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FEATURE: Expensive White T?s: The Politics of Price Matching

FEATURE: Expensive White T?s: The Politics of Price Matching
Alternative Music

Recently, 3OH!3’s Nathaniel Motte penned a thoughtful, lengthy blog on his band’s website decrying the practice of “price matching.” The blog was spawned from a specific instance at a holiday radio show in Sacramento, California, where 3OH!3 were required to price their shirts at a equivalent cost to the headliner’s merch—an amount Motte and bandmate Sean Foreman deemed too expensive for their fans. The incident, which Motte describes in detail in his post, is indicative of a larger issue, one that affects bands and music fans across the board. Motte’s post raises a slew of intriguing questions: What is price matching? Why is it done? Who does it benefit and who does it harm? And, most importantly, what is and what should be the purpose of selling merch? In simple terms, price matching is a practice in which the headlining band on a tour set the merch prices. If that band sell their T-shirts for $40, every other band on the bill must comply with that price. DAVID GALEA of The Agency Group, who books Paramore, Dredg, Relient K and Four Year Strong, explains that price matching is just one element the headliner controls in the business of touring. “The headliner dictates everything from production to amount of merch items, to number of comps the support gets, to how long they play,” he says. “It is common practice for support acts to fall in line with what the headliner is dictating on any and all things—from clubs to arenas.” 3OH!3 manager MIKE KAMINSKY describes price matching as “a request from the headlining band asking the support bands not to undercut them in merch. It looks bad—and could affect sales—if one band is selling their merch for considerably less than another [band]. It’s essentially forcing a monopoly in the market for that show." The ability of the headliner to determine all these aspects on a tour is a privilege that Galea believes must be earned, and that there should be a balance between respecting the band taking you on tour with them and standing up for your own fans once you’ve built a fanbase. “Simply put, that is the right of the headliner, and they have earned this right,” Galea says. “A first-of-four [act] on a show complaining about the practices of a headliner, frankly, is inappropriate. This isn’t utopia; from the biggest band to the smallest band, this still acts as a business, and any band who tells you different is probably lying to save face.” But what if you are the first of four on a tour and haven’t yet established enough fans to earn those privileges? For a smaller, up-and-coming band, each T-shirt and album sold at a show can mean gas and food for the next day. In that scenario, being forced to sell your shirts at a higher price can mean you don’t sell any, which in turn hurts your ability to travel to the next venue. BAY DARIZ, singer/guitarist for Los Angeles band SOME HEAR EXPLOSIONS, has found that sometimes there is little thought about the fact that merch sales directly allow small bands to literally continue touring. “The money from merch goes directly into our gas tank to get us to the next city,” he says. “It's extremely important we sell enough merch to keep going. Many times people want free shirts and CDs,  and I don't think they realize how expensive touring is and how little money we really make. We don't travel with a crew, so we do all our own merch sales. We have to become salespeople as well as artists/performers,  and that's a tightrope to walk sometimes.” GRETA SALPETER, singer and keyboardist of GOLD MOTEL (and previously of THE HUSH SOUND), agrees. In her mind, merch sales serve two distinct purposes. “The income from merchandise helps to fund touring expenses: gas, food, hotels, van/bus servicing, flights, salary, etc,” she says. “If you love a band and want to see them live for many years to come, you should feel great about buying merchandise directly from the band after the show.” Additionally, merch sales have a more lasting, impactful purpose. “Merchandise is a way to own a tangible piece of the music you love and the event you attended,” she continues. “In this MP3 age, it's so easy to fall in love with a song and then let it disappear. However, if you own something tangible—a T-shirt, vinyl, a poster, a CD—it's harder to forget that song, that band and that amazing evening you had at the concert.” This circles back to Motte’s original point. In his blog post, he writes of price matching, “the thinking is that the main acts do not want to be ‘undercut’ by opening bands that may be selling their merchandise at a lower price, and thus offer a more attractive deal to fans.” Ultimately, though, a fan isn’t usually just looking to score any random band shirt. Fans come to shows with extra cash in hand looking for the shirt of a specific band. It’s up to the openers to win those fans over musically and hopefully acquire new fans and sell merch of their own. “The purpose of selling merch, first and foremost, is to give fans of your music something tactile that they can wear in pride and bring home a little piece of you with them,” Motte told us. “I remember when I would go to shows and my favorite thing was spending extra money on shirts and I would wear them to school. That was my money and my thing and it was my badge of honor to wear that.” "If I care about selling high quality goods and spend a lot of extra money to print on a nicer shirt, or maybe on a shirt made in the USA, there are extra costs there,” says Kaminsky. “But then you'll have some bands who just want to pump out as much volume as they can. When the two shirts are side by side behind a merch table, it may not be obvious that one is high quality and one is cheap junk. But kids learn which bands take care of them and which are more interested in peddling junk, and free market policies would theoretically equalize prices and sales." Price matching aside, who makes the decision about how much a T-shirt should cost at a show? Generally, a band and their management set the prices together, taking various factors into consideration. EMILY WHITE of Whitesmith Entertainment, who manages Gold Motel and Brendan Benson, explains that, for the most part, the prices are practical and based on what they hope is a fair business model. “Merchandise prices are ultimately determined by the price per unit—what it costs to produce each item,” White says. “We also factor shipping into the equation… I also consult our merchandise companies for what is working across the board and our interns on what they think is a reasonable price and solid value from a student perspective.” Another factor that comes into play when determining the price of merch is what is called a “merch cut.” Each venue or promoter of a show will charge an artist for