Q’s With A Pollstar Live! Panelist: Nederlander’s Alex Hodges On The Great Recession

Courtesy Nederlander Concerts – Alex Hodges
Nederlander CEO Alex Hodges

It might be an exaggeration to say that Alex Hodges has seen it all, but not by much. In a music industry career that has spanned six decades, the Nederlander Concerts CEO has represented luminaries including Otis Redding and Stevie Ray Vaughan and is known as a force in the world of concert promotion.

So, Hodges can take a wide-lens view of most industry happenings. But even so, 2009, and the recession that arrived with it, stands out.

“It was a tough year,” Hodges tells Pollstar, adding, with signature levity, “All you gotta do is go read the book The Big Short.”

On Feb. 12, Hodges will join WME’s Michele Bernstein, Paradigm’s Marty Diamond, Live Nation’s Joey Scoleri and Bob Roux and CAA’s Andrew Simon at Pollstar Live! to discuss that challenging time in the industry. Titled “‘The Great Slump of ’09’ – What We Learned 10 Years On (And How Do We Stop It From Happening Again?),” the conversation will analyze how the industry-wide downturn permanently altered the live landscape.

In conversation, Hodges offers up anecdote after anecdote about the changes he personally observed in the wake of the financial crisis. He says he was an early supporter of ticketing site Goldstar. It tapped into “a hidden market of people who were window shopping,” Hodges explains, and in a tough economy a venture appealing to “bargain shopping” was destined for success. Social media, meanwhile, “is the old word of mouth — and it’s much more dramatic.”

Even more dramatic? The method Hodges and his team experimented with to disguise poorly selling shows at the Nederlander-operated Greek Theater in Los Angeles. As attendance took a hit in 2009 and 2010, they put military-grade camouflage coverings on empty seats, and Hodges says record executives couldn’t tell the difference.

“Everybody has adjusted,” he says. “If you’ve kept your job, you’ve adjusted to these changes.” Though he cautions that, in uncertain financial times, industry creativity can only solve so much. “Jobs are number one, period,” Hodges notes. “You gotta find a product people want, but if they don’t have money in their pocket, you’re hurt.”

Hodges connected with Pollstar to discuss the Great Recession, how the downturn compared to others he has observed and what the industry did to right the ship.

Can you speak to how the recession in 2008 and 2009 impacted the live music sphere?
Alex Hodges: It was a worldwide recession. It was really dramatic. You have to look to your local economy and how it affected your business. And it affected us dramatically in Los Angeles and Orange County and so forth. It was a big hit. In particular, the Greek Theater probably had a few more cancellations in ’09 and ’10 as tours weren’t necessarily holding up on a cross-the-country basis. And even if we had a good day, if the tour’s not holding up, they may cancel the whole tour, which means even if we had a successful day, we would lose a show. We did some things to try to adjust. Ticket pricing and being careful and a whole host of things. But it was pretty dramatic. You felt lucky that you had enough staying power to move forward into the new year.

How did the 2009 downturn compare to other downturns you’ve seen in the concert industry over your career?
You could always see it and feel it in your ticket counts if there was an energy crisis, whether it be gasoline price or home air conditioning in the summer or heating in the winter, you could always see that there was some trending that seemed to correlate to some energy crisis, or period of spikes and high gas prices, or spikes or not enough supply or whatever for propane. Whatever elements of energy goes for heating and for the pocketbook, for the bill. Nobody escapes heating and power issues. Generally, I have seen economic questions come into play and dampen ticket sales. Without question. I’ve never personally experienced anything like 2009 and 2010. That was just unbelievable.

What developments did the industry institute to right the ship?
As companies and concert promoters face any troubling moment, it’s not that they overreact — I wouldn’t say people overreact — but they’re struggling to find some kind of magic solution, whether it’s discounting tickets or discounting several shows or discounting on a venue every show. A big company could discount across the board, across the country and do massive amounts of media impact to discounting tickets. That can have a good effect of a spike igniting the interest and it could have a negative effect otherwise.