In Australia, where Taylor Swift is expected to tour next year, government has already stepped in to prevent resale of tickets at exorbitant rates. This supply-demand gap is increasingly becoming a trend around global music tours
As globe-trotting music tours make a comeback in the post-pandemic world, pop icons like Taylor Swift and Beyonce are no longer just music or entertainment figures. With the massive crowd-pulling abilities of their concerts, these music artists have transcended themselves into economic phenomena capable of majorly affecting consumption in the cities they choose to tour.
Recently, after the dates for the Autralian leg of Taylor Swift’s The Eras Tour were announced, fans of the popular artist seemed to be in a frenzy to secure the much-coveted tickets. As soon as the first limited tranche of tickets for Swift’s February 2024 tour to Oz were officially sold out, the tickets reappeared for sale on unofficial channels with highly inflated price tags. Due to excessive demand, the tickets were finding buyers at more than double the original price—a VIP ticket package worth $1,250 was being sold for $3,114.
This even prompted the government to step in. The state governments of Victoria and New South Wales are now undertaking measures to prevent the reselling of tickets with large premiums—a practice known as scalping.
The Australian episode is only the most recent example of demand outstripping supply by a huge margin when it comes to global concert tours. This had already become a talking point among economists and policy commentators around the world because of the impact these concerts have on the host cities’, and countries’, economic metrics such as consumption and inflation.
Big Bucks And Increase In Inflation
Even as experts agree that the global economy is facing a downturn, Taylor Swift’s tour managed to spur consumption in the cities it has visited so far. The US leg of the tour alone is projected to generate economic activity of $5 billion, according to online research firm QuestionPro. This includes not just sales directly caused by the concert—tickets, merchandise, food and beverages—but also associated costs such as flight tickets, hotel bookings and other discretionary sales in host city. The star’s worldwide tour is expected to fetch her over $600 million.
Such global tours also boost tourism of host countries as fans follow their favourite artists across venues around the world. For example, when Beyonce’s Renaissance 2023 tour reached Stockholm, it led to a large increase in tourist footfall in the Swedish capital. The large influx of Beyonce fans to Sweden also had to do with the relatively weaker position of the Swedish currency and lower ticket prices. Subsequently, this demand translated to a spike in ticket prices and hotel room fares.
In fact, the surge in ticket prices and hotel rates in Stockholm had a direct impact on the inflation figures for the country in the month of May, according to Michael Grahn, chief economist at Danske Bank, Sweden.
Grahn wrote on Twitter, “Beyonce's start of her world tour in Sweden seems to have coloured May inflation, how much is uncertain, but probably 0.2 p.p. [percentage points] of the 0.3 p.p that hotels/restaurants added.” The world tour of Beyonce is estimated to fetch the pop icon upwards of $280 million.
Post-Pandemic Tourism
The excessive demand for concert tickets of leading figures can largely be attributed to the lack of such music events during the pandemic era. Now that lockdowns and safe distancing have become a thing of the past, fans are willing to pay top bucks to attend the shows of their favourite stars.
In Singapore, where Swift is scheduled to tour early next year, students have already requested the education minister of the country to grant national holidays on concert days. Acknowledging this, Singapore’s education minister Chan Chun Sing even gave a tongue-in-cheek reply.
“How about this? If any creative and enterprising fan can invite her (or any other A listers just to be fair) to your school to perform free of charge, we can have your school declare a school holiday?! Then everyone gets to enjoy this inclusive concert!,” he said on social media. For the tourism-friendly Asian country, upcoming concerts from the likes of Taylor Swift and Coldplay are expected to bring in good tourism revenue after the dip experienced during pandemic.
In Australia, as tourism numbers fail to reach pre-pandemic levels, the anticipated influx of Swifties—as Taylor Swift fans call themselves—will be a welcome change. Greg Jericho, a policy director at the Centre for Future Work in Australia, noted in his recent column: “Only holding concerts in Sydney and Melbourne means Swifties will be coming from other states and New Zealand, given there are no concerts to be held there, so that is some “export” dollars for tourism.”
TSwift Lift
The bump in economic activity that happens in every city following a Taylor Swift concert has been dubbed as ‘TSwift Lift’ by research and analysis firm CreditSights. If the trend persists for the rest of the star’s global tour, many cities stand a chance to enjoy a spike in economic activity thanks to Swifties.
Keeping the risk of the inflationary surge aside, as it is possible in only some economies, global tours of music icons will largely help boost the tourism of host countries. As such, it is likely that there will be increasing competition among countries and cities to lay claim to some of the Swift lift and Bey buoyancy that pop icons can offer to their economies.