A few years ago sports fans did not have many options in acquiring tickets to live sporting events. In order to gain access fans had to buy season tickets directly from the team, purchase them from an unreliable ticket broker, or deal with some scheming scalper outside the venue.
Times have changed quickly within the live ticketing arena where secondary ticket services like StubHub and Ticketmaster Ticket Exchange have become extremely popular, while season ticket purchases have been on the decline. Secondary ticket sites allows fans to purchase whatever seats they want to as many games they desire. These services have completely revolutionized how everyday consumers buy tickets and in some cases have even become the primary purchasing method. There are thousands of secondary ticket sites out there pulling from the same inventory and driving margins down. Because of this teams are not only losing out on potential revenue , but on fan loyalty as well.
Season ticket sales for all major sports have suffered as a result. This MLB season, the L.A. Angeles of Anaheim, likely sold fewer than 3 million tickets for the first time since 2002. Their overall season ticket sales hovered around 17,000, which was down almost 50% from their record 31,000 ticket sales in 2006. Even with one of Major League Baseball’s star players in Mike Trout and playing in a major U.S. market, the Angels were affected by the rise in secondary ticket services during the 2015 MLB season.
While not every professional sports team has seen a precipitous drop, the Angels’ problem is not unique. Fans now are less likely to pay $5,000 or more for season tickets and then worry about splitting the cost with friends or getting stuck listing unwanted games on StubHub at or below cost. In many cases, picking and choosing great seats at individual events on the secondary market is the easiest, most cost-effective way to purchase tickets. The secondary market has been a tremendous asset for fans choosing to attend live events.
The smart teams are working towards giving their fans something more than just a ticket. This is a must for any team hoping to have their own fans purchase tickets through their platform. Many teams and organizations are experimenting with fan loyalty programs for season ticket holders that incentivize the experience and ensure that those paying top dollar are getting their money’s worth. Many teams are attempting these programs, however few of them have emerged with the right formula.
The Washington Nationals, for example, provide their season ticket holders with exclusive autograph sessions, an appreciation day, and even an opportunity to take batting practice at the park. There is a special entrance for season tickets holders to expedite the process of getting into the ballpark and there are even special lines for concessions. The Nationals’ philosophy is to improve the ballpark experience for their season tickets holders, offer them rewards, and increase their access to the players and venue. These are not things one receives when purchasing a ticket on the secondary market.
The New York Red Bulls, a member of the American soccer league MLS, has removed the term "Season Ticket Holder" from their vocabulary in favor of "Red Member." The reasoning behind this change was to make fans feel more included in the Red Bull organization and eliminate the transactional nature of the fan to team relationship. “Red Membership,” provides fans with exclusive perks and access that enhances the experience of being a season ticket holder. Red Members receive benefits such as invitations to private practices, members-only merchandise, and preliminary access to other events happening at Red Bull Arena. The Red Bulls understand what is at stake and realize what they need to do to maximize the season ticket holder experience.
As the 2015 MLS season was coming to a close, the Red Bulls began their 2016 Early Bird Renewal campaign. All fans who renewed their so called “Red Member” season tickets were given an exclusive Red Bulls red jacket only worn by the players. Thanks to the campaign, the Red Bulls surpassed their 2016 Red Members renewal goal before the 2015 calendar year ended. The Red Bulls are using their ability to offer “inside access” and experiential opportunities for “Red Members” that no ticket reseller can compete with. Inside access through high touch experiences will be the key component for how teams recapture the dollars they have lost in ticketing.
It is an interesting time for teams and how they go about navigating the current ticket marketplace. Some teams have seen a huge boost in ticket sales by welcoming ticket brokers and selling them huge blocks of seats. This method of selling to secondary platforms has become a band-aid to their problem. Unless teams are able to bring fans something more valuable and rewarding than just a seat at the game, season ticket sales will continue on this downward spiral.
Teams like the Nationals and Red Bulls are on the right track and several other organizations like the Washington Redskins and New York Jets have put together season ticket holder loyalty programs (I have seen it firsthand with the Jets as I am a season ticket holder). The entire concept is a burgeoning one and teams must go beyond loyalty programs in the coming years if they are going to regain the profits they are losing. StubHub and other similar services will continue to grow and gain popularity among consumers. People are still attending games in record numbers so teams have the opportunity to revamp this archaic process in favor of one that increases sales by bettering the entire experience for their fans.
Robert Tuchman is an executive at CAA Premium Experience part of Creative Artists Agency. Previously he founded Goviva which was acquired by CAA. Prior to Goviva he started TSE Sports & Entertainment which was acquired by Pfingsten Partners. He is the author of Young Guns: The Fearless Entrepreneur. Follow him @roberttuchman.
