Authors: Mark Mitchell*(1) and Dennis Rauch (2)
(1) Mark Mitchell (DBA, Mississippi State) is Professor of Marketing and Chair of the Department of Marketing and Hospitality at Coastal Carolina University in Conway, SC.
(2) Dennis Rauch (PhD, University of Iowa) is Professor of Marketing at Coastal Carolina University in Conway, SC.
*Corresponding Author:
Mark Mitchell, DBA
Chair, Dept. of Marketing and Hospitality
Professor of Marketing
NCAA Faculty Athletics Representative (FAR)
Coastal Carolina University
P. O. Box 261954
Conway, SC 29528
[email protected]
(843) 349-2392
ABSTRACT
This manuscript examines the potential for a Multi-Sport Sampling Plan as a price bundling strategy for collegiate athletics. Here, fans would receive entry to one game per sport to be used at their discretion. Such a sampling plan could increase current revenue and fan attendance while concurrently developing future ticket sales opportunities to these new fans based on their positive game day experience. This manuscript examines: (1) current price bundling strategies in the hospitality industry applied to athletics; (2) local market conditions that could aid in the successful development of a Multi-Sport Sampling Plan, and (3) implementation issues for athletic ticketing professionals.
KEYWORDS: ticket mini plans, athletic ticketing, price bundling
INTRODUCTION
Recent research by the Knight Commission on Intercollegiate Athletics found that athletics expenses were increasing at a rate higher than the concurrent growth in revenues (13). For example, NCAA research (16) found spending for athletics increased 43% between 2004 and 2008 while revenue increased by 33% during the same period. In an attempt to grow both revenue and fan attendance/support, athletic departments have become more creative and aggressive by embracing such strategies as the development of ticket mini plans, variable pricing per contest, promotional pricing to build demand for likely lesser-attended games, and value pricing when compared to the cost of attending professional sporting events (10).
Price bundling represents an effort by a marketer to combine parts of their product or service portfolio into a combined offer. This practice, sometimes known as ‘solution-based’ pricing or ‘all-inclusive’ pricing, attempts to bring together complementary products into a single-offering where the final price is lower than the combined price of the components if sold (and purchased) separately (9). That’s the case for season tickets as the season ticket buyer achieves a lower per-ticket cost than buying tickets for each game as an individual transaction. However, many fans are unwilling/unable to make such a financial commitment. In response, ticket mini plans have been developed to provide access to fewer games at a lower total price. And, some collegiate athletic programs have developed All Sports Passes and Olympic Sports Passes in an attempt to build ticket sales (and fan followings) for those sports. The goal of all such programs is to simultaneously increase total revenue and total fan attendance.
To date, there’s a little-used price bundling strategy among collegiate athletic ticketing offices; namely, the development of a Multi-Sport Sampling Plan which provides the ticket buyer access to at least one game for multiple sports (i.e., one football game, one basketball game, etc.) at lower prices. Such a sampling plan may help an athletic department to develop a loyal fan following among formerly non-ticket buyers. And, fans who have a positive experience at one sport (say, a football game) may be more likely to try their next sport (say, a basketball game). Marketers consider this both a Market Development (increase sales of existing products/tickets to new buyers) and Market Penetration (increase sales of existing products/tickets to existing buyers) growth strategy (11).
The purpose of this manuscript is to examine the concept of a Multi-Sport Sampling Plan (a price bundle) for possible use by collegiate athletic ticketing offices and professionals. Such a plan may contribute to growth in both revenue and fan attendance. First, a review of relevant price bundling research is provided with a focus on hospitality research. Second, a look at two common approaches to price bundling is offered. Third, some market factors that could aid in the successful develop of such a plan are discussed. Finally, some implementation issues are addressed and advice offered for collegiate athletic ticketing professionals who may wish to move forward with such programs.
