince are tragic reminders that these iconic performers won’t be around forever.