Sports Abacus: Mini-Pack Pricing
While I’m a huge supporter of mini-packs in trying to fill seats with longer term buyers than the single game folks who arrive only to complain about price, I also don’t believe that mini-packs should be priced the same as their season ticket counterparts.
This is an issue of understanding how each seat’s revenue works, because each seat actually is destined to earn some type of revenue throughout its seasonal or lifetime use. Whether that be at 100 percent capacity each season or at 10 percent. It is up to the vice president of sales to fully understand and maximize each seat’s revenue.
When mini-packs are sold, however, this is not always taken into account. Mini-pack pricing doesn’t attempt to garner more income out of a fan who has not committed to a season ticket. In fact, the majority of the time, the mini-pack price breaks down to exactly or about what the original season ticket pricing is for that seat location.
Does it stand to reason that a mini-pack holder should actually pay a little more, instead of the same, for the same seat as a season ticket holder? As it is, instead of blocking out the seat’s revenue for the season at 100 percent capacity, in many cases, the mini-pack capacity will be only 20-40 percent in terms of actual revenue earned from a longer than single game commitment by a buyer.
All of this comes down to understanding exactly what value a season ticket holder should be receiving compared to a mini-pack holder. By carving up a seat’s season ticket buy into several mini-packs, it offers the risk that you will not make up with four mini-pack buyers to fill a season otherwise blocked out by one season ticket holder.
Mini-packs should be bringing folks up the sales escalator, not allowing them to step off at a quarter or halfway from the top.
That, in my opinion, is what happens when mini-packs are priced no different than the season ticket in terms of what each seat costs.
Let’s delve into this one a little further:
I found an MLB team’s 2014 pricing model for a Field Box seat, which offers its season ticket price at $1,620, a 40-game mini-pack at $800 and a 20-game mini-pack at $620.
The season ticket pricing comes out to $31 per game. So does the pricing of the 20-game mini-pack. But, a 40-game mini-pack comes out to $20 a game.
So, why exactly would someone buy a full season ticket at $31 a game when they can purchase half of the games at $11 less? It does not make sense.
But that’s the main issue with mini-pack pricing. There’s little incentive to jump to the full season ticket model if the mini-pack plan is significantly cheaper. Then, it is, all about price point.
Why shouldn’t it be in reverse? Why shouldn’t the season ticket be less than a mini-pack?
Mini-packs are about the convenience of being able to select only a small portion of games in better locations instead of having to purchase a full season ticket.
Shouldn’t part of that analysis be that a mini-pack should be priced higher, not lower, than its season ticket counterpart?
Why not raise the mini-pack price to $35 a game instead of $31?
That would make a 20-game mini-pack $700 instead of $620.
That would make a 40-game mini-pack $1,400 instead of $800.
Now, I know there are some folks reading this asking why a 40-game mini-pack should almost cost $220 less than a full season ticket. Perhaps that’s because it allows for justification to get the person to pony up the $220 for the season ticket.
If they really want a 40-game plan, make sure that they do the math and really see that its almost worth it to pay $220 more for 40 more games.
Regardless of the sales escalator, teams should be focused on ensuring that each seat is building revenue. It makes it more likely that revenue, even from ancillaries, will be pushed up with the more commitment of a ticket buyer – that means that the 20-game and 40-game pack should be a bouy for teams, not simply passing off the same revenue within those 20 or 40 games as their season ticket counterparts.
While this may seem like just ramping up a few dollars, it also keeps into perspective that mini pack people are typically not the customers that you want to retain at the same mini pack price and level each year. In fact, you want them going up the sales escalator, not crowding the middle section.