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Broadcasters tap into Rs.200 crore live events market

Broadcasters tap into Rs.200 crore live events market

Author | Collin Furtado | Monday, Jul 20,2015 8:54 AM

Broadcasters tap into Rs.200 crore live events market

The live ticketing events space has started picking up in India. According to industry estimates, the market size for live ticketing events is expected to be Rs.150-200 crore. This segment is growing at over 20 per cent year-on-year said the FICCI-KPMG 2015 report. In 2014 this industry as a whole grew by 15 per cent over 2013. However, with economic sentiment turning positive after the arrival of the new government, the industry estimates the growth in 2015 to be around 30-35%. This would see the live events industry to grow to around Rs.200-250 crore.

This has caught the attention of TV broadcasters who are looking at alternate sources of revenue and provides brands a good opportunity to reach their audiences. TV broadcasters who are mostly going into this space as of now are those primarily in the music space. In the segment, there are two sources of revenue i.e. revenues from ticket sales and the other from advertiser and brand sponsorship. Currently, approximately 65% of the revenues comes from brand sponsorship, while 35% of the revenues are from ticketing. However, people in the industry are looking at this trend changing and ticket sales contributing a majority of revenues.

Jaideep Singh, SVP & Business Head – INS, Viacom18 says that an ideal revenue ratio scenario for the live ticket events would be where 60% of the revenues come from ticketing and F&B (food & beverage) and 40% come from brand sponsorship. He added, “We haven’t really gone into merchandise. As the events space evolves, your dependability on brands may decrease because you will have premium services like hotels, pick-up and drop services, etc. which are there in the international markets and is right now not existing here because it has not evolved that much. I think as we go forward the premium services are going to increase the pie or the share of F&B and ticketing. This is the space one has to move into if events have to grow because you can’t depend upon brands entirely.”

LIVE Viacom18 is one of the first in among the TV broadcasters to the take a step into this market and currently has six live properties under it, this includes, VH1 Supersonic, MTV Bollyland, Emerge, MTV Xtreme, Nickelodeon Kids Choice Awards India and Comedy Central Chuckle Festival. Each of these live events serve as an extension of the brand and establish a connect with the audience. “As far as the market is concerned I think on the ticketing front it is majorly the top 8-9 markets where the ticketing potential looks like. But in other places the ticketing range is going to be more of Rs.200-300 or Rs.500 in the smaller events. Even the big Bollywood concerts range between Rs.500-1,000. You can’t really stretch it beyond that if you want to get a good audience. Major ticketing potential is on the IP properties which are addressing the top 8-9 markets, that is how I see it,” said Singh. He further added, “The top 8 towns consisting of mostly metros can pay up a ticket size worth between Rs.1,800 to Rs.5,000. Globally also if you see the main events usually command ticket pricing starting from $50-200 (approx. Rs.3,000–12,500). So we are in the starting point today between $50-100 (approx. Rs.3,000-6,000) on average between a few properties. I think 3-4 years back it was between $25-40 and has now moved to $50-100 and is moving upwards.”

Another TV broadcaster who had recently entered into this space is 9X Media with its first live show Arijit Singh Live with Symphony Orchestra. The event was said to be a success with tickets priced at Rs.3,000, Rs.6,000 and Rs.10,000 being sold out in the span of three weeks since being put up on Bookmyshow. This was in a venue with the capacity of 5,000 seats. According to a media report  the channel is said to have generated Rs.1 crore through ticket sales alone.

Kapil Sharma, Marketing Head, 9X Media said, “There were two reasons for entering this space, since we have done Tashan Nights and Jhakaas and such events, 9XM was missing on this front which is why we got into the live events concept. To do an event that suits the stature of 9XM as a channel we had to do the event in Mumbai, Delhi, Kolkata, etc. Whether it is large metros or mini metros, the events are of large scale in nature and the artists involved are A-listers. So the cost of putting this whole event together from the venue, artist, production, TV production, etc. it becomes too expensive for us to do this event only on the basis of sponsorship revenues. That is the reason why we have done ticketing because we can collect X amount of money from tickets and X amount of money from sponsors so as to become 2X and breakeven in this entire opportunity.” 

Another TV broadcaster that is looking at entering the live events space is Disney India with their Bindass Play music channel brand.

Nikhil Gandhi, VP & Head of Revenue, Disney India said, “We are toying with an opportunity which we want to create an IP of sorts with Bollywood music or maybe with rehashed music. Currently it is very much on the drawing board so I can’t give any details about it. In terms of brands we would like to do  city tours with singers.” 

Arijit Singh Live concert attracted brands such as Welspun, Hungama, Carwale, XXX, Gionee and Ayurwin who came on board as the sponsors for the event. It also had Red FM, Hindustan Times and Bright Outdoor as promotion partners. Brand attraction towards LIVE Viacom18 has been high. For instance the Alt-J concert which was part of the Emerge IP brought in brands such as Only, Bed Head, Hungama Digital, Tuborg, Monster, Rolling Stone, Furtado’s and several other brands. VH1 Supersonic has Tuborg and Gionee two of the main brand sponsors and MTV Xtreme had Samsung Galaxy S2 as presenting sponsor.

“I think in the last two years the interest of brands in this space has increased many folds, primarily they want to engage out of the box. Doing ad spots is not something that really creates a difference, especially for youth brands and niche brands who want to engage with the consumer. And for us specifically being a broadcaster I think the synergy of digital, on-air and on-ground has strengthened the brand a lot. We have seen a growth of almost 200% in terms of the brand count now participating with us,” said Singh. He further said that brands are putting substantial budgets on the live events space and the categories that spend most include alcohol brands which at times may put 80% of their budget here, handset brands, energy drinks and even FMCG.   
“The events business is a good opportunity for brands to create experiential zones at the venue where they can interact with the audience. Each of the brands that associated with us created a zone to provide a touch and feel experience to the consumer who had come,” said Sharma.  

Dipali Goenka, MD, Welspun Global Brands Ltd. & ED, Welspun India on its association with Arijit Singh Show said, “It is a great platform for brands such as Spaces Home & Beyond to be associated with live events as it helps in connecting with the audience, showcasing our products and engaging with them. This is the first year that we have been associated with a music concert and we plan to associate with many more in the near future.”

Siddhartha Roy, CEO, & COO, Hungama Digital Media Entertainment said, “Obviously TV gives us the ability to get us to reach out to a larger community out there. It allows us to get content shot in a specific city to be available to left out places in the country. Most of this is possible through the broadcast distribution. Having said that it is these kind of innovations where we see value and where we work with 9XM to bring this inbuilt digital promise.”

Entertainment tax puts a dent in the revenues

One of the negatives of the live events ticketing space is the entertainment taxes that organisers need to shell out. According to industry experts almost as much as 25% of the revenues generated through an event can go towards the government as entertainment taxes. While in cities such as Mumbai 25%, in Gurgaon and Bangalore it is 10%, in some place in East India it is 35% and in Delhi entertainment tax had recently been increased to 40%. These entertainment taxes are taken prior to the event even taking place and charged as per the estimated tickets that the organiser is expected to sell. If the organiser doesn’t however sell that amount they end up making a loss. “I think the difference in entertainment tax across the country is a problem. Secondly a high level of entertainment tax is a big hindrance in growth of this industry. At the end the ticket prices go up for the consumer and for us also as the consumer can’t pay that much, the number of people reduces. The number of the volume reducing is also not healthy for the government also because you are actually killing the market by keep entertainment tax so high. With the numbers which India has one should be looking at a higher volume of people buying tickets and thereby having a high entertainment value coming back,” said Singh.

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