Literature Review
Price Bundling
Price bundling is the practice of offering two or more products or services for a single package price. Marketers have the option of employing a mixed bundling strategy (i.e., the consumer can choose between purchasing the products and/or services individually or as a package) or a pure bundling strategy (i.e., the products and/or services are only available as a package). Applied to sports ticketing, a “mixed bundle” allows a buyer to buy all, part, or none of a season’s tickets. Conversely, a “pure bundle” offer requires purchasing the entire season ticket package. No single game tickets would be sold. Rare is the use of pure bundling in collegiate athletics. As such, the focus of this discussion will largely be on mixed bundling. There are two forms of mixed bundling (12):
1. Mixed-joint bundling involves offering a single, discounted price when multiple products and/or services are purchased simultaneously as a package.
2. Mixed-leader bundling, also referred to as tie-ins, involves offering a discounted price on an additional product or service when a specified product or service is purchased at the regular price.
Applied to sports ticketing, a ‘mixed joint bundling’ program is akin to a season ticket where the purchaser gets a lower price by committing to a larger number of contests. A ‘mixed leader bundle’, on the other hand, would allow ticket buyers from one sport (say, Football) to get a lower price when buying tickets for another sport (say, Basketball).
The economic motivation behind bundling is to increase revenue and, ultimately, profitability. Bundling increases revenue by generating increased revenue per customer transaction and/or by increasing the frequency of transactions. With mixed bundling, the customer may purchase additional products and services as components of a package that they may not have elected to purchase otherwise. This is accomplished through the transfer of the consumer surplus from the product or service highly valued by the consumer to the additional products and/or services included in the bundled offering. The consumer surplus represents the difference between the reservation price (i.e., the maximum price the customer is willing to pay for a product or service), and the actual price paid (12). So, the buyer would have paid $20 for entry into a preferred attraction but elects to buy the bundle for $30 thinking the added attractions for the marginal $10 are well worth it, particularly given the ‘good deal’ s/he received on the primary entry fee.
Let’s apply this theoretical foundation to athletic ticket purchases. Let’s assume a basketball fan rarely misses an important conference basketball game but may choose to skip a few non-conference contests against lesser opponents. This fan may choose to buy single game seats. However, s/he faces the uncertainty of ticket availability. So, they commit to the season ticket package knowing they’ll miss some games. Tickets for these non-attended games may be given to friends, donated back to the school, or simply go unused. The rationale for that fan, in layman’s terms, is “hey, I’ll see the big games, and may catch a few of the tune up games, so it’s a good deal even if I don’t see all of the games.” That is, they apply their consumer surplus to the purchase of these less-appealing games just in case they choose to attend.
The University of Virginia’s Football Ticketing Plans for 2015 provide an illustration of this strategy in action (32). Season ticket buyers were offered two options (a 3-game plan and a 7-game plan). The plans (and associated costs) are profiled in Table One.
As illustrated in Table One, the full season ticket buyer gets the ‘BIG 3’ games (Notre Dame, Boise State, and Virginia Tech) for $120 – $175 and the 4 additional games (William & Mary, Syracuse, Georgia Tech, and Duke) for $70 – $150 more.
Effective marketers must also consider the potential impact of bundling on profitability. With mixed bundling, the impact on profitability may be more difficult to accuracy determine. Revenue gains may be generated due to cross selling, which occurs when the buyer of one or more products and/or services purchases additional products and/or services as a result of the bundled offering(s). For example, football season ticket buyers become a fruitful group to approach for possible basketball season tickets. Additionally, revenue can be increased by attracting new consumers who find the bundled approach appealing. However, these revenue gains may be partially offset by sales to existing customers that may have purchased the products and/or services individually (at a higher price point generating greater revenues) but now take advantage of the bundled discount. As a result, it is important for marketers to closely monitor and estimate the cost of the ‘lost sales’ (known as “cannibalization”) that may occur as a result of a mixed bundling strategy (12).
