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Saturday, October 31, 2009

The Dynamics of the StubHub Market for World Series Tickets in Philadelphia

Sounds like the title for an article in an academic journal, doesn't it?

StubHub fascinates me. Yes, they get their poundage out of every sale, but they also have created a very efficient (and safe) marketplace. I've used StubHub to buy and sell tickets, and I've found the site to be very easy to deal with. My great curiosity is how StubHub and the leagues with whom they have affiliations will use the data that they're accumulating to price tickets/make them available in the future. Especially the outstanding teams with the most demand.

I've noticed one thing about StubHub, which is that if you have tickets to a "hot" game or event, if you have four (instead of two), you're more likely to draw a higher price per ticket for the group. The reason is fairly simple -- many people are looking for four seats together if they can find them, but most people seemingly only have two tickets to sell. It stands to reason that more people purchase season- or partial season-ticket plans for two tickets and not four. As a result, groups of four are more scarce and, therefore, in the right circumstances, more valuable. Of course, if the team isn't a stalwart or the game isn't a "hot" one, the owner of four tickets always can sell his block of four tickets in two-ticket increments.

Now, if you're looking for an odd number of tickets, good luck (although I once bought three to a Phillies game a few years ago). So, if you're a family of four, you're in decent shape, but if you're a family of three or five, well, the dynamics are more challenging.

This article discusses the prices for tickets at Citizens Bank Park for Games 3, 4 and 5 and how the average asking price has dropped over the past day or so. Here's my thinking as to why: the number of available tickets this close to the time of the game (approximately 4,500 or so) is not a "scarce enough" number. That is to day, about 10% of the tickets are available for sale. Why? Because as die-hard as any team's fans can be, the economy isn't great, and many are thinking that if they can take a ticket that cost them $150 and parlay it into, say $1,000 twice over, they'll take the profit, watch from the comfort of their family rooms, not have to deal with traffic should public transportation go on strike (which it might) and run. After all, many of these same fans witnessed Series bliss last season (albeit on rainy nights) and the novelty has worn off -- they won't be missing the experience, in a sense, because they've been there and done that. Okay, so speculating about the reasons for the relatively large number of tickets available this close to game time might not be that accurate, but were the number of available tickets to be, say, 1,500, the average price per ticket, it stands to reason, would be higher (unless the remaining available ticket population is comprised mostly of standing room only tickets).

See what someone who likes stats and data can get totally intrigued by a site like StubHub? You see an efficient marketplace unfold before your eyes. Right now, that marketplace says that the profiteers will have to adjust their expectations accordingly in order to make a deal.

A friend at work came to me on Wednesday. He's a Yankee fan, he had a chance to buy a ticket at Citizens Bank Park, to go with a friend who is a rabid Phillies' fan. He asked me what I'd pay for a ticket, to get into the park. He knows I'm a huge Phillies' fan, but he also knows that I wouldn't pay a king's ransome for a ticket. So, I said "$500." After all, it is the World Series, he hasn't been, and, perhaps, every now and then you have to splurge (Phillies' fans know this well; they hadn't been to the Series for 15 years before 1998, it was 15 years before then, and who knows when this group of stars starts to show their age when they'll get back to the Series). His friend got the tickets through a connection , they're in the nosebleed section (but still a decent place to watch the game), and he paid $350. Good deal, I think.

Another colleague said that her son, who is in his mid-20's, bought a ticket for about $600 -- standing room only. Clearly, the Generation Whatever group wants to be at the game for the baseball but also for the party-like experience. That's a lot of money for that young man, because his income isn't what my collegue's is.

Then, another friend from work relayed a story about someone ponying up what seemed to be a huge amount for four tickets in the Diamond Club right behind home plate -- enough money to pay for a substantial portion of next year's season tickets. Those are good seats, but paying a couple thousand apiece seemed to be a bit much. So, the secondary market differs all over the stadium -- depending on who you know, where you want to sit, and whether friends have a connection.

So check out StubHub -- if for nothing other than the dynamics of markets for tickets to championship games.


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