The Festival Market Hits The Skids: Hard Times Ahead For Musicians?

2021 ended with a bang for the big music scene.

Everyone was escaping the lockdown and they wanted to party to celebrate and party like it was 1999. Music festivals were booming in response.

BottleRock and Lollapalooza, for example, saw fantastic crowds and ticket sales.

2022 is simply not delivering the same rush of blood to the festival circuit.

So, what’s going on and what’s the lowdown for musicians?

Factors Hurting The Festival Market Now

There are some good reasons that fewer people are attending big festivals and they include:

• Inflation – In 2022 the US has seen 8.5% annual inflation (when last measured) and that means people are poorer and have less disposable income to splurge on festival tickets.
  
• Labor shortages – this might seem irrelevant but the truth is that many festivals are struggling to find staff to run their shows safely. You can’t sell tickets if you can’t ensure people’s wellbeing at a gig.
  
• Too many acts on tour – festivals might be hurting but big name artists are not. In fact, they seem to have figured out that many people would rather see exactly who they want to see rather than endure three days in a muddy field to see a few acts they like. This has seen a shortage of big name draws available to play at festivals. There’s too much money at stake to do festivals.
  
• Too many festivals too – the laws of supply and demand are clear, when there’s too much supply and too little demand, you can’t sell tickets. The industry took 2021 as positive demand for festivals, so it scheduled a ton of festivals for 2022, far more than people wanted. That means festival organizers have been praying for a smaller audience to spend more money than ever before and attend more festivals than ever before. This is fairly unlikely, given the substantial time and money investment in attending any festival.
  
• Covid’s comeback – while many people have decided that “Covid is over” the truth is that there are still new variants and there are plenty of people who have made a concerted decision to avoid large groups of people. This is constraining the maximum audience available for music gigs and festivals, in particular, are hit by this. 

It was clear by the spring of 2022 that this wasn’t going to be a great year for festivals and that they might be in a similar situation as to the mid-2010s (when the Fyre Festival notoriously failed and its organizer was criminally charged for its failure). 

This has seen a large number of shows that were announced being canceled and even the festivals that have gone ahead are hurting for it. Fencing, staging, fuel, etc. are all more expensive thanks to inflation. 

Promoters say that this means an event is roughly a third more expensive to host than it was a year ago!

But ticket sales often took place without this rise being accounted for, in short, many festivals will lose money and may not be viable in the future. 

What Does This Mean Going Forward For Festivals And Musicians?

It seems likely that this year has seen the end of multi-genre spanning festivals. They’ve been most at risk of failing and there’s a clear indication of audiences responding better to more focused single genre events. 

More focus needs to be put on selling high-end VIP experiences, which surprisingly saw growth in the otherwise shrinking ticket market. As audiences grow up, they’re willing to pay for comfort such as luxury tents and air-conditioning. 

For artists, it also means being more choosy about which festivals to lend their names to.

Artists make most of their money in the 202Xs by touring and each event must more than pay for itself to be worthwhile. 

Artists who make poor choices regarding festivals to participate in risk tarnishing their brand and crowd-pulling power in the longer term. 

Final Notes 

The festival market is not dead, but 2022 sees it on life support. We think there will always be demand for big live shows featuring many acts, but that market is likely to be smaller and more focused in the future.

Artists are going to keep close tabs on developments in the festival scene to be able to maximize their own touring revenue.