Price Bundling in the Tourism Industry
Price bundling frequently occurs in the hospitality, travel, and tourism industry. Perhaps the most basic and frequent form of bundling occurs when a firm provides a combination of its own products and/or services as a package available to the consumer at a competitive price. For example, visitors to Seaworld Parks can save by committing to visit two or three Seaworld Parks (such as Busch Gardens, Seaworld, and Aquatica) (19). Or, quick-service restaurants include fries and a drink along with a sandwich (i.e., mixed joint bundling). Interestingly, many athletic event markets have followed this strategy by developing Family Fun Packages to include, for example, 4 tickets, 4 drinks, and 4 snacks to encourage a family to come to a game for one fixed price.
The bundling of tourist attractions within a single destination, which are operated by a variety of organizations, is much more complex than creating value meals by a single restaurant company. Similarly, an athletic department is the (assumed) owner of the ticketing rights to all sporting contests for that College or University. As such, price bundling within an athletic department should be easier to achieve than the need to bring a group of separate owners of tourist attractions together to agree to a price bundling framework.
When examining pre-picked vacation bundles, the total package price appears to be the strongest determinant of a consumer’s decision to select one package over a comparable alternative (21). The more interesting finding in this same study may be the impact of price transparency. Transparent pricing, in which the price of each package component is itemized for the consumer, may promote a perception of fairness and value when compared to opaque pricing – a package pricing alternative that provides only a total price (21). As such, price bundlers are advised to clearly show the regular price and the discounted price to be paid (along with the concurrent savings) to illustrate the value of their price bundles to encourage higher sales of such packages.
Two Approaches to Price Bundling for the Tourism Market
CityPASS and Smart Destinations, Inc. are two companies that currently provide discounted access to multiple attractions, utilizing a mixed—joint bundle format, in major cities located throughout the United States and Canada. But, each takes a distinctly different approach. CityPass offers a TARGETED SELECTION – 5-10 highly attended attractions are identified and offered for one low price for a period of time. Conversely, Smart Destinations offers a BROAD SELECTION – the larger cross-section of attractions is offered for a larger price and consumers simply choose the attractions they frequent for a defined period of time. The difference here is very clear:
1. TARGETED SELECTION – Lower price point for a smaller list of targeted attractions.
2. BROAD SELECTION – Higher price point for a larger list of targeted attractions.
Targeted Selection Approach (CityPASS)
CityPASS is a privately-owned company that offers bundled pricing on a small or targeted list of attractions in 12 major U.S. and Canadian cities. CityPASS identifies the top attractions in a market and then offers visitors a chance to visit all of these targeted attractions (4-7 attractions per city) for one low price. Buyers typically save approximately 50% off of separately-purchased admission. The firm notes that more than one million ‘happy travelers’ use CityPASS each year. Based on the firm’s website, CityPASS customers report a 99 percent customer approval rating. And, rated on a 5-point scale, the firm receives at least 4.70 / 5.00 in all twelve markets served. To date, over 13 million people have purchased a CityPASS in at least one market served (7). This number suggests a growing interest in a price bundled option among travelers. Table Two provides an overview of CityPass Chicago for illustration purposes.
Broad Selection Approach (Smart Destinations)
Smart Destinations is a privately-owned company that offers its “GO CITY CARDS” in 10 American cities. Unlike CityPASS, the GO CARD identifies a larger list of area attractions and buyers choose the number of days they will have to visit attractions on the list. Buyers typically save approximately 50% off of separately-purchased admission. Table Three provides a pricing overview of the GO CHICAGO Card as the city is included in the bundling offerings of both organizations. The key difference is the GO CHICAGO Card includes 20 attractions, including those represented on the CityPASS offer (Shedd Aquarium, Field Museum, etc.) and others such as Brookfield Zoo, Chicago River Cruises, Museums, and Theater Tours (20).
Applying Tourism Price Bundling to Collegiate Athletics
In his well-known seminal piece in the Harvard Business Review titled “Marketing Myopia”, Professor Ted Levitt (14) warned marketers to avoid myopia in defining their markets, consumers, product uses, reasons for buying, and other consumer-related matters. Extended to athletics, today’s sports marketers well-recognize they are offering an entertainment option in a crowded marketplace.
