Management vs Touring Agency: Which Are You Ready For?

Marcato Artists receives numerous artist submissions each and every week, and our booking division has to pass on the majority of them.  Why is that?

Many artists who submit do not yet have U.S. ticket sales history, and thus are not bookable nationally. These artists need to either represent themselves, or develop their touring career with a manager, to first prove that they can sell tickets.

THE OLD MODEL

Far too many artists believe in the ‘old school’ model of a touring career.  If you got an agent, and you had a good show, then you got booked!

That’s the 1986, 1996, and maybe 2006 model. (It’s also how cruise ships & corporate events work…but NOT touring gigs).

It’s just not how the touring market works anymore.  Having a good show doesn’t get you booked. Being a ticket draw does.

People don’t take chances in entertainment the same way.  They don’t “explore” in the way they used to.  Entertainment is highly individualized now.  TikTok, video games, Netflix, the pandemic—these all changed consumer behavior, and how venues attract ticket buyers.

A SHIFTING OF RISK FOR LIVE TOURING

If you are willing to rent theaters yourself (often called “four-walling”), you can book as many shows as you want! The organization that “puts up” the money for a concert is called the promoter.

If you take on the role of promoter for your own shows, you can book shows anywhere.

Some PAC venues are also promoters—they will “buy” a certain number of shows each year—but many venues have moved to being rental houses only. That means they will happily host your show at their venue—if you pay them like a promoter would.

In fact, the majority of ticketed events in large theaters are handled by outside promoters. (Ever heard of LiveNation?)

The promoter puts up the artist’s fee, rents the venue, and keeps the profit if the show sells well (and loses money if it doesn’t).

Some small PACs do book and promote their own seasons—and that’s who we (currently) sell to at Marcato Artists. But what artists don’t realize, is how extraordinarily competitive those slots are. These PAC buyers routinely pass on 98-99% of the shows pitched to them. Why?

Because they are looking at thousands of shows in the market, and choosing the 8-10 shows that will sell the most tickets to their patrons.

For reference, it typically costs a venue $4k or so (in venue overhead, tech cost, and marketing), just to put on a show, plus the artist fee—so it costs anywhere from $8k to $15k to put on a show, even for a small venue. To make any money, they have to sell at least 300-500 tickets (with average tickets being $30-$40 nationally). Many artists who are seeking an agent, have not yet sold 200 tickets in multiple markets, let alone 300-500+ tickets.

So, if you want to be what they book, you must prove you can outsell the thousands of other shows also on the market.

It’s similar to record labels. Decades ago, record labels signed artists based on their ‘great sound.’ Now, labels sign people based on their streaming and social numbers.

In the modern music industry, artists have to prove commercial viability, not just artistic excellence.

MANAGEMENT:  HOW WE CAN STILL HELP YOU

We’ve been focusing on the challenges for artists trying to break into touring. But our company also works in artist development & management, which is that process of developing an artist’s commercial viability. To understand this, let’s use an analogy.

We like to describe the “booking” side of our business as a grocery store (credit to my friend Ron DeStefano for that!).  With our booking agency, we “stock the shelves” with shows that already sell tickets well. We also look for similar shows to sign. 

If shows aren’t selling, then we stop putting them on the shelves, and turn away similar shows.

Using the grocery store analogy, let’s say many of our customers like Greek yogurt.  If a new brand of Greek yogurt pitches to us, we may try it, since our customers love Greek yogurt.  And if you pitch us Icelandic yogurt (which exists in America), we might try that too.

But if you pitch us Finnish yogurt (look up “Viili”), we’ll likely pass, regardless of how good it tastes. We aren’t going to invest our resources to pitch something with no proven U.S. market demand.

But this is where our management division can help.

See, it may be that with your skillset, you could develop a new Greek yogurt that we might want to sell. Or maybe your skillset would make you really good at kombucha, which sells well for us.

Or maybe, your Finnish yogurt would actually sell—but in a farmers market, not our grocery store—and we know buyers there also.

Or maybe you just need to play much smaller rooms to develop your ticket history, and want our help pitching shows that do not fit our booking agency’s model (i.e. the fees are too low for us to work on commission).

These are all situations in which we can work with you as management, just not strictly as a ‘booking agent.’ The key difference is that our booking agency signings are commission only, while our management relationships are a fee + commission, and thus involve more direct involvement with the artist than just being a booking agent does.

HOW MANAGEMENT AGREEMENTS TYPICALLY WORK

Managers have a far more involved role than a booking agency, in an artist’s career, and thus generally are a higher percentage and cost than an agent.

For many artists, as much as 30-35% of their earnings goes to management companies and agents, as these parties fulfill multiple—and very different—roles, that help make the artist successful. (It takes many different people to develop a lucrative national brand!)

Further, while managers typically receive a modest retainer fee, this is typically a tiny fraction of what the manager expects to earn once the artist’s career takes off.

Here are some examples of how management deals are structured:

• One small company we know charges their artists an annual management fee ($5k-$10k), plus 20% commissions on all income. 

• Another company has a ‘minimum booking level’ required.  Specifically, if you don’t sell as well as the rest of their roster, you pay them the commissions they would have received, for their time pitching you (may be up to $40,000 per year).

• A third company we know charges a cash payment up front ($20k+), which is recouped against future commissions (20%). Meaning you pay $20k up front, but then don’t owe more commission until you’ve earned at least $100,000 from their help. So it’s an up-front ‘development’ fee.

We follow a hybrid approach of all three.  To work with us on management, we first define the scope of work, and estimate the level of involvement that you need from us.

Based on that involvement, you pay us an annual retainer (commonly $10,000 per year, but can be more or less depending on what you need from us) which is then recouped against future management commissions owed. 

And what do we do as your management? We’re deeply involved in your strategy, planning, and development, including your go-to-market strategy for PACs.

It’s a very different role than just putting you on our grocery store shelf. Let’s look at one recent success story.

A MANAGEMENT CASE STUDY

We worked with a female vocalist who was successful in cruise ships and wanted to launch her new show “Broadway and Beyond” for PACs. This show was great artistically, but it was a poor ticket draw (too generic).  We could not sign that show as a booking agency, so we signed that artist to our management side.

First off, we spent time coming to really understand the artist and their strengths, their long-term touring & career goals, their social media appeal, and where their skillset might best align with what does sell in the PAC market.

After months of discussions, we repackaged that artist’s show into a new product called “The Sound of Julie,” a celebration of Julie Andrews, which matched the artist’s existing affinity for musicals (The Sound of Music, My Fair Lady, and Mary Poppins were all already included in the artist’s show, “Broadway and Beyond”).

Then, drawing on the artist’s natural connection to children and family audiences, we also developed a tie-in for the buyer to involve local children’s choirs in the show, which further increased the artist’s reach (and ticket sales potential). Buyers loved the idea, and the show was very successful. We were even able to use parts of the artist’s existing EPK for the new product. 

The full process of this repackaging was well over a year of effort, but the repackaging alone led to nearly $100,000 of bookings in the first year, and many more buyers interested for upcoming seasons.

So that’s one example of the return an artist can get on working with management on their touring career.

IN SUMMARY

If you are already selling 300+ tickets per date in the U.S., and want to play the performing arts center market, then we’d love to work with you on the booking side!

But even if you haven’t yet—you’ve still come to the right place, if you want to invest in creating a long-term touring show for the U.S. market.

We’d love to hear from you. Use our Artist Submission link to tell us more about your background and your show, and let’s talk!