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Scalping, er, "dynamic" ticket pricing

Let's say the backup quarterback is playing this week or the understudy is subbing tonight because the Broadway star is sick. Under a new ticket pricing system that's getting some attention, the tickets to this week's game or tonight's show could drop significantly. Of course, the tickets to a must-win game or a finale show could skyrocket at the last minute.

The NHL's Dallas Stars and baseball's San Francisco Giants are the two teams so far to sign deals with a company called Qcue, which specializes in "dynamic pricing." It's something akin to airline ticketing -- conceivably, the software can be programmed to change ticket prices every 15 minutes. But it won't be quite that dynamic for games. From Yahoo Sports:

The price charts won't be spinning like the big boards on Wall Street, but they'll be changing during the season in an industry known for setting prices long before the first game and leaving them alone. If the Stars are Stanley Cup contenders, fans will have to contend with a bull market.

"We're really looking at much more matching the value of the game to the price of the ticket than we are just a carnival game," said Barry Kahn, chief executive of Qcue...

Let's not confuse this with "variable pricing," which many teams do already. That's where teams set different prices at the beginning of the season for rivalry games or popular teams coming to town. The idea with dynamic pricing is that prices can change right up 'til game time.

Think scalpers like that? Uh, no. From the Puck Daddy blog:

"You're theoretically decreasing the margins on the secondary market if you're pricing them appropriately on the primary market," (Stars VP of Marketing Colin) Faulkner said. "I don't think they like it very much."

It could be a significant step in teams attempting to freeze out scalpers from the process altogether.

"You're starting to see the primary market and the secondary market's lines being blurred together," Faulkner said. "Teams would ultimately like to control the primary market and the secondary market. To use the airline example, it used to be that you needed a physical ticket to go ride on an airplane. When they first introduced ticketless technology, people were a little freaked out, but now it's the standard. There's no transferring your ticket to anybody else on a plane. Maybe that's where it goes with teams."

But there are also some questions. What about season ticket holders? They pay in advance. Should they get some kind of dynamic pricing refund?

Does this completely wipe out the chance for a family of four with moderate income to see the Yankees-Red Sox on a Saturday night?

Is it a good thing to have teams taking over the secondary market and killing the "scalpers?" Scalping is a more legitimate biz these days (and trying to band together against dynamic pricing).

On the other hand, dynamic pricing does give you the opportunity to get a deal on tickets, if you don't mind seeing the Washington Capitals without Alexander Ovechkin on a Tuesday night. As of now, unless you buy secondary, you're going to get the same price at the window whether Ovechkin's playing or not.

One last thing. Ticketmaster plans to roll out a dynamic pricing model this fall.

That might say it all.

Your thoughts?

About the author

DB's picture
DB - Sep 16, 2009

Fuck Ticketfucker completely. Teams can do whatever the hell they want. If scalpers want to take on risky tickets, let them.

Truth Police's picture
Truth Police - Sep 17, 2009

#1 All the fancy words just mean price increases

Teams already use variable pricing and will probably get bolder about trying to pass along price increases for perceived popular games, although they should study the Yankees PR and financial disaster this year and proceed cautiously, especially if they are playing in a publicly-funded stadium.

#2 Dynamic pricing will have no material effect on reselling

Teams will still want to sell as many tickets as possible as soon as possible. Season tickets, packages, group sales, single games. No way this changes - they are not going to hold tickets back and take the risk the market moves against them during the season.

This means only lesser quality tickets will remain, for all but the worst teams (where all tickets are arguably lesser quality!) These are the tickets that can be priced "dynamically." Having a good season? Jack up the prices a little (see point #1). Bad season? Won't be able to give them away.

None of the money and hardly any of the volume in ticket reselling is in these left over tickets. The market totally revolves around the best tickets, controlled by season ticket holders. Teams, jerk these folks around at your very great peril.

Attempts to restrict market forces are doomed to failure.