Against this backdrop, we can look at each sporting event as part of a larger portfolio of entertainment offerings to be sold. A broad-based athletic department may offer 100 or more ‘events’ or home athletic contests each year. And, price bundling is a common practice in collegiate sports. As shown in Table Four, a review of current practices of collegiate sports marketers illustrates application of both TARGETED SELECTION and BROAD SELECTION approaches in sporting event ticketing.
Targeted Selection Approach
The development of Mini Plans and Game Ticket Voucher Booklets are two common applications of the Targeted Selection (i.e., CityPASS) model. While fans can still purchase both single game seats and full season ticket packages, schools have elected to bundle a pre-selected portion of the season into Mini Plans to appeal to fans looking for lower cost solutions or simply interested in attending few games or specific games. Similarly, the Game Ticket Voucher Booklets gives fans flexibility by pre-paying for a pre-determined number of games and then later choosing which specific games to attend. Some examples are provided below.
College Football Examples. A typical college football team plays 5-7 home games per year. Many schools offer Mini Plans with targeted games included. For example, the University of Oregon (29) included tickets to games with USC, Oregon State and Georgia State in a 3-game bundle. The University of Pittsburgh (30) offered a 3-game Mini Package with 4 different options for Men’s Football in 2015:
1. Youngstown State + 2 ACC Opponents
2. Youngstown State + Notre Dame + 1 ACC Opponent
3. 3 ACC Opponents
4. Notre Dame + 2 ACC Opponents
Similarly, Purdue University (17) offered both a 2-game and 3-game plan. The 2-game Prime Mini Plan included admission to: (1) Virginia Tech OR Nebraska game; and (2) ANY remaining game. The 3-Game Touchdown Mini Plan simply added the option of 2 REMAINING games in addition to the choice of Virginia Tech OR Nebraska. Mississippi State (15) kept their Mini Plan simple by comparison by including tickets to 3 games with likely lesser-demand for tickets (Troy, Louisiana Tech, and Kentucky).
Washington State (35) offered a twist with their 48-Hour Pack based on feedback from their fans. Here, fans purchase an open-ended 3-game voucher and can choose from any home football game. However, the time window to choose a game to attend is limited to the 48 hours after the starting time for that game is finalized by the conference (typically 10 days before the game). Ticket holders are alerted via email that their ’48 hour clock’ is now ticking for that contest. They can then ‘commit’ to redeeming a voucher for that contest.
College Basketball Examples. A typical college basketball team plays 12-18 home games per season. A larger number of home contests may likely lead to the development of more mini plans. For example, the University of Washington (34) developed both a 6-game ‘weeknight’ and ‘weekend’ bundle for Men’s Basketball.
Basketball is unique is that the season straddles the Fall and Spring semesters, with the Winter Holiday Break in between. This means that schools often have games in December (and possible the Thanksgiving break) where the students are not on campus. As such, schools often create bundles to help build demand for these ‘school is out’ contests. For example, Coastal Carolina University (8) offered a 4-game Hoopla Mini Plan for 2015 Men’s Basketball that included two “end of Fall semester” games (Auburn and Radford) and two Winter Holiday games (Winthrop and Liberty). Campbell University (6) designed a similar 6-game Mini Plan with 3 games after the end of the Fall semester (non-conference games) and 3 games spread over January and February (conference games). Interesting, all 6 opponents had a mascot of Cat or Dog (Wildcats, Bulldogs, etc.) which lead to the name “Cats & Dogs Mini Plan.” Finally, Ohio State University (22) offered 4- and 8-game mini plans where fans choose half of the tickets from games in November-December and the other half from games in January-February.
