How Dynamic Pricing in the UK Scores Big
This week I’m attending and speaking at the first Ticketing Technology Forum in London, a meeting of ticketing technology suppliers and venues. In future posts I’ll provide a more thorough overview, but I want to share information from a particularly interesting session presented by Julian Jenkins, Commercial Director at Cardiff City FC in the United Kingdom. For context, Julian is in charge of marketing and ticketing for this UK football team, which we’d call soccer.
His first point struck me as spot on: “Football clubs spend too much time on trying to control what they can’t — the game on the pitch [field] and not enough time on things they can — meaning the customer experience.” Seems like every theatre company or orchestra could say the same.
In Cardiff one way they address this is with dynamic pricing. My main learning was that Cardiff City’s pricing approach is to vary their single ticket prices by raising the face value of the ticket after a certain period of time. They are careful to protect their season ticket buyers by making sure that the initial price for a single ticket is greater than than the price season ticket holders purchase it at, and then as the match day gets closer they raise the price on their tickets. This offers a clear incentive to single ticket buyers to buy tickets early. This is akin to what the airlines have trained us as ticket buyers to do in the US — we all know that as the flight gets closer the ticket price for a seat goes up.
The results in Cardiff City have been strong. Julian reported that revenue was up 20%; in this case that means that for the same number of people in the stadium, they made more money per person as a result of dynamic pricing.
To make sure they were not doing damage to their brand with dynamic pricing, Cardiff City did some research on what fans thought of it. What really surprised them (and me) was that 60% said they were “more likely to buy a ticket” with dynamic pricing. So this looks like a win/win scenario. Not only do they bring in more revenue, but fans feel as if this is a net positive.
There was a lot more discussion at this conference about revenue management and pricing, some of which plays out on the technology side, and some on the consulting side. Derek Palmer, Managing Director of Tickets.com reported that there were 50 sports teams in the US doing dynamic pricing, which seems like a relatively low number to me, but is certainly a bellwether for what is likely to happen more and more in all aspects of live event ticketing all over the world.
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