Apologies are becoming way too common in the LiveWorks Newsletter, but I must again say I’m sorry to subscribers for sending an old newsletter to you. To say I’m frustrated with the situation is the understatement of the century…and if any of you know anything about FeedBurner (the service that sends newsletter subscribers their emails), please let me know. If there is an upside, as promised, at least you didn’t get the “Recession” email again. Now on to “If I were…”
It is hard for me to wrap my brain around AEG’s business. They separate it into AEG and AEG-Live. AEG invests what amounts to hundreds- of- millions in new venues around the world, while AEG-Live is the concert promotion and live entertainment company built around the acquisition of Concerts West. With all the money flying around it is hard to say how or if AEG makes any. Since they are privately owned, AEG doesn’t report their financials, so it is even harder for me to poke my big nose into their shit. So more than ever, please read the following disclaimer: The “If I Were…” series is based on not knowing what the day-to-day business realities are for those written about. Also in many situations, I’m looking at decisions from the past after they have already been played-out (or are in the middle of doing so) so it isn’t necessarily fair to play Monday morning quarterback. Oh well! Fair or not, I like playing the position, so here are some of the things I would do “If I were…Tim Leiweke”.
· MARKETING – AEG should market itself as if it were a public company. Meaning, they should start reaching out to consumers as a brand. This is a real opportunity to differentiate AEG events and venues from everyone else’s. Market in and to your communities.
· FAN RELATIONS DEPARTMENT – Goldenvoice guys should certainly be a part of this unit (just look at what they’ve done with Stagecoach’s layaway plan). Although as per above, the whole company should be behind this mission, AEG should have a department whose only job is looking after fans (sports, music, family shows, etc). With the intelligence they can share with the rest of the company, AEG’s whole culture will move into the role. Think about what you could implement.
· STOP THE BIDDING WARS – In the live music business, bidding wars do a huge disservice to fans by driving ticket prices up, and thus everything else. Create a committee to look at each opportunity and make a quick assessment of it. Adding layers of bureaucracy can sometimes actually speed-up the decision making process since every deal wouldn’t have to pass by Randy Phillips and/or Tim.
· ENERGY/GOOD CITIZEN – The new solar panels at LA’s Staples Center and the PR that went along with it is a great example of what I’m talking about. Getting ahead of the competition by switching over to clean energy, recycling, conservation programs, etc, will not only save you money both now (through tax breaks and energy savings) and in the future (it is said that “U.S. companies can spend billions now or trillions later”), it will make consumers feel better about doing business with you (this has been proven). Hire a “Green Czar” that’s responsible for these initiatives. Build it into AEG’s DNA. The changes that Wal-Mart found their “associates” have made and continue to make since the company started its greening is amazing (looking for ways to cut down on post-consumer packaging, energy saving ideas, and even eating healthier).
· VENUES – I’m sure this isn’t the first time you have heard that several of your new concert venues and theaters are feeling a little sterile. I think a better analogy might be a modern AMC multi-plex. Don’t get me wrong (or anyone else saying this), I appreciate not only the investment you are making into our business, but the thought you put behind building them (production manager’s dream, great sound, etc). Maybe your architects know something the rest of us don’t on how things will look in the future or how the venues will wear over time, but right now they could use a little more character.
· FREQUENT BUYER PROGRAM – Reward loyalty with a program that gives fans discounts on tickets, early access to the best seats, special merchandise, VIP parking without paying for it, etc. Give them a membership card with special stamps or stickers for each show, game, or special event they attend. Consumers can show their friends. Think of it like the concert T-shirt you wear to school the day after the show to let everyone know you were there. It will work with sports fans young and old the same way it works for music fans.
· THE DENVER OFFICE – AEG needs more strong local promoter acquisitions like Chuck Morris and the Denver office. In two-years, Chuck, Brent, Don, and company have not only built two new successful music festivals, they have also managed to give Live Nation a run for their money in a market where LN owns and/or controls several major venues in the market (thus the ability to offer more money in theory). Coincidentally it was Chuck and team (and Barry Fey as it relates to Coors Amphitheater) that built-up most of those venues.
· THE BENCH – Almost repeating myself from the item above but not really. For some reason there is a perception that AEG doesn’t have a deep bench. Not sure that reality matches perception (Tim, Randy, Larry, Paul, John, Chuck, Debra, etc) but it is out there. Might be time to speak with John Scher in New York, Arny and Jerry in Chicago, and more.
· BUY LIVE NATION – They should be willing to sell it right now at a real discount. Go directly to those that hold the IOU’s and make an offer to buy the company @ $7 per share. The stock could fall below $4 this week. Make your move. Stockholders like me will be really happy to get out alive and you would end at least one war.
· RESTART DIALOGUE WITH MSG & TICKETMASTER – If buying Live Nation doesn’t work out, how about trying to re-engage conversations with MSG and/or Ticketmaster? Again, now might be the right time to talk as both Ticketmaster and MSG are on the move and cash is king.
· BRANDS – We in live entertainment are just not getting it right when it comes to working with brands. AEG has a great sales team (I’m sure, never met them as I have the Live Nation team, who are also very good) for their building’s naming rights etc, but need to do even more to work across their multiple platforms (venues, local concerts, tours, sports). It is time to breath new life into our business. I bet there are some very smart marketing and branding types who are feeling rather concerned about their Detroit jobs these days. Sunny California probably looks pretty good right about…now. Bet they would work for less with a big upside too.
That should be enough to keep Tim and company going for a while. Again, please know that just as with Michael Rapino, I don’t know the realities of Tim Leiweke’s job. These are just ideas I would work towards knowing what I know, “If I were… Tim Leiweke”.
Talk with you soon,
Jim
LiveWorks Newsletter 