Butler University (4) offered a form of a sampling plan in 2015 in the Starting Five Mini-Plan, a program where fans received one premium, one value, and 3 additional regular or value games. During the same season, Butler offered the All-American Min-Plan which included two games against state military colleges (The Citadel and Virginia Military Institute or VMI) and a choice of any other game on the home schedule. Table Five illustrates their breakdown of the schedule into Premium, Value, and “Regular” Games.
Boston College (2) did not expressly label their schedule as such but their 2015-16 Basketball Plans (Duke or UNC 5-Game Flex Pack) was somewhat similar. Buyers received access to one PREMIUM games (Duke OR North Carolina), two REGULAR games (Notre Dame, Miami, Florida State, Syracuse, Virginia Tech, Georgia Tech, and Clemson, and two VALUE games (Penn State, UMASS Lowell, Maine, Delaware, and New Hampshire). Purdue University’s 2015 Men’s Basketball Mini Plan combined these elements into a 5-game bundle (17). This is presented in Table Six.
College Baseball Examples. College Baseball teams play many more games than, say, Football or Basketball. And, 20-35 of these games may be played in their home stadiums. As such, many fans may be unable to attend all games. The sale of Game Ticket Voucher Booklets is a very common strategy. As an example, the University of Virginia (33) sold a 10-game Mini Plan during the 2015 season. There were no restrictions on which games a fan could attend. However, seating was limited to general admission seats on a first-come, first-served seating priority system. Coastal Carolina, given its location in the Southeast, plays host to many colder-climate teams early in its Baseball season. After the part of their schedule is complete, the school typically sells a ticket bundle for its March-April-May schedule of conference and mid-week games (8).
The University of Oregon (28) provided a Mini Plan for Baseball in 2015 that only included conference games (i.e., The Pac-12 Pack): Arizona St.; Oregon St.; Washington; Stanford; and UCLA. Further, they offered a single ticket to one game in each home series in the month of April (games with Michigan State, Oregon State, and Washington). And, the University of Arkansas (23) offered both a “Friday Bundle” and “Saturday Bundle” for conference games during its 2015 Baseball season.
College Hockey Examples. A typical college Hockey team plays 15-22 home games per season. This number is slightly higher than the number of home Basketball games but lower than the typical number of home Baseball games. Boston College crafted the “BU 5-Game Flex Pack” for Hockey that is comparable to their Basketball Mini Plan (3). Specifically, fans get tickets to: (1) the Boston University (BU) game; (2) a choice of the Northeastern, Notre Dame, Providence, or UMASS Lowell games; and (3) a choice of the RIT, UCONN, New Hampshire, and Merrimack games. UMASS Lowell (25) offers the River Hawk Hockey Mini Plan. Here, fans get seats to 2 rival games (Providence, Boston University, or Boston College) and 3 other regular season contests (University of Connecticut, Massachusetts (2 dates), Arizona State (2 dates), Northeastern, or New Hampshire.
Broad Selection Approach
The development of All Sports Season Passes and Olympic Sports Season Passes are two common applications of the Broad Selection (i.e., Smart Destinations) approach. Borrowing from the common High School Sports strategy, All Sports Season Passes are offered by some institutions, typically smaller institutions below the NCAA Division I level. The University of Nebraska Kearney (27), for example, offered an All Sports Pass for $150 to $225 per person depending on seat selection. However, a family of four could pay $350 for the Runza Family Pass and see all home Football, Volleyball, Soccer, Basketball, Wrestling, Track and Baseball games. Cal State Monterrey Bay (5) offered the $100 Family All Sports Pass good for general admission to all regular season home games. Faculty/staff and military discounts were also offered.
To be clear, many larger institutions such as BYU, Oklahoma State, and others provide All Season Sports Passes to their students. And, the University of Nevada Reno provides their passes at no cost to all new undergraduate students for their first year. However, such All Sports Season Passes seem less likely at Division I (i.e., Power 5 or Group of 5) institutions. It must be noted that not all athletic competitions are ticketed events. Coastal Carolina University (8), for example, tickets 4 athletic contests (Football, Men’s Basketball, Women’s Basketball, and Baseball). All other athletic contests are free to the public.
