Inter-league baseball offers a good excuse for another example of analytics from the wide world of sports (and entertainment) where tickets, pricing and schedules have been a complex science for years. Teams set prices long before the season begins and often can’t adjust pricing to either fill empty seats or get a premium for top performance. That is changing, however.
Barry Kahn of QCue estimates that $20 billion is lost annually in sports and entertainment ticketing because of “mispricing.” In a Business Week article on innovation, using data analytics to regularly examine dozens of variables can help close that gap. Companies such as QCue and Digonex Technologies compare prices, attendance, time of advance purchase, and other factors and can dynamically adjust prices to either attract sales or optimize load factor and profit –the same way airlines and hotels have to manage inventory that is time-sensitive and very perishable.
Just as a coach works to improve performance, Indianapolis-based Digonex teams with the Cleveland Cavaliers to use a Sports & Entertainment Analytical Ticketing System (SEATS), which was launched in November 2009. Any economics …
Inter-league baseball offers a good excuse for another example of analytics from the wide world of sports (and entertainment) where tickets, pricing and schedules have been a complex science for years. Teams set prices long before the season begins and often can’t adjust pricing to either fill empty seats or get a premium for top performance. That is changing, however.
Barry Kahn of QCue estimates that $20 billion is lost annually in sports and entertainment ticketing because of “mispricing.” In a Business Week article on innovation, using data analytics to regularly examine dozens of variables can help close that gap. Companies such as QCue and Digonex Technologies compare prices, attendance, time of advance purchase, and other factors and can dynamically adjust prices to either attract sales or optimize load factor and profit –the same way airlines and hotels have to manage inventory that is time-sensitive and very perishable.
Just as a coach works to improve performance, Indianapolis-based Digonex teams with the Cleveland Cavaliers to use a Sports & Entertainment Analytical Ticketing System (SEATS), which was launched in November 2009. Any economics major can tell you the goal is to find the sweet spot where supply and demand intersect – in the company’s words “To generate maximum economic return for clients while providing fair prices for consumers.”
In San Francisco, a strong season for the baseball Giants is helping ticket sales, to be sure, but another boost can be credited to QCue, which uses business intelligence tools to create “What if?” scenarios and analyze trends and projections for each of the 41,000 seats in the ballpark.
Are there ways to optimize the value of McCovey Cove? Fans gather in the bay beyond right field at AT&T Park in San Francisco, hoping to catch a home run ball. In Chicago, the rooftop bleachers of neighboring buildings created a “cottage industry” of seats beyond the team’s control.
No one wants to pay scalper prices for tickets or overpay for premium seats when lower-priced options are available. And there are lessons here for every business on how to cultivate fans, reward loyalty and use time – and other variables – to your advantage, when you know the details.
David Wallace
Spotfire Blogging Team
Image Credit: Microsoft Office Clip Art