Inside The Business of Providing VIP Fan Experiences
In this interview Andrew Tenenbaum the co-founder of Future Beat, accompany which deal providing mega-fans with a range of specialized concerts and events. Here Andrew discusses the company and what he's learned from two decades of experience in the industry.
Guest post by Rick Goetz of Music Consultant
Andrew Tenenbaum is a co-founder of Future Beat, a company that provides super-fans with a wide array of unique experiences at concerts and events around the globe. Future Beat works directly with artists to develop exceptional packages that include the best seats, VIP amenities, exclusive and original merchandise, meet-and-greets, sound checks and more. Andrew has over two decades of experience working as a manager with celebrity clients including comedians Billy Crystal and Robin Williams, the Estates of The Beatles, Frank Zappa, Marvin Gaye and Elvis Presley and many others. Andrew is also a founder and partner in several entertainment-related businesses, including Dreamcatcher Events LLC, which produces once-in-a-lifetime rock and roll camp experiences, , AnnLanders.com, and Maddalena Tenenbaum Productions, LLC, a producer of reality television programs for networks like Syfy, TVGN and more.
I spoke with Andrew about how his company works to bring fans and artists together. He also shared his thoughts on how the industry has shifted away from products and towards experiences as well as why artists need to connect personally with their fans in the modern music business.
Thanks for taking the time to talk, Andrew. What inspired you to start Future Beat?
It’s a good story that I love to tell. About seven-ish years ago, I had some merchandise deals with Signatures Network, which, if you don’t know, was responsible for the Robin Williams comedy tour and some other big tours. So, I was working on the Robin Williams, Billy Crystal and American Idol tours and had hired Signatures to do all the merchandise. Through this experience, I got introduced to the then new idea of doing VIPs and meet-and-greets. My Future Beat co-founder, David Berger, was running the VIP department for Signatures at the time, which is how we met.
David did these first three programs, and they were phenomenally successful. Robin, in particular, tremendously enjoyed meeting fans. As a matter of fact, I went on the road for part of the tour, and at one point, Robin turned to me and said, “I don’t know why I haven’t been doing this forever. This is terrific.”
I said to him, “You do know you’re getting paid for this?” His response was, “Wow. I forgot!” Robin was a really great example of a guy who just had a great time meeting his fans, so these experiences were an amazing fit for who he was as a performer.
The two other tours were also great fits, because American Idol was corporately owned, so the supplemental income was a big perk for them. And Billy Crystal had a great fan following, so there were a lot of people who really wanted to meet him.
These experiences made me realize this was really an emerging business. Then, about four and a half years ago, Live Nation bought Signatures, and David Berger told me he was looking to make a career change. I asked him if he would consider leaving there so we could start Future Beat, and he did. In 2012, we did six tours. In 2013, we did 55 tours. And then after that, it kept building: 80 tours; 85 tours. This year, we’ll finish out somewhere around 120. And really, I think the reason why it works has a lot to do with that initial success that I saw.
Before starting Future Beat, I really realized there were a lot of uber-fans out there that really have a desire to pay premium dollars to meet the artists and get a great seat, plus have a premium experience. We fulfill that desire for those fans.
The first time I even heard or thought about VIP fan experiences was when David Freese of Nine Inch Nails released an album and offered different VIP packages to fans as part of it.
What do you and David do at Future Beat? Obviously you both oversee the company, but are you in charge of the nuts and bolts?
Well, good question. Berger eats, sleeps, drinks and breathes VIP, so he knows it inside and out. If you name him any artist, he knows every artist, brand, and fan base so well that he can tell you instantly, “This is one where we’re going to do a VIP package. We’ll do a meet-and-greet package, maybe a separate front row package …”
Or he’ll say, “Here’s one where everybody has to be treated the same,” or “Here’s an artist who won’t be so interested in meeting fans, but we could do our VIP program and claw back the best seats from the scalpers and make sure these things don’t end up on the secondary market.”
David runs the shop and the day-to-day. He knows how to set those prices and craft each package individually for each artist. My role is much more strategic, so I deal with finance, legal and the big picture.
Speaking of the big picture, how are the third-party ticketing issues impacting your business or the business as a whole? You likely have a very unique perspective on what’s going on for both VIP and normal ticketing.
You’re talking about StubHub, Barry’s Tickets and those types of companies. We are an artist’s defense mechanism against that, because scalpers don’t make a huge business out of selling anything in the third balcony, or the way back of the arena. A scalper’s business is made primarily on the best seats. And we control those for the artist.
For a bigger act, scalpers may have additional inventory, because people just want to get in the door when they are looking to go to a major show. Still, if scalpers lost access to the best seats, they’re pretty much out of business.
At Future Beat, we get access to the best seats, because in partnering with the band, the band then has the prerogative to purchase or put holds on a large block of seats. They can put holds on best ones in the house, usually the first five rows, but sometimes the first ten, to 15 rows.
