How much do DJs make? Depends…right? Here are ’The Factors'

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How much do DJs make? Depends…right? Here are ’The Factors’

Chapter 1 – The Factors

Within the music industry, it is not unknown that one promoter may not get the same price for an act than another. The reason behind this is because of a number of factors. These factors are most commonly the city, the venue where the show is going to take place, that venue’s capacity, the ticket price, the promoter’s expected capacity, and the other secured talent on the show’s roster.
Let me break down each one and further explain why these are important to agents.

City:
The city the event is happening in is important when factoring in price and/or accepting offers. I break down cities across North America into what I like to call “A-B-C Markets”. Cities that are in the “A Market” category will pay more for an act because their scene can support the price. There is more of a population, venues are larger, and the music scene for the given genre of music is flourishing within the city. To go the polar opposite a “C Market” city would not have the population to support the scene and/or genre of music, most venues only have a capacity of 100 – 200, and because of these factors they will pay much less for acts, or they would not be able to bring certain acts through their area at all. A “C Market” would only get the same act that an “A Market” would get because of the routing of a tour or if a large scale event happens to be taking place in that city. So it is important for a promoter to know what market they are in and educate the agency they are working with on why their offer might be coming in low if they are a member of a “B Market” or “C Market”. Don’t assume the agent knows this, many agencies are handing high school graduates or close buddies scripts to make these tours happen, so do not assume their knowledge in this business. However do know your position in your market, I know many “C” level promoters in “A Markets” but they talk like they are número uno.

Venue:
The venue is important for a couple of reasons. Location, validation of capacity, history, popularity of the genre, and production quality are the main reasons why I ask for the venue name. Let’s break it down.
Location: If the venue is on a main strip then chances are it is more popular than a destination venue in the middle of nowhere. So the chance that the show is going to do well is more promising. However, this could also mean the competition is fierce so I will look to see what is in the area to see what the promoter is up against.

Validation of capacity: Not that I don’t trust promoters but it is good to know firsthand what the legal capacity of a venue is. Capacity is important to know what possible dollar amount the promoter could make on a given show. Knowing this possible dollar amount is not so we can try to squeeze as much out of the promoter as possible it is to understand what they are working with.

History: This is a two part meaning…history could mean just that, what has the venue done in the past, but it could also mean it has a cool factor. For example, The Apollo in Harlem, NY has a history and certain musicians consider it a milestone to play in a venue like that. So where does history fit within the offer process? A cool venue means the agent may be a little loose on his acceptance of a given offer since his artist told him, “Man if I could play there that would be awesome!” So since we are in the business to make our artist happy we will do what it takes to make sure that milestone appears on our artist’s resume. Then again when cool venues come into our scopes we also know that if the promoter can book a room like that then they must be able to offer a bit more than usual.

As for what the venue has done in the past I will move on to the next topic of, popularity of the genre.
The popularity of Genre: Electronic Dance Music does not do particularly well at rock and roll clubs. Why? The crowd that knows about the club will most likely be rock fans and will frown on the fact that dance music is coming into their club. Also, people who listen to dance music will most likely not consider that to be a venue that would host an event with that genre of music so they will overlook their schedule. The venue also will not be very hip to how to promote for dance music since they don’t know the audience. I believe I made my point. A promoter who puts on shows should book rooms that are known to do that genre of music. There are of course exceptions for example The Live Nation venue “House of Blues” in every “A Market” does shows of all genres. So when I get the venue name from a promoter I do look at the venue’s calendar to see what they usually do at the venue and I factor this in on the price/offer.
Production Quality: Larger venues usually have built in production into their clubs, they will also advertise this on their websites. This will be usually included in the price of the club so there will be no need for a promoter to hire sound and lighting companies to work the night. I will use this by knowing that part of the possible profit for the night will not be sucked dry by the need of hiring these sound companies or lighting technicians and their equipment. I will also know, going back to the rock club example, that the sound is not made for a dance music show. So chances are when a show is being produced in a rock club for a dance music show the promoter will have to bring in additional sound and lighting to increase the production of the show. This will be assumed and I will run with it.

Ticket Price / Expected Capacity / Other Secured Acts
I am going to group these 3 together because they are all related in the offer decision making process.
I do not use the venue capacity and ticket price to find out what offer to accept, I use the promoter’s expected capacity, their ticket price, and what other secured acts are on the show, sprinkled with the knowledge that I possess about the given market.

Ready for my formula
__________ (Expected Capacity) x ___________ (Ticket Price) = ___________ (Total Possible Dollars) + ________ (Expected Bar Cut) – _________ (Usual Production Costs) – ___________ (Cost of other talent + expenses for other talent) – _____________ (3rd party rentals [sound / lighting, etc] = __________ (True Actual Possible Dollars)
__________ (True Actual Possible Dollars) x .60 or .40 = __________ (Headliner and Supporting Act talent budget)
Note: Headliner or Supporting Act talent budgets usually take up to 60% – 40% of your Total Possible Dollars
____________ (Headliner and Supporting Act Talent Budget) x .20 or .40 = ____________ (Headliner or Supporting Acts Actual Performance Fee Offer)

Note: This is only the performance fee, travel, hotel, hospitality costs will be additional
If multiple offers will take place subtract the Artist Performance Fee Offer from the True Actual Possible Dollars and repeat the x .20 or .40 until you meet the entire talent budget you found above
Tip: If you want to avoid counter offers add 15% to 20% to your offer and note you did this to cover possible booking fees

Other Factors:
On top of all of those factors, there are always exceptions.
Personal Relationships / Hierarchy: There are promoters I just have a solid relationship with. I know they are fair, quick to pay, and put on a great show. So like any business, working with those type of people makes your life easier. Yes, it is true, we have favorites but this is known and it is natural. If a promoter practices good business practice you will gain respect from an agency and you will be given extra benefits. Many favorites create a certain hierarchy, here is how this goes. Promoter A is a high paying promoter, always pays on time, guarantees a sell out show, and the production quality of the event is amazing. We will run every artist through that promoter first before anyone else. If Promoter A can not secure a show in, then we move on to Promoter B, then C, then D, typically always in a set order influenced by the reputation that promoter has built up for themselves and the respect we have for that promoter, and most important, what is best for the artist. We have turned down high offers to play a “better” show.