Thursday, November 13, 2014
Football economics: Winning doesn't always produce a profit in SEC
Posted By Max Brantley on Thu, Nov 13, 2014 at 6:47 AM
Fascinating article from the Wall Street Journal about football ticket pricing in the SEC, with a focus on Auburn which has had to fall back on big-dollar donors to move tickets even while riding winning streaks. The article raises the specter of variable pricing based on game demand and considerations about the possibility of finite desire for high-dollar tickets, even when teams are winning. When they are losing …..
Arkansas doesn't figure in the story, except as a member of the same conference and one of the schools that still makes a profit on football and basketball.
I couldn't help but think of the Razorbacks' big game with Toledo in Little Rock next year in the passage about surge pricing.
Several football schools have tried to capture more of this ticket value with dynamic-pricing methods that measure demand before adjusting prices to maximize single-game ticket sales. These models don’t affect season tickets.
Rutgers, which introduced dynamic pricing this season for its Big Ten home games, said it projects about $400,000 in increased revenue. The process “allowed us to react to the market values,” said Rutgers marketing executive Geoff Brown.
Louisiana State increased ticket prices for three games against ranked opponents this year, including an Oct. 25 game against Ole Miss, in which lower-level sideline seats cost 40% more than face value by kickoff. LSU said it raised tickets from $100 to $110 and then $140, and that it has seen a “very small amount of increased revenue so far.” That surge came despite LSU being “very conservative” with the method, said Brian Broussard, LSU’s associate athletic director of ticket operations.
Arkansas put an add-on to its final game in Little Rock this year — a required contribution to the private Razorback Foundation. Some "fans" chose extended tailgating over end zone seats.
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