Personal Finance

The Money Behind Music Festivals

The Money Behind Music Festivals
The Money Behind Music Festivals (The Money Behind Music Festivals)

It's been half a century since Woodstock, the iconic festival held on Max Yurger's dairy farm in Bethel, New York. The spirit of community and love are still central to many of the jam-filled gatherings.

We've come a long way since the three days of peace and music that summer of 1969. Music festivals have become increasingly popular.

Crowds from the mainstream are now flooding stadiums, deserts, and open rural spaces. They're bringing with them a ton of cash.

It takes years for a music festival to gain a widespread reputation and to start making serious profits. 

Culture Commodified

Big US festivals like Coachella, Lollapalooza, Bonnaroo, and Governors Ball have big-ticket prices. They book the best acts, flood the media, and major retail stores promote entire seasons of sales, especially for festival-goers.

Music Festivals are no longer a counterculture phenomenon, but they're an opportunity for corporations to make massive profits. Major conglomerates have invested in and even partially own many festivals, which allows them to continue to grow as a brand. Eventually, they become something ingrained in the culture.

Conglomerates like Coca-Cola Co., PepsiCo, Inc., and Anheuser-Busche are some of the brands that have partnerships with a basic festival. Others offer tents and special campaigns. Some companies have even sponsored their music festivals, for example, Budweiser's Made in America festival. 

Big Payoffs For Artists

Big-time music festivals like Glastonbury and Coachella pay artists six, sometimes seven figures to headline. For musicians and bands, this is a huge payoff, and they don't have to deal with the perils of touring to appear in front of a massive audience. 

Let's put the history in perspective. According to NPR, Jimi Hendrix was paid $125,000 to perform at Woodstock. This year for two days at Coachella, Ariana Grande was paid $8m, which is 64 times more than Hendrix.

Live events like concerts have become a more substantial part of the way artists earn money. While you may be able to discover new music at many major music festivals, many just go for the big acts.

Most festival-goers who attend mainstream events are there to see the same five or so songs that they most listen to on Spotify or Apple Music. 

Fashion Cashing In

Retail giants like Claire's and Victoria's Secret have clothing lines dedicated to festival season. For many influencers and wanna-be famous social media users, attending the shows may be about replicating authentic experiences for photographs and not necessarily enjoying the music.

Coachella and Burning Man are two festivals that are notable for their exclusivity. For many, it's less about 'peace, love, and music' and more about 'fashion, parties, and photographs."

The Local

Music festivals are often held in small, rural towns and communities. These events can have a profound effect on local communities. Festivals create thousands of temporary jobs and bring money through restaurants, hotels, and convenience stores. 

Niche Festivals

While it feels like the spirit of youth rebellion and counterculture have been taken out of the industry, there are still some niche concerts targeted at smaller crowds. These festivals are typically outdoors, last many days, and are relatively low budget. 

Jam bands like The Disco Biscuits and Phish have their festivals for their "cult following" fan-base. These events are intimate and bohemian. Festival goers stimulate the local economy and support smaller artists.

Unlike with Coachella and Bonnaroo, these attendees don't tend to contribute any raise in retail for their "festie wardrobe.'

People who go to these smaller festivals are into quirky gifts and setting up the trippiest campsite. They'll probably spend some cash on LED lights and these socks from iHeartRaves.

These niche festivals interact with their locales, curate authentic collaboration, and foster a community spirit. It's tricky to make money with these as they have a high overhead cost and rely on the top enthusiasm and income of patrons.

The Verdict

While music festivals are becoming increasingly mainstream, they bring with them a massive opportunity for companies to make some significant profits. People love music festivals, and economies, no matter the size, can benefit from these events.

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