Cheap New York Baseball Tickets!
The New York Times ran an interesting page 1 story by Ken Belson yesterday on the thousands of early season empty seats in the new baseball parks, the new Yankees Stadium and Citi Field. In contrast to the typical situation where unsold seats are up in the nosebleed sections, the twist in NY is that many of the unpurchased seats are among the best on the house.
The teams are being pointedly second-guessed due to the very high face values they set for these premium seats. Obviously, the general economic downturn, together with the collapse of the financial industry, has made the situation much worse. Teams (and concert promoters) have longed talked of using “yield management” pricing models similar to the airlines and hotels to maximize their revenues. Perhaps the Yankees and Mets example is a testament to just how difficult this is to pull off.
Two interesting points here.
The first is that some have suggested that perhaps the teams chose their price structures emboldened by the asking prices they have historically seen in the resale market for tickets, expecting to keep more of what they perceived the market would bear. If so, there are two problems with this thinking.
- the “asking prices” that one sees on ticket marketplace and broker sites are what is being offered at any given point in time, not where the actual transaction prices end up. As one can see by doing any ticket search on FanSnap, there is a large variation in the asking prices, and sellers change their prices constantly. Not every one is an equally motivated seller.
- ticket resales have grown to a multi-billion dollar market due to meeting fans’ legitimate needs to buy and sell. If there was no demand, there would simply be no market. What are ticket market buyers paying for? Sure, they can get access to great tickets and what used to be called “sold out” events. What is not always appreciated is that fans also greatly value the convenience of being able to buy tickets when they want, not on the team’s sales schedule.
No surprise that if team prices were set based on asking vs. transaction prices, and expecting fans to pay a premium for tickets offered at the beginning of the year, there were few takers. It’s a long season.
The second point is that market prices for tickets (just like any other commodity) are ultimately determined by the balance of buyers vs. sellers. As I told Ken, with economic circumstances motivating so many season ticketholders to sell, and with so many fewer buyers available, market prices have plummeted, in some cases even below the original face values.
Essentially all of the 250+ comments on the article were critical of the teams and lamenting that with the new higher face values, “regular” fans have been priced out of going to see their favorite teams. It is gratifying that the solution for these fans is actually the ticket resale market (which people often equate only with premium prices), which is producing market prices to see the Yankees and Mets in their awesome new stadiums for less than $10 a ticket. Of course, one can actually find some pretty amazing tickets for great values as well.
Isn’t it ironic?