Mar 23, 2009

Statistics, attendance, marketing and the Cleveland Indians


Using statistical analysis of ticket purchases to understand the preferences and price limits of their fans, the [Cleveland] Indians learned that fireworks after a game draw an additional 4,000 fans; every one-degree temperature drop below 70 Fahrenheit costs them 300; and when the New York Yankees come to town, attendance jumps 11,000.

The Major League Baseball club is at the forefront of using statistical analysis to design pricing. The team says its plan will increase ticket revenue 5 percent this season...

“The goal was to do a better job figuring out what people were willing to pay for their product,” said Vince Gennaro, 57, a Purchase, New York-based consultant who managed the research project. “Where could we add value to convince them to make the purchase or decrease the price where demand is lower?”


Gennaro, author of “Diamond Dollar$: The Economics of Winning in Baseball,” analyzed three years of Indians sales data. He correlated factors like attendance, no-shows and walk-up sales with weather, promotions, the team’s record and the school calendar to determine what isolated events contributed to purchases.

He then asked more than 200 people in focus groups to rate their preferences. Would they rather watch the Indians play the Kansas City Royals during the warm days of July or the Boston Red Sox on cold, windy day in April? Would a bobblehead-doll promotion matter?

Lastly, the team researched the secondary ticket market to see which games drew more than face value.


The Indians’ research revealed that when children are on summer break, attendance increases 1,200; if rain is in the forecast, it falls 2,200; a bobblehead-doll giveaway brings in 4,700 people; and any promotion involving centerfielder Grady Sizemore, an All-Star three of his five seasons, increases attendance by 6,600.


The Indians came up with a four-tiered ticket plan that lowered prices to fill empty seats and increased prices when demand was high.

Promotions, like giveaways and fireworks, and season-ticket campaigns were then designed to increase what fans in each of the pricing plans were demanding most.

The biggest discounts are during weekday games in April and May, when the weather can get cold and rainy, children are in school and other sports are still in season. Ticket prices for seats in the park’s lower bowl were cut by as much as 50 percent.

Read the entire article...


No comments: