SportsProf

(Hopefully) good sports essays and observations for good sports by a guy who tries (and can sometimes fail) to be a good sport.

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Sunday, August 10, 2008

The StubHub Marketplace

I had some Phillies tickets that I couldn't use in late August, put them on sale for 75% over face value on Thursday afternoon, and they sold within hours.

What gives?

First, I'll explain my logic in pricing the tickets where I did. Normally, I'm not looking to make a profit on my tickets. I'd just like to break even, period.

Second, buying a partial season ticket plan is expensive, in my case 4 tickets for 17 games apiece at a very healthy price per ticket per game. I would submit that most individual fans cannot afford to front for these tickets, which are downstairs on a baseline at Citizens Bank Park. I would further submit that, if possible, the average fan would try to split this package with a neighbor (where it would still run him about $1,500 per season), the same way I gather some people split four tickets for a full season ticket plan (81 games) among 8 friends, assuming that a) you can find them, b) you can sustain this coalition and c) you divide up the tickets fairly (as well as who gets the rights to the post-season tickets that a full season ticket (and a partial season ticket, for that matter) convey). Before you think that I'm sharing more information than you need, remember that the tickets aren't cheap. Which is why, I'm sure, that Major League Baseball teams have a deal with StubHub so that they can get a share of the cut when fans post their tickets (i.e., for most, the tickets they cannot use) on StubHub for sale -- StubHub, to a degree, helps fans finance their purchase of partial and full season-ticket plans by enabling to sell some of them. The teams don't have to get into the finance business. While I'm not sure they ever felt they had to do this, I guess that they felt they were losing purchases because most fans can't use the full allotment of tickets and it's a ton of hard work to sell tickets to people within your community. StubHub, then, provides a great marketplace, and everyone can win. (Well, almost, as it's hard to sell tickets for games against bad teams in the spring -- when the weather is bad in the Northeast -- or late in the season if your team has fallen out of the pennant race, unless you have a relatively new stadium).

Third, back to me. I didn't want to make a huge profit, but the market is the market, and I wanted to make up for a set of tickets I gave away to literally someone who took them at the last minute because they were for a mid-week game in late April (read: school night, tough weather). And, at that, of the dozens of sets of tickets for sale in my section, mine were the cheapest. By $5 per ticket in one case, and by $10-$40 a ticket in the rest. So, whoever purchsed my seats did pay a premium in one sense, but he got a bargain compared to what the market was asking for the seats. And I got some partial funding for my big initial outlay of cash in the off-season.

Fourth, is this all fair? I honestly think it is. First, when you buy a partial season ticket plan or a full one, you get saddled with a bunch of unnatractive early season games because the weather is bad and people typically get into the game when the weather warms up or when school's out, or both. Second, for the benefits you can get by selling extra late-season tickets that you can't use because you'll be on vacation or because you make a small profit to help the losses you take on early-season games, you as a purchaser of a season-ticket plan get fair treatment (precisely because when you pay your money up front, you take the "bad" -- that is, cold weather, games). Third, the people who want tickets for a single game in August, for example, in Philadelphia, have a choice. They can go to the team's website and, if available, purchase tickets at face value in the (sometimes far reaches of) the upper deck, or they can test the marketplace by going to StubHub and paying the market price for a single game. Remember, they aren't asked to front monies for a partial or full season-ticket plan, so, in my mind, the extra they are paying is the extra opportunity cost of not making a bigger outlay in the off-season. In the end, sellers and buyers both get what they want, especially in a tight marketplace for Phillies tickets.

Now that I've said my peace, I'd like the fans and economists out there to weigh in. What do you think? Is StubHub a good thing or bad thing? Do the teams get a good deal out of StubHub? When will the teams simple weigh the prices of their tickets on a game-by-game basis based upon, for example, data derived from StubHub sales that takes into account a) absolute price, b) the time of year and c) how well the team is projected to do? My guess is that when this happens, the teams will adjust their ticket prices accordingly and take the profits, as they may be, away from StubHub and those who commit to partial or full season ticket plans (who will be asked to pay even more for their subscriptions). Sure, even in this scenario, StubHub will continue to exist, but my guess is that the average season-ticket subscriber will lose money in this scenario.

In conclusion, if you're looking to buy or sell tickets, go to StubHub. It's a great marketplace.

3 Comments:

Anonymous The Sports Curmudgeon said...

Prof:

You asked if your selling of these tickets was "fair". Unless you have some knowledge that the buyer was coerced in some way to buy your tickets at your price, I have to think the process was "fair". You had something to sell and he was willing to part with the amount of money you wanted in order to obtain that "something".

Now, when teams refuse to sell all of their available tickets to willing buyers early in the year just so the teams can put them out for sale at a later date at a higher price, that sort of smells like "unethical" to me. But I'm not sure that "ethics" is an important part of this marketplace...

2:29 PM  
Blogger ColoradoJimH@yahoo.com said...

I'm happy you rec'd the price you did. I on the other hand, have a different story. StubHub sold me invalid tickets. Read more:
http://stubhubsoldmeinvalidtickets.blogspot.com/

11:16 PM  
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