Why Lady Gaga Will Earn $100 Million in 2011

Whether it’s showing up to an awards ceremony clad entirely in raw meat or nearly suffering a deep-vein thrombosis while wearing a dress made of caution tape on an airplane, Lady Gaga has a knack for making headlines.


She also has a talent for moneymaking. Gaga raked in $64 million last year by our estimate, making her the seventh highest-paid musician in the world, just $1 million behind sixth-ranked Jay-Z. Only U2 ($130 million) and AC/DC ($114 million) crested the $100 million earnings mark.


It’s quite likely that the financially shrewd Gaga will join the elite group by topping $100 million in 2011 — here’s why.

First of all, there’s touring, which should provide the largest chunk of Gaga’s earnings this year. In 2010, her 138-show Monster’s Ball tour grossed $133 million, second to only Bon Jovi on the list of year’s most lucrative tours. Gaga already commands a higher average ticket price ($102) than her New Jersey counterpart ($92), but she’s been playing to crowds of 14,000 on average (compared to Bon Jovi’s 33,000).

Over the next six months, Gaga is scheduled to play 41 shows at 20,000-seat venues like Madison Square Garden in New York and the Staples Center in Los Angeles. If she maintains her average ticket price, that works out to $2 million gross per show, of which she’d likely keep about $800,000 a night after concert promoter fees, security, and other costs. Multiply that by 41 and you get roughly $33 million.

The second half of the year could prove to be even more remunerative as Gaga’s new album, Born This Way, hits stores in June. If sales approach those of her debut The Fame, which moved 12 million copies worldwide, Gaga could easily see $10-$15 million from the album alone. Because she’s both an artist and a songwriter, she’ll also stands to receive an extra-large chunk of money from radio play– a fat publishing check in the U.S. as well as songwriting and performance royalties for spins abroad could add up to another $10-$15 million.

An ultra-successful album would have an even more profound financial impact beyond simple record sales and radio play. ”If the album is a success, she’ll be beyond an arena act by the end of the year,” says entertainment attorney Bernie Resnick, who represents Gaga’s manager, Troy Carter. “She could be a stadium act.”

That means if she goes on the road for the last six months of the year, she could be filling 30,000- and 35,000-seat venues. Perhaps average ticket prices would dip down to a Bon Jovi-esque $90 with more seats available, but even so, that’s means a stratospheric nightly gross in the $3,000,000 range and take-home pay of somewhere around $1,000,000 a day. That’s $45 million for a half-year of touring, bringing the full-year total to nearly $80 million, not counting merchandise, which could easily add another $6-$10 million in profits for an 80-date tour.

Gaga also shills a range of products: video sunglasses for Polaroid, headphones for Beats by Dre, phones for VirginMobile, and a host of items and services via product placement in her videos (a Russian billionaire reportedly paid $1 million to place himself in one of her videos). All these commercial ventures should add at least another $5-$10 million to her coffers.

To be sure, these projections are on the rosy side, as they assume her new album will be a smash success and global macroeconomic conditions will be strong enough that people will continue to dish out $90-$100 a pop for concert tickets. But add it all up: $80-$90 million for touring and merchandise, $20-$30 million for album and radio play, and $5-$10 million for endorsements, meaning Gaga could cross the $100 million threshold with relative ease — and earn as much as $130 million in an absolute best-case scenario. That’s before taxes, management fees, attorney costs, etc, but likely enough to make her the top-earning musician in the coming year.

“She’s just hitting her stride artistically and commercially now,” says Resnick. “We’re only seeing the beginning.”

Source:  Forbes