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Can you sell more tickets by actually offering less?

Whether you are in the business of selling General Admission tickets or official ticket-inclusive official hospitality packages all of us are in the same weird place at the moment with the slow opening back up of the Live Event business.

What does the customer want? And how best to ensure that whatever seats or packages or percentages of a venue are available to sale actually are purchased?

Sportico has summarised a fascinating and counter-intuitive experience that was widespread across American professional sports that are in the process of ‘reopening’.

Here is their overview:

‘Ticket sales in a socially distant environment was initially thought to be an exercise in square footage. Pro teams constructed post-COVID ticketing manifests that would enable them to fit as many fans as possible into their respective venues given local and state limitations. It was widely assumed the more fans a team could cram into a stadium, the more revenue they would generate. But as the industry continues to gain experience with live events in the ‘new normal,’ organizations across pro sports are realizing that selling tickets in pairs—which actually reduces the number of fans the team can host—is the best way to meet customer demand and maximize sales revenue.’

Sportico’s article draws on a number of sources for evidence of this.

Orlando City SC was among the first pro sports teams to play games at home, with fans in attendance.

The club’s initial attempt at a socially distant ticketing manifest (like many others) mirrored the ‘bigger is better’ approach referenced. VP of Sales Chris Spano explained what he and his colleagues started to do out of sales instinct:

‘The natural gravitation is [to figure out] how to get the most seats [filled] in the building.’ By loading up their sales systems with six and eight-seat blocks, the club designed a seating chart that would safely fit 6,500 fans (around 25% of capacity). But the team quickly learned larger blocks of tickets ‘are just not what people are gravitating towards right now and that the [extra] inventory doesn’t do [the team] any good if it’s out there in six-packs and eight-packs and not being consumed,’ Spano said. The MLS club ended up selling just 13% of the venue’s seats to the team’s first home game since March (granted it was played on a Wednesday evening).

Orlando City tweaked their sales strategy for the next two games, breaking down four-, six- and eight-blocks of tickets into pairs. That change had the effect of reducing stadium capacity (to between 5,000 and 5,200 seats). But on the sales side there was a greater percentage of seats sold and more revenue being generated. Whereas only 13% of total stadia seats were occupied on August 26 that number rose to 15% for the September 5 game on Sept. 5 and hit 20% on September 12.

As any statistician will tell you just because there is a correlation doesn’t mean there is a causation.

The quality of the game may have had an impact and unknowns within local market demand could play a role.

But, in discussing this with Sportico, Patrick Ryan, the co-founder of Eventellect,  suggested most teams should be allocating ‘60% of their [socially distanced] inventory to be sold as pairs because all of the data says that is what consumers want.’ The ticketing executive also advised clubs to ‘stay away from six- or eight-packs. When teams are eating tickets on these events, they’re eating bigger groups.’ This past Sunday, the Kansas City Chiefs only sold tickets in blocks of four or more. The team did not sell out their limited inventory.

Spano agreed that teams should be going ‘heavy on pair seats and have a good amount of fours available as well, because that’s what people are buying.’ He indicated that fans who want more than four seats can ‘likely still be accommodated [by the team] on a case-by-case basis.’ For what it’s worth, 33% of tickets sold to the last three Orlando City games were sold in pairs while 38% were sold in blocks of four.

Fans’ desire to purchase seats from the ticketing front office in pairs is mirrored on the secondary market: SeatGeek reported that during the 2019 NFL season, 58% of sales were for two seats. In Jacksonville for the season-opener on Sunday, 61% of the sales on the secondary market site were for pairs.

Sportico’s conclusion makes for unhelpful reading for those whose main client base is selling into corporates:

‘There are likely several reasons why teams are finding fewer buyers looking for large blocks of tickets. But none are more obvious than the changing needs of the corporate buyer. Corporations buy seats to host clients. Considering that is not an exercise currently occurring, there is little reason for business executives to be buying blocks of six and eight seats (and thus little reason for teams to be offering them).’

Colleges permitted to host fans this season have sold far fewer tickets to football games than anticipated. While that may have something to do with an older season ticket base (at least relative to the pro leagues), it also follows that many fans are simply not ready to return to large-scale events. If that’s the case, there’s no real reason for teams to worry about reducing the number of available seats by focusing on the sale of pairs over larger blocks. Ryan doesn’t think most teams, on most nights, could sell out more than 25% of their inventory right now anyway.

As the old adage goes, Less is More.

Five months ago the-then president of StubHub Sukhinder Singh Cassidy, joins CNBC’s ‘Closing Bell’ to discuss the coronavirus’ impact on the secondary ticket market. She has since left StubHub.
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Charlie Charters is a former rugby union official and sports marketing executive turned thriller writer whose debut book Bolt Action was published by Hodder & Stoughton in 2010.
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