Since 1995 - Insightful commentary on the Georgia Bulldogs

Post Big data and ticket prices

Wednesday September 18, 2013

The NFL is increasing the price of its most expensive Super Bowl tickets in order to “close the gap between the face value of the ticket and its true value as reflected on the secondary market.” You can see why they’d want to do this: if a $1,250 ticket is going to end up fetching aver $2,500 on the secondary market, why not try to capture some of that difference in the primary market?

Thanks to the online secondary marketplace, we’re getting a much better and transparent sense of the true value of a ticket. Some are worth almost half of face value (if that). Others sell for many times the original asking price. As schools continue to partner with these secondary brokers, they should be gathering quite a bit of data about the demand for their tickets.

In a day when schools are squeezing all of the money they can out of their football programs, will they use this data to adjust future prices? Differential ticket pricing is already done at this level, but it’s still somewhat crude. Several of our opponents already place Georgia in a premium tier. More attractive opponents create higher demand, and prices are set higher. But how much higher? If we know that a visit from Alabama brings resale prices to over $200, why stop at a premium price of $90? Of course you have to balance maximizing revenue with selling out the stadium (not necessarily the same thing), but you’ll at least start with a more precise idea of what the price should be.

Any tinkering with ticket prices will be a slow process. You have an entrenched fan base used to a certain system, and there will be a negative reaction if too much is done too soon – especially if similar adjustments aren’t made at the bottom end of the scale for less-attractive games. But as the data builds and schools get an exact picture of the demand for their tickets, it will be very tempting to transfer those premiums from the secondary markets into the coffers of the teams. As with the NFL and the Super Bowl, I’d expect this to start with the CFB playoff where the potential gap between primary and secondary markets is the highest. Just don’t be surprised to see it from individual conferences and schools down the road.

Comments are closed.