One of the most common ticketing questions that most event organizers will run across is this — "why aren't my event tickets refundable?" After all, there's no harm in giving someone their money back if they didn't use the product or service they purchased, right?
The answer is a little trickier than you may think.Between bookkeeping issues and the nature of event planning, full refund policies are often unsustainable in the events industry. Here's why.
Understanding Ticket Refunds
Let's start by saying this — all events have a refund policy. Typically, these come in three main types.
- A "no refund" policy
- A "partial refund" policy
- or a "full refund" policy
For the vast majority of events, you'll run into a no refund policy. No! It's not because the event planners are out to steal your money. In fact, it's incredibly difficult to sustain the latter two policies unless you're working on an extremely large event. That being said, some ticket promoters will ofter ticket insurance — which costs additional but will refund you in the case of an issue.
Most of the time, if you don't show up, you don't get your money back. But why is that? It sounds sort-of like a scam, right? Believe it or not, there's a good reason that you're not getting back your cash once you confirm your ticket. In fact, there are 3 good reasons.
1. A Ticket Refunded Isn't a Ticket Sold
Let's say that you're returning a scooter. You picked it up at Walmart last week, but you're just not feeling it. It's too slow, has stiff handling, and your friends really don't think that hot pink fits your lifestyle. That's fine! Walmart will take the return. Why? Because they can box it back up and sell it.
But, you can't do the same thing with tickets. Let's say that you bought a ticket for your favorite show, and you're super excited. But, when it comes to the night of the big event, you feel sick, and you can't make it. You should be able to get your money back, right? You didn't go to the show, and you still have your ticket to prove it.
Well, how is the event organizer supposed to sell a ticket to an event that's already happened? You paid for a seat that the event planner can't sell. Even if you know that you can't attend the event beforehand, selling a ticket twice is no easy feat. If you decide not to go the night-of-the-event, there's no guarantee that the event planner will be able to sell your ticket at-the-door. And, even if they do, it can cause additional issues — especially when it comes to bookkeeping. Which brings me to my next point.
2. It Would Be A Bookkeeping Nightmare
Let's say that an event manager decided to offer refunds a month in advance. That may sound like a good idea initially. After all, a month is plenty of time to resell the ticket, right? It is. But, from a bookkeeping perspective, selling a ticket twice is a headache. Often times, events have deals worked out with promoters, talent, and staff. These deals work by splitting ticket sales. If you sell a ticket twice, it creates confusion and payment issues when you look at the overall ticket split.
For example, let's say that an event promoter makes 10% of ticket sales. When you first buy a $10 ticket, the promoter makes $1. If you return that ticket and the promoter resells it for another $10, they'll make another $1. The promoter has now earned $2 from a single $10 ticket. These types of errors can rapidly multiply when it comes to big, elaborate events – especially if ticket sales are split among talent, promoters, and event managers.
But, for the sake of argument — let's take bookkeeping and the inability to sell a ticket twice off-the-table. There's a bigger, more intricate answer to this question.
3. Events Are Built on Attendance
Building an event require ticket sales. An event manager's first priority is creating a wonderful, engaging event. So, when ticket sales are good, areas are expanded, seats are added, new vendors are acquired, additional staff is trained, and more event talent can attend. So, if 12,000 tickets are sold, the event planner knows how much they have to spend, how big the event needs to be, and how much staff and manpower to put at the gates.
If a refund policy was in place, it could spell disaster for event managers. Let's say that 3,000 of those 12,000 people decided not to attend due to rain. That would be a big issue. The event planner would be overpaying for an event they can't afford. And this isn't uncommon. There's a reason that over 50% of people don't show up for free shows. If people know they can back out at the last second without any risk, many do.
Sure. Not being able to get your money back on event tickets may sound like a pain. But, there's definitely a reason that you can't. It could cripple the event and drain event managers and planners. Always think twice before you click purchase on those tickets. You probably won't be getting your money back.