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Bon Jovi tour's big payoff

Ray Waddell
Billboard
Dec. 5, 2005 12:00 AM

Bon Jovi's Have a Nice Day world tour is proving to be worth all the fuss.

And more than 20 years into its career, the New Jersey band looks to have reached the stature as a live act that could carry it for another two decades.

Since the tour began Nov. 2, Bon Jovi has "without question" put up its strongest numbers ever, according to Rob Light, the band's agent and managing partner at Creative Artists Agency.

"Sales, attendance, dollars, merchandise; on every level it has been great," Light tells Billboard. "This is monumentally strong."

AEG Live nailed down the international promotional rights for the tour after what apparently was a hotly contested competition with rival Clear Channel Entertainment. The outing, which includes at least 75 dates, is AEG Live's first international touring model.

"Don't let anyone say differently - it was an active, do-or-die, win-at-all-costs bidding war," says Randy Phillips, CEO of AEG Live.

"I knew this tour was going to do well, and I felt we were going to make money and get the full promoter profit," Phillips continues. "But this tour is on steroids, it's doing so well. It has blown way past our internal projections."

Last time out in 2003, Bon Jovi grossed $42.4 million and drew 788,607 from dates at U.S. arenas and European stadiums. That was enough to rank the band 11th among all touring acts for the year. Bon Jovi worked with various promoters on that tour, which helped set the stage for the battle to promote Have a Nice Day.

"Every time Jon Bon Jovi has toured, there has always been the exploration of what kind of deals are out there," Light says. "This year, with everybody's belief that this was going to be one of the biggest tours in the world, the offers were much more aggressive."

Bon Jovi's growth in the past few tours has been "exponential," Light says. "There's a moment in any artist's career where you click over from just a touring act to iconic. And I think Bon Jovi made that transition this year, where they're in the same league as the U2s and the Stones and the Springsteens of the world. The tours and the live shows are so good they have the ability to sell tickets based on the sheer force of performing ability."

After AEG Live got the nod to promote Bon Jovi worldwide came industry talk that AEG had vastly overpaid for the tour.

"There were so many different stories floated, all of this red herring stuff," Phillips says. "We got the tour basically because we stepped up to the table early, we didn't hesitate and we came up with the better marketing mousetrap, where they felt we could really help them not only do a tour and sell tickets, but help promulgate the brand that is Bon Jovi."

Light says marketing was a tool CCE and AEG brought to the table. "Not trying to be politically correct, AEG has been a great partner, but that's not to say Clear Channel wouldn't have been," he says. "The way AEG presented their offer and their marketing scheme just felt right this time around, and it has been very, very successful."

Asked if the profit margin was thin, Phillips says, "The margin was healthy in terms of the risk-to-reward ratio, the investment. But there was risk, and the corridor of risk was larger than it usually is on a tour when you step up to this type of guarantee."

Typically on national or international touring deals, more lucrative dates are cross-collateralized with smaller dates to minimize risk. "The crossing structure of this tour would give a college economics professor room to pause," Phillips says, adding that each market was set up differently.

So, for the record, is Bon Jovi worth the AEG Live investment? "Beyond," Phillips says. "So much so that I'm . . . going to pitch the next tour. I want to stay in business with them."

Phillips may get his chance soon. After Bon Jovi concludes its North American arena tour in January, the band begins a run of European stadium dates, also promoted by AEG Live. When the European leg wraps in June, the band will have moved about 1.3 million tickets and grossed about $100 million. And, Light says, discussions are under way for "something big" next summer, which could mean a return to North American shores. Tickets prices in the United States range from $50 to $100.