Many institutions have created specific ticket bundles for their “Olympic Sports”, which tend to experience lower attendance than sports such as Football, Basketball, and Baseball. For example, the University of Kentucky (24) offered its Olympic Sports Pass ($25 individual or $100 for a family up to 5 members) for Baseball, Softball, Gymnastics, Soccer, and Volleyball. The University of South Carolina’s Olympic Sports Pass (31) covered Soccer, Softball, and Volleyball. It should be noted that South Carolina won the NCAA Division I Baseball Championship in 2010 and 2011. With no professional Baseball team in Columbia, SC, the ticket demand remains very high. This may help explain why Baseball is NOT included in their Olympic Sports bundle compared to the University of Kentucky (which has not enjoyed the same level of success in Baseball in recent years).
The Multi-Sport Sampling Plan: An Opportunity for Collegiate Athletics
While some collegiate athletic marketers have used the TARGETED SELECTION approach (Mini Plans and Game Ticket Voucher Booklets) and BROAD SELECTION approach (All Sports Passes and Olympic Sports Passes), there is a little-used alternative for their consideration. That is, very few institutions have offered a Multi-Sport Ticket Bundle or Mini Plan. This would be another application of the TARGETED SELECTION approach by allowing ticket buyers to redeem vouchers for tickets (a set number) to one game per sport.
• 1 Football Game
• 1 Men’s Basketball Game
• 1 Women’s Basketball Game
• 1 Baseball Game
• 1 Volleyball Game
• 1 Hockey Game
Additionally, quantity discounts could be developed to include 2-4 tickets to each chosen game/sport to appeal to couples or families. Such a plan would provide a fan access to a cross-section sample of the collegiate sports offered by the University. These new ticket buyers would become a prime target audience for subsequent ticket purchases. And, it is reasonable to think that many fans would purchase concessions and merchandise (i.e., caps and t-shirts) during their game day experience.
The only recent example of such a plan to be found was offered by the University of Minnesota in 2015 (26). Specifically, fans could choose from three different Multi-Sport Ticket Packages. They are profiled in Table Seven. It should be noted that the University of Minnesota has been more active than other institutions in offering within-sport bundles in Volleyball, Women’s Hockey, Men’s and Women’s Basketball, and other sports (26).
(Insert Table Seven about Here)
This is exactly the model for CityPASS travelers. That is, ticket holders simply show up at the attraction and exchange the coupons in their voucher book for admission to the attraction. Using a Multi-Sport Sampling Plan, ticket holders would be given access to one event per sport (one Football game, one Basketball game, one Baseball game, etc.). As illustrated above, the University of Minnesota model uses variable pricing as the total cost is determined by the specific games selected. Another approach would be a fixed price model in which the buyer can redeem their vouchers for any game, regardless of opponent.
Research in the diffusion of innovations has identified the relative success factors for new products that make a new item more likely to be adopted by consumers (11,18):
• Relative Advantage – the product/service is perceived as a better alternative to other substitutes.
• Trialability – the product/service can be tried with minimal risk/cost.
• Compatibility – the product/service is consistent with existing behavioral norms.
• Complexity – the product/service can be easily understood.
• Observability – the product/service can be easily observed and its benefits easily communicated to others.
It is suggested here that a Multi-Sport Sampling Plan may be an effective way to introduce a school’s athletic program to new users (ticket buyers) by addressing the new product success factors in the following way:
• Relative Advantage – ticket buyer has flexibility and does not have to commit to a particular game for the initial game day experience.
• Trialability – ticket buyer can have an initial game day experience at a lower price before committing to mini plan or season ticket packages.
• Compatibility – ticket buyer can have an initial game day experience to see if they like the arena, parking access, fan behavior, concessions, and other fan elements.