their right to sell merch. The percentage that a promoter receives at the end of the night varies and changes each night on a tour. According to Motte, that percentage usually ranges from 15 to 30 percent of the total merch sales on a given night. Some venues will take a smaller percentage of the CD sales specifically since they know the band isn’t making much money from those. Merch cuts, therefore, can also affect merch prices and can mean that a 3OH!3 T-shirt at a show in Denver could cost more or less than that same shirt at a show in Chicago because the band is forced to compensate for the merch cuts. "Merch pricing has gotten pretty complicated in recent years,” Kaminsky explains. “As bands started to request higher and higher guarantees, venues started to ask for a portion of sales in the venue to make up for it. In big rooms the house cut borders on the ridiculous; sometimes 40 percent or 50 percent of the gross sales go back to the venue before the cost of the merch or shipping is even taken into account. That's why you'll see some artists selling shirts for $50 or more inside arenas. The quality of merch varies widely too— as a band, you can buy a shirt for $3 or a shirt for $12, and that cost needs to get passed on. Ultimately though the price is determined by whatever the band thinks is fair market value." Promoter SEAN AGNEW of R5 Productions finds that this practice hinders the process of booking bands more than it helps. “In the 15  years we have been doing shows, we have never once taken a percentage from a single band. I guess the general theory is that they are setting up a ‘store’ in your venue and you are charging them a fee, or ‘rent.’ I am proud to say that when I toured with bands myself– I have generally been able to sneak, lie and scam our way out of most merch percentages across the country. Generally speaking the people come to the venue to see the bands play and if it wasn’t for the bands the venue wouldn’t be making any money on the night.” Sneaking, lying and scamming isn’t always possible or ethical, though. So bands are forced to pay out significant amounts of money that they need to survive as a touring act. STACY MICHELLE WARONKER, who has sold merch for bands like Dredg, notes that while a venue technically has no say in your merch prices, their cut can directly affect how much a fan will be forced to pay for a shirt or poster. “Sometimes they take such a high percentage that you're basically forced to up your prices to ensure that the band is making profit from the sales,” Waronker says. “I experienced this at one venue in 2009 where the building was selling and taking a 20 percent cut plus 9.5 percent tax. So basically 30 percent off the top was going straight to the venue, and we were forced to raise our prices for the show. This specific venue sold merchandise for all of the bands on the bill, so they knew exactly what our income was and didn't cut us any slack when we settled.” ERIC BINION, merch manager for Circa Survive, who also works as a promoter when he’s not on tour, agrees. “It’s up to the band and their merch company to determine the price that they want to sell it for, but if you're playing an arena where they're taking a 30 percent cut plus tax, you might want to bump up your prices. This is why you see $35-plus concert T’s.” He adds, “There are a lot of factors that go into determining [merch prices]. There are a lot of middlemen and factors that most people don't think of. First you have to pay for designs, then the printing of the actual product. After that you have to pay for shipping to get it to you. Then you have to hire a merch person to sell it for you and handle all road-related merch duties. After the sale you have to give your cut to the venue. Then don't forget about your manager and/or your record label's percentage—if you have a merch deal with them. As you can see, there is a lot that goes into it that most people don't even think about.” With all that in mind, is price matching fair? Who does it help? “I’m a believer in price matching, as it’s become somewhat of a necessary evil as merch sales have become exponentially more important to bands with declining record sales,” Galea says. “What I don’t agree with, in most cases, is limiting the amount of merch items a band can sell, which also has become common practice. Basically, overzealous bands have taken what was common practice in large ballrooms, theaters and arenas, and brought it down into clubs, which I don’t feel is appropriate, and don’t endorse, whenever possible.” White also notes that price matching can help create cohesion and unity on a tour. “I think it's important from a camaraderie standpoint,” she says. “It's nice to show a unified front at the merch table and not gouge or undersell the other artists you're on tour with. In general this isn't much of an issue as most artists that tour together have likeminded fans that are used to certain prices for T-shirts, music, etc.” It’s easy, then, to assume that price matching is something supported by booking agents and managers like Galea and White, as well as larger bands who have earned the “right” as headliners, and that it’s frowned upon by smaller acts. But 3OH!3 have spent little time as an opening band and have rarely been asked to price match. Their runs on Warped Tour, the AP Tour and several co-headlining tours have been positive experiences, and at no point have they been instructed on their merch prices. Their opinion on this issue is less from personal experience and more from personal beliefs—which is something their own booking agent, GABRIEL APODACA of The Agency Group, stands behind. “3OH!3 have always tried to be respectful to their fans and keep ticket and merch prices as low as possible, as they are very aware of the economy and are grateful knowing that a fan can spend their money anywhere, but chose to spend it to see them or wear their merch,” Apodaca says. “I think Nat and Sean have always tried to be honest with their fans and communicate with them, so they understand why things are they way they are, which is why I have the utmost respect for them.” “We’ve had other bands support us on tour, and we’ve never asked them to price match,” says Motte. “We don’t think it’s right. We don’t think it’s right for the fans, first and foremost. And we don’t think it’s right for the opening bands. They have a right to sell shirts and whatever their merch is at whatever price they want. At the end of the day for us we have confidence that we’re going to be able to sell what we need to sell by the end of the night, and if kids like our shirts they’ll buy our stuff. Hopefully they do like the opening band too,  because that’s why we bring them with us. Hopefully they sell a lot of merch too.” alt
Source: Alternative Press Magazine

FEATURE: Expensive White T?s: The Politics of Price Matching

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