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Mastering Ticket Pricing Strategies for Maximum Revenue Generation

Learn about pricing, revenue, demand, and yield management strategies for optimizing ticket sales in sports events and maximizing profits. Understand the importance of setting prices based on customer willingness and market demand.

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Mastering Ticket Pricing Strategies for Maximum Revenue Generation

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  1. LESSON #2: Ticket Pricing

  2. DEFINITIONS • Price: the amount of money you charge customers for one unit. Ticket prices should reflect what customers are willing and able to pay. • Pricing seats for a sporting event is tricky. A team would rather sell a seat for $1 than leave it empty and get no money. • However, if all seats are sold for $1 the team would never make any money.

  3. DEFINITIONS • Revenue: the money you collect for things you sell. r REVENUE = Unit Sales X Price of each unit • A sports franchise has a number of revenue sources… • Ticket sales • Concessions • Licensing • Sponsorships

  4. Is Revenue the same as Profit? 100 tickets sold for $10 each = $1000. Does the team keep all $1000?

  5. DEFINITIONS • Demand: the amount of goods or services that customers want to buy. • Ticket price for a sporting event should be determined by the amount of demand that exists for that event.

  6. If demand for a product is High (many people want it), then companies can charge more for their product. If demand is Low (no one wants that ugly patterned shirt at AE) then the price must be reduced to try to get rid of it!

  7. DEFINITIONS • Yield Management Pricing: involves setting different prices for goods and services in an effort to maximize revenue when limited capacity is a factor. • Ex. Higher price for field level 50 yard line seats.

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