• Complexity – ticket buyer can see ticket options first-hand by attending a game or contest. This makes later ticket purchase less intimidating. Also, the fan may elect to attend a lesser-attended game to do a ‘test drive’ of the game day experience with fewer people, vehicles, and so on.
• Observability – ticket buyer can experience game day in-person and decide if they’d like to make a larger commitment to purchase tickets and join that fan community.
Continuing this stream of thought further, the College or University could combine their Cultural or Performing Arts programs into such a bundle by adding “one Student Art Performance or Play,” or “one Student Musical Program.” Such programs would allow buyers to become familiar with more University programs. From this sampling plan, it is likely that some percentage of buyers would be converted to single performance or season ticket buyers for Cultural Arts programs in the future.
Local Market Conditions and Implementation Issues
The Presence of Excess Capacity Seating for Sporting Events
If an athletic ticket office tends to have excess seating capacity for some athletic contests, it can fill (i.e., sell) some of these seats by developing a Multi-Sport Sampling Plan. And, given the fact that the marginal cost of serving an additional fan is minimal, the school should be willing to accept a reduced ticket price (say, $10) rather than realize no revenue for that seat. It is assumed the department is covering its fixed costs with its current fan base and, therefore, can benefit from the marginal revenue of these new fans without incurring any marginal costs to serve them. And, it is likely that some of these new spectators will purchase concessions and merchandise while at the event.
Further, a sampling plan that allows for early season attendance may create the opportunity to sell that fan a mini plan or single-game seats for later season contests. This is particularly true for longer seasons where teams play more regular season games (such as basketball or baseball as opposed to football).
The Presence of a Large Number of Newly-Relocated Residents
Collegiate athletic programs located in geographic areas that are seeing an increase in relocated residents (such as the Carolinas, Florida, Texas, Arizona, etc.), particularly college graduates, may find the development of Multi-Sport Sampling Plans particularly fruitful as these new residents often leave the geographic areas of their alma maters. These new residents may enjoy collegiate athletics but be unable to return to their ‘primary fan’ schools given the travel distances. In such cases, these new residents can ‘adopt’ the local school and enjoy the local fan experience while keeping their allegiance to their beloved alma maters. A Multi-Sport Sampling Plan encourages them to do so as a lower cost.
Consider an example Syracuse Fan who relocates to the Carolinas. The travel distance to Upstate New York makes it less likely for them to return to campus frequently. Therefore, these new residents may be receptive to a ticket offer to join the fan base of their new local College or University. And, it allows parents of younger children to share the fan and game day experience with their children by attending local games (at lower prices and at much reduce travel times and costs).
The Presence of Older Fans
As noted earlier, athletic events must compete with other entertainment options in the marketplace. Older fans, possibly retirees who have relocated to a new area, may be receptive to a Multi-Sport Sampling Plan that offers a series of events and fan experiences in their new communities. These residents often find college sports to be a good consumer value. They enjoy the connection to the student-athletes. And, the sporting event often becomes the anchor of the day’s events (that is, something to do that day). These older residents (and fans) may become very interested in other University offerings such as Music and Theater events.
The Addition of New (and Possibly Unfamiliar) Collegiate Sports
The growth in selected sports could be enhanced by their inclusion in a Multi-Sport Sampling Plan. For example, Women’s Lacrosse continues to spread from the mid-Atlantic to other parts of the United States. However, many southern athletic conferences do not yet have enough conference members that play the sport to host a conference championship to sponsor that sport. Consequently, schools often become affiliated members of other conferences for that sport. For example, the Atlantic Sun Conference (1) has grown from 5 schools in 2012-13 to 11 teams by 2017 in Women’s Lacrosse. In this case, schools in new areas for lacrosse (South Carolina, Georgia, and Michigan) have been added. Fans of these newly-added schools are less likely to be familiar with Lacrosse. In these cases, a sampling plan allows fans to try the sport at a lower cost, thus overcoming the issue of ‘trialability.’ This may lead to subsequent attendance (and ticket purchases) in later season contests.
