How can a sports team win away from the field with variable ticket pricing strategies? New study in journal Management Science sheds light on the acceptance of variable price increases in primary market ticket sales by looking at National Football League (NFL) ticket markets.
The study, “Touchdown Scoring with Variable Pricing: Evidence from a Quasi-Experiment in NFL Ticket Markets,” looks at primary and resale ticket market data from every NFL regular season game from 2012 to 2015. The authors find that the acceptance of price increases primary market ticket sales variable 1.59% per game.
“We explore the rationale behind this positive effect and find that customers accept lower prices for less popular games and higher prices for the more attractive games,” says Hayri Alper Arslan from the University Texas at San Antonio.
Arslan, along with Necati Tereyagoglu of the University of South Carolina and Ovunc Yilmaz of the University of Colorado Boulder, says this work provides evidence of the increase in option value created by the resale market and explains the positive response to higher prices for more attractive games.
“Through our brand new data set, this study shows the interplay between primary and resale ticket market dynamics and provides important insights for sports teams interested in increasing ticket sales and revenue,” says Tereyagoglu.
The study concludes by focusing on the situations where variable pricing is most effective. “For example, we see that variable pricing is more successful in the hometowns of teams with lower income levels and higher income diversity, and higher sales result in more game tiers in variable pricing,” says Yilmaz.
The researchers point out that while variable pricing enables sports teams to respond to changing demand across games, reports show somewhat limited implementation.
Hayri A. Arslan et al, Scoring Touchdowns with Variable Pricing: Evidence from a Quasi-Experiment in NFL Ticket Markets, Management Science (2022). DOI: 10.1287/mnsc.2022.4588
Available at the Institute for Operations Research and Management Sciences
Quote: New research finds variable pricing for NFL games increases ticket sales (2023, January 24) Retrieved January 24, 2023 from https://phys.org/news/2023-01-variable-pricing-nfl- games-ticket.html
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