That takes the inventory away from those third party scalping platforms. So, if we partner with an artist, you’re not going to see the best seats available to the scalpers because the bots can’t go out and retrieve them. They’re not available for sale. The artist then has the benefit of the profit on those sales, and it stops the bots and the scalpers from taking money out of the artist’s economic ecosystem.
I read not too long ago about the Pixies lamenting the fact that their tickets were $30, but nobody could get into a show for under $350, regardless of the seat.
This drives artists crazy, because that’s their money. The scalpers are taking a lot out of the artist’s economic ecosystem. Essentially, because you have this imbalance that exists between artists not wanting to gouge the fans, they don’t want to charge too much, and that goes even for the top echelon of seats. You have to praise the artists for not wanting to overcharge their fans.
However, in terms of economics and the laws of supply and demand, their fans are willing to pay a lot more than the artists are willing to charge. The artists are good guys, but there are some bad guys who become scalpers and make a market where they have fans who are willing to overpay.
At Future Beat, we step in alongside the artists we partner with and claw back that inventory so tickets don’t go to scalpers.
What kind of price points do the VIP packages you sell have?
At the low end, there are some brand new artists going out on their first or second tour. That could be GA shows that we will price an early access deal. So you’re getting in the door early for a general admission show lets you get up front, go backstage and meet the artist.
And those kinds of packages we’ll do sometimes as low as $59, though more likely we will charge $99. There’s a sweet spot of experiences that go for between $200 and $350. Then, we have some really high-end tours that go for over $2,000 per experience.
I would imagine that in some cases, it’s hard to qualify these experiences and that some of the super-fans who can only afford lower-end packages. Because, the higher-end packages are probably not accessible to your average working guy.
Super-fans and affluent people are often willing to spend money on a VIP experience. In the 70s and early 80s, when I was going to a lot of concerts, you could get in to see someone like the Allman Brothers for $8.50. We have a lot of people paying for experiences who are between 40 and 65. They have more discretionary money in their pocket, and they’re willing to go see a band because they have been a fan of that band for 40 years.
Thanks to Future Beat, with a little discretionary income and opportunity, you can get behind the velvet ropes. You can actually meet those bands, which is a huge, huge deal. People are willing to spend money on that experience, and on many tours, they’re actually looking for it. When these opportunities don’t present themselves, some uber-fans actually get upset, because they’ve come to expect it.
There are some people out there who lament the lack of mystery in their artists now that we have so much access to them. There are, of course, people who lament cell phones, so we have to take that criticism for what it’s worth.
Obviously, you’ve figured out the economics in a way that makes this process worthwhile for the artist, which is fantastic. But how do you feel all this access to bands and artists affects the market price and artists’ income? Is the mystery gone?
This is an interesting question. I’m in my 50s, and when we were growing up, we didn’t know much about the artists we followed. There was a record that came out, and maybe you read something in Rolling Stone magazine, maybe there was a rumor on the radio and maybe you knew the lyrics or transcribed them … but otherwise, there was a lot of mystery.
Nowadays, what do you get? You know absolutely everything about an artist, because it’s blogged, tweeted and Facebooked. I think we live in a world where that mystery is gone away, so giving access through these VIP experiences doesn’t change things much. My 17-year old daughter reports to the family every morning about where Justin Bieber was the day before.
From looking at your website, it seems like rock acts seem to participate in VIP experiences more than other types of artists. Is this true, and do you think there’s a reason behind this, or is it just circumstance?
I think the leading area is definitely heritage rock acts. You talked about the ones you see on the website, the Doobie Brothers, Iron Maiden, REO Speedwagon, etc. I think the VIP packages work really well for them because they certainly have a very, very dedicated and loyal fan base that has been following them for, in some cases, more than 40 years. When you’ve been a fan for that long, you want to meet the band.
I think these bands understand that the fans have that desire. There are super-fans attached to these acts, and high-end experiences have become an expectation. They want it, and the bands are willing to offer it.
Another genre that works really well with VIP ticketing is hip-hop. This is interesting because, while the heritage rock bands all came up in the 60s, 70s and 80s, the hip-hop acts grew up in this millennium. Despite the age difference though, they’ve come to the same conclusion. In the hip-hop world, those artists have a day-to-day, hour-to-hour, minute-to-minute relationship with the fans on social media. Because of this relationship, fans want to meet them.
I have a story that illustrates super-fandom really well. My college roommate emailed me a photo of himself backstage with Roger Daltrey. Meeting him was a big deal, because in our dorm room at George Washington University in the early 1980s, we listened to a lot of The Who. Meeting Roger Daltrey was a big deal to him. He sent a picture of himself with Roger Daltrey, but he didn’t send a photo when his kids were born. That says a lot.
