Tim McGraw: The Big Show (First of Two Parts)

It’s nice work if you can get it, and Tim McGraw has made the most of his position as a best-selling country music superstar. In the latest issue of the Country Music Hall of Fame’s Journal of Country Music, CMT.com reporter Edward Morris takes a closer look at McGraw’s various revenue streams and business plan. The full story is available in the JCM, but this first excerpt in a two-part series highlights the costs involved in recording and touring. The second excerpt appears Saturday (July 5) on CMT.com.

“It’s a great time to be a superstar in country music,” says Scott Siman, president of rpm
management. He should know. He manages Tim McGraw, one of the handful of country artists who can sell a million new albums the first few weeks out and fill arenas without the support of a gaggle of mid-level acts. Within a period of two days in November of 2002, McGraw released a new album, Tim McGraw and the Dancehall Doctors, and a lavishly illustrated coffee-table book and starred in his own NBC-TV special. It was an image rollout as cunningly choreographed as a Rockettes routine, and it underscored the mindset and industry muscle that the 35-year-old singer has developed over the past decade. Riding the wave of this media surge, McGraw conducted a 50-plus city tour in 2003 titled Tim McGraw and the Dancehall Doctors’ One Band Show. A look at just how business gets done in McGraw’s world — where the money comes from and where it goes — offers insight into the pressures and practices of being a country music superstar.

Increasingly, country music looks to its superstars to keep the business running. Comparatively few artists sell enough albums to pay back the money it took to launch their recording careers. With skyrocketing marketing and recording costs for major labels, a debut album that sells half-a-million copies will still leave the company deep in the red. Thanks principally to releases by such high-profile superstars as McGraw, the Dixie Chicks, Shania Twain, Faith Hill and Kenny Chesney, country music sales in 2002 were up 12.2 percent from the year before. Every other format saw a decline in sales. According to Nielsen SoundScan, the company that monitors such figures, nearly 77 million country albums were purchased last year. But most country artists sold in modest numbers. Emerging acts didn’t emerge very far.

“All you have to do is look how concentrated the sales are in the Top 10 acts and then look at the drop off,” observes Chuck Flood, whose firm, Flood, Bumstead, McCready & McCarthy, manages business and finance for such acts as Vince Gill, Patty Loveless and Lee Ann Womack. “Go back and get SoundScan [totals] from five or six years ago and look at how many units you had to sell for a week just to get on the [Billboard] charts. And look at it now. … Some weeks, you can be selling less than 1,000 copies and still get in the Top 75 on the country albums chart.”

“It’s really hard to be a new and developing artist right now,” continues Siman, who also represents Jessica Andrews and Billy Gilman. “It’s hard to create critical mass and a break anymore. It’s hard to make enough noise, to get enough penetration. Are there enough listeners at country radio? Are there enough press opportunities?”

Like all well-established performers, McGraw has a fairly wide range of income sources. The biggest one by far is concert ticket sales, which account for about 66 percent of his total take. Following it are record royalties (12 percent), merchandise sales (10 percent), sponsorship and advertising revenue (5-7 percent) and royalties from producing records by other artists including Jo Dee Messina (5-7 percent). The year 2002 also saw the publication of his first book, Tim McGraw and the Dancehall Doctors: This Is Ours (co-authored by Martin Huxley), which was released with great fanfare by Atria, a division of publishing powerhouse Simon & Schuster. McGraw received a substantial advance payment for the book, which made the New York Times bestseller list and has sold more than 200,000 copies.

Tim McGraw and the Dancehall Doctors is McGraw’s most expensive album to date. It involved, among other niceties, renting, refurbishing and redecorating the Allaire recording studios in the Catskill Mountains of New York and lodging his band, recording crew and support staff there for 10 days. In the end, the album cost more than $800,000 to make. His first album topped out at less than $125,000.

Standing by friends is a favorite topic of conversation among those who work with McGraw. In a business where band members, managers, publicists and other satellite personnel are hired and fired on whim, friends and associates praise McGraw for his loyalty. The fact that his new book, album and tour all spotlight the name of his band, the Dancehall Doctors, testifies to this point. His newest bandsman has been with him since 1994. Mark Hurt, who co-manages with Siman, has been on staff for 13 years.

“You want to build a team around you that believes in what you’re doing and feels like they’re a part of it — a vital part of it,” McGraw explains. “To me, it’s about personalities as much as anything else. The band’s been with me a long time. They worked for me when I couldn’t pay them. In some of the early days, I borrowed money from these guys and used their equipment and their van. A lot of it’s loyalty, but, you know, they’ve become my friends. And they’ve been my friends from the first year we started playing together. Mark Hurt, he sold T-shirts and was our road manager. We are my career.”

“Tim is a very, very adamantly loyal guy,” Hurt says. “A lot of people hire and fire based on the needs of the tour. It’ll be this guitar player this year and another guitar player the next. Tim and I have always agreed that we should do enough business in any given year [to keep the band going].” McGraw did his 12-date mini-tour last year, Hurt says, to keep the band and crew paid and insured. Although he did not have attendance and ticket sales figures for all 12 shows, Bob Allen, who compiles the “Boxscore” concert grosses columns for Billboard and Amusement Business, says that 10 of the dates drew a combined attendance of 88,122 and grossed $4,078,624 in ticket sales. Extrapolating from these figures, the entire tour drew approximately 105,600 ticket buyers and grossed around $4.9 million.

Apart from his household staff, the artist has about 20 people on permanent payroll, including the eight-man band, tour manager, production manager, lighting director, front-of-house engineer, monitor engineer, stage manager, gear technicians, etc. For the 2003 tour, there are 65 to 70 people in McGraw’s road crew (including the band, seven video camera operators and up to 16 follow-spot lighting technicians). The caravan includes 10 equipment trucks and seven to eight crew buses. Crew salaries range from $1,250 to $5,000 a week each. The buses rent for $15,000 a month, with the fuel,
drivers, maintenance, cleanup and the use of satellite dishes and generators all costing extra.

“To make it all work from a financial perspective, I basically have to do four shows a week. So I can’t go over 350 miles in any given night,” Hurt says. “These guys are loading trucks until two or three in the morning, and five hours later they’ve got to start unloading. Under that scenario, it’s a pretty tight schedule.” He estimates it cost McGraw “in the neighborhood of $1 million” upfront to get the tour on the road.