Artists can bring value beyond ticket sales on Las Vegas Strip

The glut of resident headliners in Las Vegas has forced adjustments of financial performance, say industry officials.

Britney Spears made some news midway through her run at Axis Theater (now Zappos Theater) when it was reported she was not selling out every show. No Las Vegas superstars are required to sell every ticket (though Lady Gaga and Bruno Mars, for example, consistently sell out). The model is roughly 75 percent ticket sales for a Las Vegas residency show to turn a profit.

“Look at a major hotel on the Strip as an example. You might be 78 percent capacity on a Tuesday, with no convention in town,” Live Nation President Kurt Melien says. “You’re going to be at 100 percent on a Saturday, but not every day is Saturday. It’s no different with shows. Certainly, you don’t have to sell out every show.”

AEG Live Senior Vice President Bobby Reynolds says, “There are definitely shows that I produce that have done 75 percent business where we’ve made good money, or have lost good money. It really is the deal.”

Chris Baldizan, MGM Resorts Entertainment and Sports senior vice president of booking and development, says artists who play Park Theater, especially, bring value beyond ticket sales.

“It all depends on the artist, it depends on the deal, and you can measure strictly ticket sales to find that you can pay the artist and all of the expenses associated with the show,” Baldizan says. “If you can do that, yes, that is one way we can say it’s successful. But there are so many other ways — who’s coming to Park Theater? Are they spending money on food and beverage? Are they staying in their hotel room or are they gaming? There’s not just one singular component that we look at for success.”

Success also can be measured in the tremors that rattle lower-level production shows and performers. Melien steadfastly says, “Good commercial shows sell tickets. I hear a lot of this stuff going around, but good shows sell tickets. Period.”

Still, producers in Las Vegas say that when, say, Gwen Stefani and Gaga are onstage on the same weekend, the effect is felt down-ballot.

“The net result I’ve seen around the city in smaller shows can be a 10, 15, 20 percent drop in sales,” says SPI Entertainment CEO Adam Steck, who sees all sides of the issue with his “Thunder From Down Under,” Human Nature and “Australian Bee Gees” shows and the Boyz II Men residency. “Some smaller, independently produced shows are down 50 percent. That can only be attributed to resident headliners, because there is only so much money to go around. When you have JLo, Gwen Stefani, Christina Aguilera and Aerosmith performing, it sucks the business out of a lot of middle-scale shows.”

Over the past five to six years, Cirque du Soleil shows have turned to “dynamic” pricing, offering discounts for shows experiencing soft ticket sales. That was not the case in the days when there were comparatively few superstar headliners, certainly before Zappos and Park Theater were home to Spears and Gaga.

John Katsilometes’ column runs daily in the A section. Contact him at jkatsilometes@reviewjournal.com. Follow @johnnykats on Twitter, @JohnnyKats1 on Instagram.