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NFL's Price Optimization of Super Bowl Tickets Could Lead the Way for Regular Season

Thursday, November 14, 2013   (0 Comments)

Forbes (10/04/13) Lawrence, Jesse

The National Football League's reported use of pricing optimization for this year's Super Bowl tickets could be a preview of the model it applies to regular season tickets later on. Although many people consider dynamic pricing as a way to sell tickets more efficiently in markets with low demand, the Super Bowl initiative could demonstrate the potential for profitability, since it could help the NFL generate an additional $13.6 million in revenue, writes TiqIQ CEO Jesse Lawrence. He says that if the NFL were to allow its teams to price dynamically, the group of teams that fill their stadiums between 85 and 100 percent of capacity would benefit more than anyone else. Fans of such teams have relatively strong loyalties and spend money for on-field results, and they tend to buy tickets even when the team is facing a tough season. Dynamic pricing would likely be especially advantageous to those teams, which currently includes more than a dozen teams. Assuming an average seat price of $150 and 3,000 unsold tickets per game, dynamic pricing could generate $50 million in sales. Lawrence notes that if the NFL opts to make dynamic pricing available season-long, it must have two pieces of infrastructure in place: paperless ticketing and the ability to find fans farther out on the demand curve.


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