New research shows that variable pricing for NFL games boosts ticket sales

New research shows that variable pricing for NFL games boosts ticket sales

National Football League

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How can a sports team stand out from the field with variable ticket pricing strategies? A new study in the journal management science highlights the introduction of variable price increases in ticket sales in the primary market based on the National Football League (NFL) ticket markets.

The study, “Scoring a Touchdown with Variable Pricing: Evidence from a Quasi-Experiment in the NFL Ticket Markets,” examines primary and resale ticket market data from every NFL regular-season game from 2012 through 2015. The authors note that adopting Variable Prices increase primary market ticket sales by 1.59% per game.

“We’re investigating the reasons for this positive impact and we find that customers accept lower prices for less popular games and higher prices for more attractive games,” says Hayri Alper Arslan of the University of Texas at San Antonio.

Arslan, along with University of South Carolina’s Necati Tereyagoglu and University of Colorado Boulder’s Ovunc Yilmaz, say 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 ones games.

“Through our novel dataset, this study sheds light on the interplay between primary and resale ticketing market dynamics and provides important insights for sports teams interested in increasing ticket sales and revenue,” says Tereyagoglu.

The study concludes by pointing out the situations in which variable pricing is most effective. “For example, we find that variable pricing is more successful in the hometowns of teams with lower income levels and greater income diversity, and creating more game tiers in variable pricing leads to higher sales,” adds Yilmaz.

The researchers are clear that while variable pricing allows sports teams to respond to changing in-game demand, reports indicate somewhat limited implementation.

More information:
Hayri A. Arslan et al, Scoring a Touchdown with Variable Pricing: Evidence from a Quasi-Experiment in the NFL Ticket Markets, management science (2022). DOI: 10.1287/mnsc.2022.4588

Provided by the Institute for Operations Research and Management Sciences

Citation: New Research Shows 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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