Slipknot…or Not: Applying Stakeholder Management Theory to Entertainment Venue Booking Decisions

Philip C. Rothschild
Missouri State University

Abstract

The attention grabbing headline on the cover of Billboard (Waddell and Peoples, 2010) summarized the current pressures facing live entertainment, and the venues that host these shows: “Cruel Summer: Tickets Sales Down, Tour Dates Cancelled, Can the Concert Business Bounce Back.” Emblematic of the woes facing the concert business, industry executives reported that 13 of 32 shows on the Lilith tour were cancelled due to soft ticket sales. The world’s largest promoter, Live Nation, also reported a 12% decline in unit (ticket) sales in the first half of 2010, while also warning investors that ticket sales could be down as much as 15% in the second half of 2010 (Waddell & Peoples, 2010). Experts point to a “perfect-storm;” placing blame on the economy, poorly conceived tours, high artist fees, inflated concession prices, and exorbitant ticket charges. Regardless of fault, when shows are cancelled, or ticket sales are soft, entertainment venues lose much needed rental income, concession fees, and ticket fees. Under these conditions, venue managers may be tempted to shore up their financial situation by booking events that are based on reactions to short-term needs – real or perceived – rather than established booking priorities. While touring and routing schedules and unexpected championship athletic tournaments require some degree of booking flexibility, failure to use a systematic process to consider both internal and external constituents in a measured way can have devastating effects on social, political, and economic gains for the venue.

The purpose of this paper is to introduce a framework for classifying and managing divergent constituent’s interests to those who book entertainment. After reviewing a real life scenario of a concert booking decision “gone wrong”, the author gives a brief overview of stakeholder management theory and summarize definitions espoused by management theorists. Using a model described by Savage et al. (1991), four major types of stakeholders are explained. Next, the paper discusses stakeholder influence and the potential for threat or cooperation. Issues related to power, urgency, and legitimacy are discussed, along with a classification system for placing stakeholders into supportive, marginal, non-supportive, or mixed blessing categories. The paper concludes with an application of the five questions of stakeholder management theory to the process of venue booking decisions.

Keywords: stakeholder management theory, entertainment industry, music industry, venue management, live entertainment, entertainment booking

Rothschild, Philip C. “Slipknot…or Not: Applying Stakeholder Management Theory to Entertainment Venue Booking Decisions.” Journal of the Music and Entertainment Industry Educators Association 11, no. 1 (2011): 147-159.  https://doi.org/10.25101/11.6

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