Listen Up as we explain dynamic pricing Little by Little

What is dynamic pricing?

Navigating the Wonderwall of dynamic pricing (a flexible pricing practice which adjusts the price of a product or service in response to market demand) can be as Supersonic as an Oasis reunion tour. As a new ballot opens for sale of Oasis tickets, it remains to be seen if Ticketmaster will deploy dynamic pricing, which in the first ballot left many fans to pay more than double the original advertised price for their tickets.

Although dynamic pricing is a common pricing strategy used in industries like travel and hospitality (think Ryanair), where demand can change rapidly and pricing adjustments can provide strategic advantage, Some Might Say that its use in ticketing for music events and live sport is unfair, especially when prices surge unexpectedly and without notice. 

How does dynamic pricing work?

Dynamic pricing uses advanced technologies such as artificial intelligence to analyse market conditions and adjust prices in real-time. These technologies process large datasets on supply and demand, market trends and consumer behaviour to identify patterns and swiftly adjust prices in response to changing market conditions. Such technologies are therefore advantageous to ticket sellers like Ticketmaster who can use them to maximise their revenue potential even if it leaves fans Crying their Heart Out at the price. 

Is dynamic pricing illegal?

While dynamic pricing is not itself unlawful, the context in which it is deployed may breach consumer protection legislation if for example:

1. The ticket price is not transparent
2. Consumers are misled, such as by the omission or hiding of material information
3. It amounts to pressure selling, namely depriving consumers of the time or opportunity to make an informed choice

These protections are currently set out in the Consumer Protection from Unfair Trading Regulations 2008 (CPUT).

When tickets for the Oasis reunion tour first went on sale on 31 August 2024, consumers were given a price for tickets, only to be informed at the point of purchase (after waiting hours in a virtual queue) that the price of the tickets had risen significantly. To make matters worse, consumers had mere minutes to decide whether to purchase the tickets at the significantly inflated price or not.

There is therefore an argument that Ticketmaster breached CPUT because consumers weren't provided with transparent information and/or they were mislead about the ticket prices before they joined the queue (eg that consumers were not informed that the advertised price was subject to dynamic pricing and could change), and they didn't have sufficient time to make a decision at the time of purchase. However, this argument hasn’t ever been tested by a court and so it's a legal grey area at the moment. 

CMA investigation

In light of the Gas Panic caused by Oasis’ ticket sales, the Competition and Markets Authority (CMA) announced that it was investigating concerns raised about the sale of Oasis concert tickets to determine whether Ticketmaster had indeed breached consumer protection laws. The ASA (the regulator of advertising in the UK) has also received over 1,000 complaints about the clarity of the pricing of these tickets, but it has recently announced that it shall be supporting the CMA investigation rather than carrying out its own separate investigation, which invariably would have covered much of the same ground.

The CMA is in the preliminary phase of its investigation, gathering information from numerous sources, including Ticketmaster, the event organisers, the management team of Oasis, and individuals who bought or attempted to buy tickets on Ticketmaster’s platform.

As part of the investigation, the CMA will consider if:

1. Ticketmaster engaged in unfair commercial practices prohibited under CPUT
2. Consumers were given clear and timely information about the fact that the ticket prices were subject to dynamic pricing and how that would operate
3. Consumers were put under pressure to purchase tickets within a short timeframe and at a significantly higher price than they expected to pay, potentially impacting their purchasing decision

Notably the timing of the investigation coincides with CMA’s response to a letter from the Secretaries of State at the Department for Business and Trade and Department for Culture, Media and Sport on the issues surrounding live event ticket sales. In its response, the CMA repeated its view that more protections are needed for consumers buying tickets on the secondary market, which are often resold at substantially higher prices that the original purchased price.

What does the future hold for the ticketing industry?

In addition to the CMA investigation, the Government has said that it'll pick up the issue of dynamic pricing as part of its broader consultation on ticketing. Consequently, there may be some specific rules around dynamic pricing brought in at a later date, although we anticipate that the Government will focus more on the secondary ticketing market (which has been a cause for concern for many years).

The Government also recently announced that the consumer protection elements of the Digital Markets, Competition and Consumers Act 2024 will be implemented in April 2025 (with the provisions around “subscription traps” to follow in Spring 2026). These will replace the existing laws under CPUT, and will provide more protection to consumers by (among other things) tightening the rules around pressure selling. It'll also give the CMA greater enforcement powers, and increase the level of fines payable by those found to be in breach of the legislation. However, it'll not apply retrospectively and so it's of little use to Oasis fans today.

The investigation by the CMA and the Government’s review of pricing strategies highlights the need for a Rock n Roll Star approach to consumer rights in the ever-evolving live event ticket marketplace to ensure that not just the Rich Man’s World gets to say, Hello at live events.