|Friday, June 21
Sports fans feel pinch in seat (prices)
By Darren Rovell
The home-plate view from Seat 10 in Row 9 in Section 115, located down the right-field line at Coors Field, is always the same. But the price to sit in this seat from one game to the next is not.
Why the difference? A fireworks show is scheduled for the first night.
The Rockies are the most active of the three major-league teams, including the St. Louis Cardinals and San Francisco Giants, that practice variable ticket pricing, an idea that could pick up momentum and eventually become part of every sports fan's lexicon.
The idea itself is nothing new. Pricing based on supply and demand are standard practices in the hotel and airline industries. And college football teams have charged fans more when better teams come to town for decades now.
"If it works well, this type of ticket pricing is going to catch on like wildfire," said Rod Fort, a Washington State University economics professor who has written three books on the business of sports. "If all the other teams see the Rockies ticket revenue at the end of the season and see it's gone up significantly, teams will institute their version of varied game pricing immediately."
The first tier of ticket prices are the "value" games ($16.97 average), which occur when the Rockies play against teams, such as Houston and Philadelphia, that traditionally don't draw well in months of typically spotty weather -- April, May and September. The second tier involves games against division rivals ($18 average) on weekdays during the bad-weather months. The third tier are the "premium" games ($20.07 average), which is every game during weekends in May and summer months. The fourth tier are the "classic" games ($21.58 average), which include Opening Day as well as games against the New York Yankees and Cleveland Indians and the fireworks games on July 3 and July 5.
"With the economy being the way it is, we need to do something like this to generate as much revenue as possible, while at the same time making sure that we have tickets that are affordable," said Kevin Fenton, senior director of ticket operations for the Rockies. "We could make the same amount of money by raising all ticket prices for all games, but that wouldn't make sense because there are differing degrees of demand for each game."
Fenton said first-time ticket buyers are sometimes confused when they see the five-color coded pocket schedule, but they soon realize that they've seen this supply-and-demand pricing system before.
"There are a lot of ski areas around Denver and you can easily get a half-priced ticket if you go skiing before Christmas," Fenton said. "But once you get to the third weekend in February, you'll be paying full price."
The St. Louis Cardinals have raised every ticket $1 for games played between May 21 and Sept. 2, a move that could be worth $750,000 in revenue. The San Francisco Giants have sold out Pac Bell Park since it opened in April 2000, but this year the team started charging $1 to $5 more for games Friday-Sunday. The decision is expected to yield the team $1 million in net revenue, Giants chief operating officer Larry Baer said.
"The real question is: Could you do this more like the airlines, where teams can price their tickets by the hour?" Baer said. "It might send the wrong signal to your fans, that you are trying to squeeze the last dollar out of them, but the scalpers by your stadium are doing exactly that."
Baer said he believed all teams in all sports could vary its pricing structure for tickets, an idea he says ultimately holds down prices for season tickets.
Fort, who reviewed the A's ticket sales for the Oakland Alameda County Stadium Authority in the early '90s, says that all teams charge different prices for tickets with the same face value -- even if it's not as blatant as the practices of the Rockies, Cardinals, Giants and Cubs.
"Ask any ticket manager in baseball if they wheel and deal and cut prices with group ticket sales every day," Fort said. "They'll all say, 'Of course we do.' "
The idea of colleges charging more for specific games goes back at least 22 years, according to the Rockies' Fenton. In 1980, Fenton was working at the University of Colorado, whose football team was coming off a 3-8 season. After realizing there was demand from Oklahoma and Nebraska fans, who were eager to see their team play at Boulder, Colorado raised prices for those games by $5, Fenton said.
The national champion University of Miami, which has 35,000 season-ticket holders, has one of the most varied ticket pricing systems in all of college football. The school will charge $45 for its home games against Florida State and Virginia Tech, $40 against Pittsburgh and Boston College and $35 against the University of Connecticut and Florida A&M.
"If there's a history of the game selling out, the demand is higher, so our price is higher," said Patrick Nero, Miami's senior associate athletics director, who says the school looks at ticket sales the past 20 years to help determine the price of games. "It's the fans who are deciding that a Miami-Florida State game is more important than a Miami-McNeese State game."
Since both the Florida State and the Virginia Tech games sold out when the schools visited two years ago, Miami raised the price of both games by $5, which Nero says will bring in an additional $800,000 in gross revenue. With the rivalries being as good as they are and with Miami winning the championship, even the price bump won't keep these games from being sellouts again, Nero said.
"A Rose Bowl ticket cost $150 and a lot of Miami and Florida State fans see this game as big as the Rose Bowl and they get it at a third of the price," Nero said. "I don't understand why professional teams wouldn't do this when they have their big rival coming to town."
The $10 difference between the premium and the value games at Miami isn't all that high. University of Texas fans will pay $40 for the team's Sept. 21 game against Houston, but $60 for its Oct. 12 game against Oklahoma at the Cotton Bowl.
"There is a risk because by charging more, your fans expect a better game," Fort said. "If you pay more to see the Yankees, you're not just paying to see the pinstripes on the uniform; you want to see a damn good baseball game."
"The bottom line is we only have eight regular-season games to sell," said Stephen Jones, chief operating officer of the Dallas Cowboys, who have 44,000 season-ticket holders who pay for every home game at the 60,000-seat Texas Stadium. "So each game has its own unique story -- whether it's just a great rivalry or a former player of yours now playing against you."
That, of course, doesn't mean that the Cowboys can't experiment with different ticket prices for different teams to gauge exactly how much fans will still pay to attend.
"If the team has figured out the right way to price, and it makes economic sense, people can complain all they want but there will still be people buying tickets," Fort said.
Jones said the problem with charging more based on strength of team would be an obstacle because of the NFL's tremendous parity. Since the teams have to finalize their season-, group- and individual-ticket rates with the league before the season, teams could put themselves in a tough position if an opponent who had been expected to be good comes into town with a poor record, Jones said.
"With a much larger season-ticket base than baseball teams, it's not quite as applicable," said Dan Connell, the team's senior vice president of sales and marketing. "The more season-ticket holders you have, the more potential issues you have when you start changing the prices."
If more baseball teams start charging differently per game, it might cause a greater split between the haves and the have-nots. Teams that already sell out would have more flexibility with how high they can go with the prices of certain games.
"It will be bad in terms of revenue disparity, and it will be worse for Joe Sixpack," Fort said. "Because now the only game he can afford is against a crappy team."
Darren Rovell, who covers sports business for ESPN.com, can be reached at firstname.lastname@example.org