We are two days away from Beyoncé's Renaissance World Tour kicking off in Sweden, but according to reports, the highly-anticipated tour could earn up to nearly 2.2 BILLION dollars, surpassing Taylor Swift's Eras Tour. This would make it the most lucrative music tour in history.
via: Forbes
Those eyepopping estimates are based on the most optimistic assumptions of the number of fans buying tickets at their concerts and high average ticket prices of about $700.
They also assume the artists take home a considerable share of merchandise proceeds and pay tour expenses of 20% of revenues — leaving them with the other 80%.
“Renaissance” could gross between $275 million and $2.4 billion from tickets alone by the time it ends in September. Beyoncé’s most optimistic ticket revenue estimate — $2.4 billion — is well above Era’s $1.9 billion most optimistic box office.
Due to fans’ pent-up desire to attend in-person concerts at the end of a more than three year pandemic, using optimistic assumptions makes sense to me.
Born in Houston, Texas, Beyoncé entered the music industry in the 1990s with Destiny’s Child; achieved solo success with number-one albums (like Dangerously in Love and B’Day;) headlined the NFL Super Bowl 50 and so much more.
Odds are good “Renaissance” could be Beyoncé’s most lucrative concert tour — possibly exceeding the revenue she has earned from all her previous concerts combined.
In addition to being exceptionally talented artists, Beyoncé and Swift are excellent business executives.
A key part of the executive job is choosing a business strategy — making decisions about which products to sell, where to sell them, and how much to charge customers — and executing it flawlessly.
Both artists pursue a differentiation strategy — meaning that they charge premium prices for a higher quality product that may cost more to produce. (Another common business strategy, cost leadership — selling a good product at the lowest price with lower costs — is probably rare among performers).
The experts I interviewed — who have not reviewed their contracts — highlight some business strategy differences and similarities between them:
Swift may retain a larger share of ticket sales than does Beyoncé.
Swift has a more extensive merchandising strategy than Beyoncé.
Beyoncé and Swift have high tour expenses and their average ticket prices for their 2023 tours are around $700.
Swift probably receives between 100% and 110% of ticketing revenues. As David Herlihy, a Northeastern University Teaching Professor and Music Industry Program Coordinator, told me, “Her promoter should be happy to pay her more because he does not have to assume any risk that her concerts will not sell out.”
Beyoncé may receive close to that amount. “Beyoncé could have an escalating rate (based on number of tickets sold) or a flat percentage per ticket. Considering her prior success, she’d certainly command in the upper 90th percentile or more.” according to my May 6 email from Armen Shaomian, University of South Carolina Associate Professor, Entertainment Management.
Sponsors and other partnerships can help top artists guarantee high concert proceeds. “Beyoncé’s case sponsors include several major corporations, such as CITI, Verizon, and Tiffany. Her entire Renaissance tour production is handled by her production company, Parkwood Entertainment, and promoted by Live Nation, which drives a greater percentage of the revenue directly to Beyoncé,” Shaomian explained.
I'm not surprised by this news, especially since Beyoncé gives her fans a full visual experience with her tours. Also since she didn't release any visuals to go with her latest album, attenting this tour is definitely a must.
I'm actually curious how much money Madonna is going to make for her upcoming Celebration World Tour when it kicks off next month.
To read the full article on Beyoncé's and Taylor's business strategies, click the Forbes link up top.
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