It certainly does. It seems like a lot of what you do is about just simple access, but I also see a lot of these heritage acts with insane offerings. I didn’t see KISS, but I know they have a rabid fan base. I heard they have actually sold a coffin to some of their fans. How do you handle merchandise, and what have been some of the biggest draws for fans?
We design and manufacture all of our own VIP merchandise, so any of the merchandise that comes with our packages is totally exclusive. It’s not for sale online. It’s not for sale on the artist’s website. It’s not for sale at the merch stands. The acts often want to do something really cool.
For example, we worked with Ozzy Osbourne and made up custom Ouija boards. He was really into this. So, we got an Ozzy Osbourne-branded Ouija board, which was pretty cool.
And for a Ringo Starr tour, we had a three-dimensional figurine of Ringo made up. It’s an exact replica of Ringo crossing Abbey Road from the Abbey Road Beatles album cover, and of good enough quality that you can put it right up on a shelf in your living room.
Berger also had something made up for a Roger Waters tour. He made an actual replica brick in the wall. Again, it was something you could put up in your home.
With all tours, the artists and their management work with us directly so they get total approval on all merch. Most of it is t-shirts and sweatshirts and things like that, but other times they have particular ideas they want to do that are outside the norm.
With the way music is being consumed now, do you think this VIP service is going to be viable in 20 years? Will all the exposure and access fans are getting to artists make any of this less iconic? I wonder if the business is going to function in the same way, and whether the iconic images and graphics will be too familiar to make them unique.
I got a similar question at the IEBA convention in Nashville where I spoke a few weeks ago. One of the people in the audience interrupted me with a great answer that I think summed it up perfectly: A lot of the consumer world has shifted away from “things” to “experiences.”
So, in that regard, we’re right on top of the industry right now. We’re selling an experience of something – a lifetime experience. What we are doing does not revolve around things. While people love great t-shirts, sweatshirts and prints, they can take this merchandise for granted. It’s the experience that is priceless.
This person in the audience at IEBA made the same point. If you look around at everyone selling tickets right now, you can see the same concepts. Selling experiences is what casinos try to do and what the NFL, Major League Baseball and the NBA try to do.
I can see how that has been happening in comedy, which is one of the places you started. How often do you see a Louis C.K. shirt? It’s all in the experience. And products must be somewhat hard to monetize for comedians.
It’s a little different on the comedian’s side. We’ve worked with a bunch of comedians. Most comedians, first of all, don’t tour like musical acts do. They don’t go out and do 30-50 shows in a row. Comedy is typically about just continuing to add weekends. Very few artists can set a proper, routed tour.Billy Crystal, Chris Rock, Louis C.K. are some of the comedians who can do a routed tour. It works a little different for comedy but we do that all the time, though.
I know, comedians are every bit as big for VIP as musical acts. Chris Rock has got to be one of the biggest stars in the world, right? Meeting Chris Rock is a big deal.
What would you say your biggest business challenges are right now? What makes your job difficult?
The number one thing that’s always the biggest challenge of us, and I believe we get it right, because we have to do it absolutely exactly perfect without exception, is customer service. That’s because we deal with people who are paying premium prices.
When you have people paying a premium price for anything, whether a hotel room, a first-class seat on an airplane, office space, high-end retail, or anything else, you have to handle any customer service requests that come in perfectly, absolutely perfectly. And for us, I think our track record speaks for itself, because we have so much repeat business.
We have so many more tours than anybody else because we have a full-time, 24/7 customer service staff. People want to know where their stuff is, when it’s being shipped … or are asking us to resend them the instructions of where they have to go after a show to get backstage and what the rules are. Every artist is different, so you have to get this part exactly perfect. So, dealing with customers perfectly becomes our biggest challenge.
You obviously work with a lot of artists and bands that have phenomenally successful careers and have seen them performing, backstage and in other scenarios. In your experience, is there a trait they have in common that has led to their success?
That’s a great question. I feel that every one of them is completely and uniquely different. In the music world, you have some people who are just great, great players. For example, I worked with a jazz artist by the name of John Pizzarelli for a lot of years. I still go to his shows, and I’m just astonished at the way he plays a seven-string guitar! I think it’s his playing that has led to his success.
As another example, you go see KISS, and those are just fabulous showmen. I don’t know anyone with a better power show than KISS.
And then you have your Neil Young types that are about great music, but there’s also a message there. And that’s been important to them and their fan base. So I think it’s all over the map. Everyone is completely different.
I’m sure you get introduced to a lot of young people going into the music business. I do too, and I think the common thread between those who never make it and those who are successful is hard work. Have you ever met a really successful artist who said, “Hey, it’s amazing! I only have to work on this an hour or two a month”? Probably not.
Every artist is different, and what they do is totally unique, but boy, do they have to work hard at it.
To learn more about Andrew Tenenbaum and the work he does with artists and artist VIP packages, visit the Future Beat website.