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Brian Walton's news and commentary on the St. Louis Cardinals (TM) and their minor league system

Cardinals new dynamic ticket pricing plans set

The St. Louis Cardinals have selected the vendor for their new dynamic ticket pricing starting in 2011.

Back in November, the St. Louis Cardinals announced they would be joining the ranks of other teams across a number of professional sports using dynamic ticket pricing starting this coming season.

Anyone familiar with how airline seats are priced and sold already understands the basic concept – charge more when demand is high and drop prices when demand is lower.

The challenge for clubs is to make these changes quickly and in a manner most advantageous to maximizing profit. Of course, the team spins it as being a fan-friendly action. Thank God they are looking out for the peeps.

“Our number one goal is to provide our fans with the best values possible and fill the stands at Busch Stadium,” said Joe Strohm, Cardinals vice president of ticket sales.

New news on this front occurred on Thursday, when it was announced that both the Cardinals and Oakland A’s have selected their vendor to manage the process.

Qcue [kyoo kyoo] from Austin, Texas will be the provider of the “dynamic pricing engine” that will manage ticket prices for the 2011 season. The Cardinals are far from the first to hop onto this bandwagon, joining other teams from Major League Baseball, National Basketball Association, National Hockey League and NASCAR as Qcue clients.

Qcue’s algorithms adjust prices in real time as they monitor ticket demand. Conditions such as pitching matchups, weather, opponents, day of the week, sales to-date and other factors are taken into account. The software communicates directly with Tickets.com, MLB Advanced Media’s wholly-owned online ticket seller, allowing teams to change prices almost instantaneously.

According to stats on Qcue’s website, 40 percent of seats end up unsold while 10 percent of tickets are re-sold on the secondary market at an average of double the face value. Clubs see opportunity in cutting into each.

The Cardinals haven’t had problems selling tickets any time recently, though 2010 brought seemingly more specials than in the past. The team drew 3,301,218 to Busch Stadium last season, the fourth-highest attendance in Major League Baseball. It was the 14th time in franchise history and seventh straight season the team topped the three million mark.

The stakes are especially high for the Cardinals. Despite being in the 24th-largest metro market of 30, the team ranks in the top five in MLB in local revenues, according to team president Bill DeWitt III. That category includes food, beverage and of course, ticket sales.

During his Winter Warm-Up presentation, DeWitt noted that his club is more dependent on these local revenues than many others and announced the Cardinals are implementing a customer relationship management (CRM) system to enable them to track individual customer histories and target specialized initiatives.

MLB also has their fingers in the lucrative ticket resale segment of the market as they enter their fourth season of a five-year deal with EBay’s StubHub Inc. unit signed in 2007.  Season ticket holders looking to resell individual game tickets are assessed a fee equivalent to 15 percent of the sale price while buyers see 10 percent tacked onto their purchase. I suspect clubs have also used this avenue to move excess inventory. It is masked as Stubhub does not disclose sellers’ identities to buyers.

First and foremost is filling up the stadium the first time around.

“Qcue’s solution not only gives us greater day-to-day ticket pricing flexibility but also broadens the ticket-buying fan base, rewards fans for buying earlier in the season and protects season ticket holder value,” Strohm said.

I am not so sure about the assertion of rewarding early buyers, as ticket prices could just as easily go down for certain games as the season progresses.

The benefits of dynamic ticket pricing to the team is clear. For the customer, it is much less so.

Acquiring tickets is being turned into an investment-style guessing game for the prospective buyer. At any sporting event, like on an airplane, each person in a given row may have paid a different price for an identical seat, yet no one other than the ticket seller themselves know who got the best deal.

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