Dynamic pricing, Oasis ticket sales and Consumer Law
2nd October, 2024
Dynamic pricing, a strategy that adjusts prices based on demand and other factors, has sparked controversy in the wake of Ticketmaster’s handling of Oasis concert tickets. As consumer disappointment mounts and regulatory scrutiny intensifies, important questions about fairness and transparency in ticket sales have emerged.
What is Dynamic Pricing?
Dynamic pricing refers to the strategy of adjusting the price of a product or service in real time based on consumer demand, time of purchase and other external factors. It is most commonly used in the transport, hospitality and live entertainment industries where the price of an event will increase as the event date approaches or as demand spikes.
Oasis, Ticketmaster, and Consumer disappointment
The use of dynamic pricing by Ticketmaster for Oasis’ highly anticipated stadium tour last month left many consumers angered and disappointed. It subsequently put dynamic pricing in the spotlight with consumers and regulatory bodies in the UK. By way of background, Oasis concert tickets were advertised in advance of their sale on 31 August 2024 with standing tickets advertised at £148.50. However, when customers eventually reached Ticketmaster’s online check-out, the price of some standing tickets had risen to over £350 and customers were left with little time to purchase the ticket and decide whether to accept the increased price. This pricing strategy is not automatically unlawful in the UK but it must be carried out transparently without misleading customers.
Consumer Protection
The Consumer Protection from Unfair Trading Regulations 2008/1277 (the “Regulations”)* protects consumers from “unfair consumer practices”. Unfair commercial practices are defined in the Regulations as:
- Those which are not professionally diligent and which materially distort the economic behaviour of the average customer;
- Those which mislead consumers in relation to matters such as the price or the manner in which the price is calculated, which in turn causes or is likely to cause the consumer to make a purchase they would not otherwise have made;
- A misleading omission, such as hiding material information or providing material information in a manner which is unclear, unintelligible, ambiguous or untimely; and/or
- Those listed in the schedule of the Consumer Protection Regulations.
The CMA Investigation and what it means for the future
On 5 September 2024, in response to mounting complaints against Ticketmaster in respect of the use of dynamic pricing, the Competition and Markets Authority (CMA) announced that it would investigate whether the sale of Oasis stadium tickets by Ticketmaster breached consumer protection laws. The CMA will specifically consider whether or not:
- Ticketmaster engaged in unfair commercial practices under the Regulations;
- consumers were given clear and timely information stating that tickets could be subject to dynamic pricing, how this would operate and the price they would pay for the tickets; and
- consumers were put under pressure to purchase tickets within a short period of time and at a higher price than they understood that they would pay.
The CMA’s investigation is still in its early stages and it is continuing to gather evidence from various sources (including via an invitation to consumers to submit evidence such as screenshots of the ticket purchasing process). However, once concluded, the CMA’s findings could have far-reaching consequences not only for Ticketmaster but for the ticketing industry in general. If the CMA finds that dynamic pricing creates unfair consumer practices, it could result in new regulations governing how tickets are priced and sold. This might include more transparency around pricing algorithms, caps on price increases, or restrictions on the use of dynamic pricing altogether.
A crackdown on dynamic pricing could also open the door for competitors to challenge Ticketmaster’s dominance. Smaller, independent ticket sellers could potentially thrive in a more regulated environment where transparency is prioritised. However, such changes could also face pushback from event organisers and artists who benefit from the increased revenue that dynamic pricing can bring, especially for high-demand events.
*The Regulations are due to be revoked and replaced by the Digital Markets, Competition and Consumers Act 2024 by the end of 2024.
If you would like any further advice or guidance in relation to the above, please contact Susan Honeyands or Lucy-Beth Pearl.
Please note that this briefing is designed to be informative, not advisory and represents our understanding of English law and practice as at the date indicated. We would always recommend that you should seek specific guidance on any particular legal issue.
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