South by Southwest is returning to Austin, Texas, March 7-15 for its 38th edition. Over the years, it’s evolved from a local, laid-back music conference to an international festival of all-things consumerism, including tech, culture, film, media—and yes, still music. In the ‘90s, it was one of the only music festivals showcasing hip-hop. In 2006, SXSW helped launch Twitter (now X) and hosted Foursquare’s official launch three years later; then in 2014, it had infamous ex-American intelligence contractor Edward Snowden, who leaked classified documents, attend a panel digitally from Russia, where he was seeking asylum.
But according to Austin residents, longtime SXSW attendees and experiential veterans who have activated at the festival in the past, it’s no longer such a hotbed for innovation. Why? “I think the event is having a bit of an identity crisis,” said an Austin-based marketing professional. “From the point of view of its programmers, they may be completely aligned in terms of what they’re trying to be,” the marketing pro told Vendelux off the record. But for its attendees, “it’s like, ‘Where did the innovation go? Where did the music go? Is it still a music thing?’”
Vendelux asked Peter Lewis, SXSW’s chief partnerships officer, what SXSW is. His response:
“It’s a destination for discovery. That holds true whether you are attending for music, film, TV, AI, health or anything in between.” He insisted that SXSW’s marketing “explicitly” states this, “but it is a large event. So it can be daunting to understand or navigate in a way that a more siloed conference or festival is not,” Lewis added.
There are very clearly two pools of attendees at SXSW, the Austin marketing professional said: consumers and businesspeople. And there’s two types of experiences that shape SXSW: the educational programming and the activations. “Some people are really going for business,” the marketing pro said. “I actually, anecdotally, talked to a lot of people last year that said that the sessions they were going to weren’t as well attended, because everyone was going off to these activations.”
But at the activations—where brands are evidently spending less money, according to another souce—”does business get done, or is it just a media free for all where everyone’s just trying to grasp that headline and get noticed?” asked an experiential veteran interviewed by Vendelux who has both attended and been hired to activate at SXSW for the better part of two decades.
The event prof, who asked to remain anonymous, said that in years past, one singular activation at SXSW would run a brand $1.5 million. “They’re telling me this year they have $1.5 million [budget] for the full year,” the event prof added. “I’m not going to tell you to go spend it here [at SXSW],” she added—and that’s because the barrier for entry is too high to warrant the type of attendance and innovation that made past iterations of the fest so memorable.
For reference, the “real cost of marketing” at SXSW and being on the official program runs anywhere from $40,000 for a 500-person party to upwards of $100,000 simply by adding in a live musical performance, according to Marketing Drive. Even street teams of 10 that roam around the festival promoting a new movie or TV show could end up costing a brand a staggering $75,000, Marketing Drive added in its 2013 report. Bureau of Labor Statistics Data shows that the inflation rate has surged approximately 35.% since then.
According to the experiential expert, because of these steep costs, in the past, smaller brands have notoriously created experiences un-officially affiliated with the SXSW festival “to allow people to come in and experience SXSW on the fringe without having to pay the ticket emission.” SXSW organizers, however, “get really angry with brands monetizing and building on the back of what they built,” she added, noting that this is only her opinion based on her history with the event.
In recent years, though, SXSW has “made it really hard for brands to do really great things with taxes.” It wasn’t immediately clear what fines or other “taxes” brands have to pay if they don’t follow official SXSW guidelines, but this event prof told Vendelux that it’s the loss of these “small boutique agencies repping brands with smaller budgets making something really cool and creative” that’s changing SXSW from what was once a “collective experience.”
“They [smaller brands] are the ones shaping culture and that aren’t so corporate orchestrated. And now it feels like Big SXSW bought out Austin,” the event prof anonymously told Vendelux.
Speaking of corporate, a slew of major brands will still be descending on central Austin’s Rainey Street District, Sixth Street and Palmer Events Center, among other venues, including Spotify, Dolby and LUSH, just to name a few. Lewis said that brands “continue to see quite a few big activations that have substantial budgets. I think the nuance—at least in terms of viewpoints—is how brands are choosing to deploy their dollars, and where they chose to focus. This is a reflection of brand goals as much as anything else.”
The experiential expert Vendelux spoke to sees things a bit differently: “This is the first year I haven’t even been asked to pitch for it. And I’m not going,” the event professional admitted. “And I love SXSW,” she added. “Even in past years when I wasn’t activating, I would buy myself a ticket and those aren’t cheap. I get the Platinum Badge and I bring people. (Platinum Badges this year are going for $2,295.) I go, I pay for all of the housing, all of the flights and everybody’s admission. It’s a $10,000-at-minimum investment in my agency.”
The event prof continued: “That investment I’m not making this year—not because I don’t have the money but because the return on investment has so diminished that I can’t get $10,000 worth of value sending my team there.”
Still, Lewis said that there were “over 500,000 participants” at SXSW 2024, and the team is “expecting another year of robust attendance” come the 2025 fest. The figure is quite off from the one local news organization Austin Monitor reported after last year’s event. “Total in-person attendance in 2024 was 47,661, with more than 180,000 more participating via streaming on YouTube,” according to the Austin Monitor. SXSW 2023 saw about 345,066 attendees, per SXSW data.
Lewis wouldn’t pinpoint exactly what types of attendees SXSW is looking to attract this year, only that the fest “offers unparalleled opportunities for people from all walks of life.”
