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SBJ/October 22-28, 2012/Franchises
Dynamic pricing comes to MLB postseason
Published October 22, 2012, Page 3
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|The A’s used dynamic pricing and it helped them sell out their three home divison series playoff games.
Increases in ticket prices, made by the clubs to reflect strong demand, in some cases exceeded 70 percent, so the experiment proved to be a strong revenue enhancement. Dynamic pricing was used for the League Division Series and League Championship Series; ticket prices will remain static for the World Series.
“The dynamic pricing in the playoffs definitely brought a lot of benefit,” said Steve Fanelli, Oakland A’s executive director of ticket sales and operations. “Particularly for us, not having clinched the [AL West] division until the very end of the season, it allowed us to capture some of the additional groundswell of interest. More importantly, it also allowed us to have another tool to communicate the benefits of being a season-ticket holder and locking in early” and avoiding any increases that dynamic pricing can produce.
The A’s sold out all three of their home games in their Division Series loss to Detroit. Fanelli declined to specify the additional revenue from dynamic pricing. But he said the effort was “effective” as some lower-level seats in Oakland, for example, grew from an initial price of $55 to $95 during the frenetic Oct. 3-11 period in which the A’s clinched the division and then played the Division Series. Lesser-priced sections also rose in price by similar percentages. The A’s typically went into their system twice a day to review and adjust ticket prices for available single-game seats.
The Cardinals were comparatively more conservative in their dynamic pricing execution, altering prices at most once a day, and often once every other day. But like the A’s and Giants, the club sought to use dynamic pricing as a means to seek out a more realistic view on the marketplace.
“What we’re trying to do is get the pricing right,” said Joe Strohm, Cardinals vice president of ticket sales. “There’s less vagaries in the system for the playoffs just given there’s far less runway before each game in terms of time. But conceptually, it’s the same as the regular season in that we’re trying to optimize the pricing.”
Testing dynamic pricing in the playoffs has been a goal of the Giants, one of the earliest adopters of the concept, for more than two years. Russ Stanley, the team’s vice president of ticket sales and service, said before the club’s 2010 World Series appearance that he was eager to see the system employed in October.
“There is such a huge middle ground between face value and what the market is actually bearing on StubHub. It’s ridiculous,” Stanley said then.
Still, elevations in dynamic pricing in most instances for the St. Louis, Oakland and San Francisco playoff games remained below peak levels seen on the secondary market.