‘Funflation’—and live event hype—goes up against more cost-conscious consumers
Rising entertainment costs are often a concern for consumers, but hybrid experiences, and fandoms, may present a path to growing monetization.
Jana Arbanas
Kevin Westcott
Brooke Auxier
Bree Matheson
Akash Rawat
Live entertainment has been working its way back into the spotlight after the pandemic slump. In recent years, ticket sales and revenues for many live events, like music concerts and sports competitions, appeared to have bounced back to (or even exceeded) pre-pandemic levels.1 Some attribute this renewed post-pandemic fervor for live entertainment to “funflation,” where consumers’ willingness to pay high prices for live experiences drove demand, and with it, ticket prices.2 But this live event hype may be cooling off—with rising costs for both event producers and consumers reaching a tipping point. However, while many consumers surveyed say they have not attended an event because the cost was too high, more loyal fans may be willing to invest in these live experiences.
Still, there are reasons to be hopeful about the state of live entertainment. In mid-2024, Deloitte surveyed approximately 3,500 US consumers about their media and entertainment preferences and sentiments for its latest Digital Media Trends study (see “Methodology”). According to this research, a majority of consumers (61%) have attended at least one live event—like a music concert or festival, in-venue sporting event, comedy show, or theatrical performance—in the last six months. The average attendee surveyed went to seven live events in the past six months. And those in younger generations, namely Gen Zs and millennials, are more likely to attend nearly all types of live events and attend more of them (figure 1).
For many of those surveyed, the communal experience of live events, along with the musicians, performers, and teams featured at the events, are the major draws. Reasonably priced tickets also top the list of reasons to attend live events, which could be a signal that funflation is waning.3 In fact, nearly 60% of consumers surveyed said they didn’t attend a live event they would have liked to attend because the cost was too high. But many people say they’ve spent in the triple digits on a single ticket to a recent event: Respondents who’ve attended a music concert in the last six months reported spending an average of US$150 on their ticket to that concert, and likewise, sporting event attendees spent an average of US$132 on a single ticket to a professional sporting event in the last six months. For both events, Gen Zs and millennials surveyed reportedly spent more on their tickets than those in older generations.
Cost-conscious consumers tighten spending on streaming video services, too
Many Americans are concerned about rising prices for everyday purchases,4 and more than 40% of survey respondents rate their household’s financial situation as “fair” or “poor.” So, it’s unsurprising that there are frustrations with rising entertainment costs—both outside and inside the home—too: A majority of consumers surveyed (64%) said they were frustrated that the entertainment services they subscribed to continue to raise their prices. Churn, or the percentage of consumers who have canceled at least one streaming video on-demand service in the last six months, remains high at 44%. Churn and return, or the percentage of people who have canceled at least one streaming video service and then later renewed the same service, has increased to 31% among respondents, which could suggest people seem to be canceling services when they don’t need them to help save money and then turning them back on when new content they like becomes available. There have also been notable increases in subscriptions for ad-supported streaming video service tiers (this figure rose from 46% to 56% since the last study). Along with it, usage of free, streaming video services has also increased (up to 63% from 57% in the last study). Both trends signal that consumers are likely seeking out lower-cost options for their in-home entertainment needs. With these other cost-conscious entertainment behaviors in mind, it may be unsurprising that many people appear to be more selective about the live experiences they invest in.
These ticket prices align with the increasing costs associated with producing live events—and rising costs across the value chain, from insurance to labor to equipment.5 In recent months, several artists have canceled their tours due to low ticket sales or have moved their shows to smaller venues to help lower their own costs and increase profit margins.6 These cancelations and venue shifts may be signaling a slowdown in the live events industry—a case of supply outpacing demand—or may tell a broader story of cost-conscious consumers whose preferences are shifting.
But high costs may not be the only thing preventing consumers from attending events: Inconvenient locations, no entertainment they want to see, not liking crowded events, and safety concerns also rose to the top as barriers to attendance. For nearly 20% of consumers surveyed, tickets not being available and simply preferring to watch events at home were top reasons they decided not to attend live entertainment experiences.
Hybrid events show promise
Despite these factors, certain types of live events may be more likely to drive in-person attendance, according to our survey findings. For instance, close to 60% of respondents would prefer to attend a live music concert in person instead of watching from home. Conversely, when given the same option for a live sporting event, just 32% of respondents would prefer to attend the competition in person. This might suggest that some expectations established during the pandemic—like being able to access premium content from the comfort of home—have persisted. As such, a majority of consumers surveyed (57%) say they would prefer to watch new movie releases at home versus in the movie theater (figure 2).
Still, movie theaters offer a possible path forward if they’re willing to innovate. Consumers in our study show interest in paying to watch other kinds of events at movie theaters—with roughly 40% of consumers surveyed saying they’d pay to watch a live sporting event in real-time or a live broadcast of a concert on the big screen. These out-of-the-home experiences can offer a “hybrid" tier of live entertainment for consumers who may be cost or time-constrained and offer event organizers another path to growing monetization and engagement.
Fans are less cost-conscious about live events
Focusing on less casual fandoms—and fan communities—should be a core consideration for live entertainment. Findings from our survey suggest that these fans, across fan groups,7 are more likely to attend live events than the average consumer and spend more money on tickets, too. For example, music artist fans8 (who make up 37% of the sample) who have attended a concert in the last six months spent US$16 more on their ticket than the average concert attendee. Similarly, sports team fans9 (who account for 36% of our sample) spent US$18 more on a single ticket for the last sporting event they attended, compared with respondents overall who attended sporting events. And when asked about the maximum they’d be willing to pay for tickets to their favorite musicians’ stadium concert or a ticket to their favorite team’s game, fans surveyed in these respective groups suggest they’re willing to open their wallets for their fandoms (figure 3). The value of fans is high as the survey indicates that they are more likely to say they make purchases to express their fandom—on tickets, merchandise, and more—than consumers overall.
Using the community aspect of fandom can be a key tactic for engagement. This is especially true for those younger generations surveyed: Fifty-four percent of Gen Zs and millennials say their fandom helps them make new friends (compared with 24% of Gen X, boomers, and matures combined). And roughly half of Gen Zs and millennials surveyed say that being a part of a fan community is important to them compared to just 22% of those in older generations (figure 4). This sense of community and belonging could be a significant driver of engagement and loyalty for many young fans, as it can reinforce their commitment to their fandom and encourage ongoing participation in events and related activities.
In addition to live event attendance, fandom can also help drive engagement with other ancillary activities. For instance, fans are often more likely to follow their favorite teams, franchises, and musicians on social media, join online forums, buy merchandise, and consume cross-platform experiences. This continuous cycle of engagement with their fandom can create deeper connections and result in multiple touch points for interaction and potential monetization.
Although many consumers may consider it cost-prohibitive to attend live events, fans may continue to invest in their fandoms and the communities that come with them. Those nurturing fandoms should think of live entertainment as an important extension to deepen affinity through an active means of engagement.
Takeaways for media and entertainment companies and live entertainment producers
- Artists and event producers should consider strategies to reset ticket prices for live events to make live entertainment more accessible to a broader population of people. This could include prioritizing smaller venues, exploring stadiums outside of major metropolitan areas, or cutting back on production costs.
- Sports teams and leagues can position their in-venue offerings as a premium, can’t-miss experience. As sports streaming and broadcasting become more innovative, interactive, and customizable, being strategic about how to make the in-venue experience more desirable and worthy of investment could be key.
- If living room entertainment experiences continue to improve and cost consciousness persists, consumers may favor in-home experiences versus live ones. Finding ways to “hook” this audience with digital experiences that help them to grow their fandom may convince them to invest in live event attendance in the future.
- Loyal fan communities will likely follow their fandoms and show up to live experiences. Nurturing these fan groups and building live experiences to engage them may be an effective approach for music labels and artists, sports teams and leagues, and other live entertainment organizers.
- Using movie theater spaces to stream live concerts or live sporting events can serve as a “hybrid” (lower investment) approach to live attendance, where more casual fans can be converted into more dedicated fans.
Methodology
These insights are based on an online survey of 3,554 US consumers that was conducted in June and July of 2024. Throughout this report, we reference generations. Our generational definitions are as follows: Generation Z (1997 to 2010), millennial (1983 to 1996), Generation X (1966 to 1982), boomers (1947 to 1965), and matures (1946 and prior). The survey was fielded in collaboration with an independent research firm and all data is weighted back to the most recent US Census to give a representative view of consumers in the United States.