The Potential to Partner with Cultural Arts Organizations on Campus
The development of a price bundle is more easily done when the same firm owns and operates all the attractions. Though they may have separate profit/loss responsibility, the various components of a collegiate community (such as Athletics, Performing Arts, etc.) do (ultimately) work for the sample employer … the College or University. The ability to partner with Cultural Arts Organizations may be a win-win opportunity to bring more local residents to campus for more reasons. Over time, this may promote a greater sense of engagement with local residents and their local College or University.
Moving Toward Implementation
Moving toward implementation, there will be many important decisions to address. The following guidance is offered to athletic ticketing professionals:
• Choose a name for the ticket bundle that is relevant to your institution. For example, the phrase “Ski-U-Mah” (used by the University of Minnesota since 1894) is a combination of a Sioux Battle Cry meaning victory and U-MAH (shorthand for U of Minnesota) (26). In fact, there is a semi-monthly Athletic Department publication by the same name.
• Establish a reasonable number of ticket bundles to sell as your Year One goal. The number of ticket bundles to be sold will be a function of the number of seats that typically go unsold for the selected sports. It is recommended that some smaller figure (say, 100, 250 or 500 tickets) be used for introduction of the program. If these tickets sell quickly, this indicates wide fan acceptance of the price bundle and future attendance at your games.
• Track your Multi-Sport Sampling Plan buyers. The development of your ticket bundle can introduce new fans to your programs while positioning them for later ticket purchases. As such, it is imperative that these buyers are identified, tracked, and contacted for possible follow-up purchases (i.e., the conversion rate).
• If needed, exclude selected games for redemption. It is possible that your teams have some marquis games or local rivalry games that see higher attendance. If needed, exclude these games from the ticket bundle to ensure adequate seating for your rival games.
• Determine the timing of program introduction. The discussed Multi-Sport Sampling Plans could be introduced at the beginning of the academic year (sold over the Summer for Fall redemption) or Calendar year (sold in Fall/Winter for Spring redemption). The ticket bundle may be positioned as a holiday gift giving idea.
• Provide a year-round sports sampling experience. A Multi-Sport Sampling Plan is intended to introduce a cross-section of sports to these new fans. Ideally, the plan will include sports in all-seasons, including Fall (Football, Volleyball, Soccer), Winter (Men’s Basketball, Women’s Basketball), and Spring (Baseball, Softball).
• Determine Single versus Multiple Ticket Packages. Given that buyers for such bundles are likely in self-selected groups (couples, families, etc.), any such Ticket Sampling Plan could be developed as a single ticket or required quantity purchase (2 for couples, 3 or more for families, etc.)
• Determine the amount of price mark-down to encourage sales. As discussed, one goal of such programs is to lower the cost of introducing a new fan to your programs. CityPASS typically offers buyers 40-50% savings. The exact amount of savings must be determined. If, for example, tickets to 4 events (Football, Men’s Basketball, Women’s Basketball, and Baseball) regularly cost a total of $50, a $25 or $30 price point for the Multi-Sport Sampling Plan may be a sufficient price reduction to appeal to the local fans.
• Focus on athletics for introduction of the price bundle. As discussed, an institution’s Cultural Arts programs may be a possible addition to a price bundle. However, to simplify the introduction of a sports ticket price bundle, it is recommended that option be held back to Year Two to keep the focus on athletics. It should be noted that your peers in the Cultural Arts programming may wish to develop their own multi-performance bundles. And, they will appreciate the sharing the contact information of the sports pass buyers so they can target these same consumers. But, for simplicity, keep the focus on athletics for the initial program development and introduction.
As illustrated above, the development of a Multi-Sport Sampling Plan is an application of the successful TARGETED SELECTION approach to price bundling in the hospitality industry. The development of such a ticket offer will allow new ticket buyers to become more familiar with an institution’s athletic programs, facilities, and student-athletes. It will address the issue of ‘trialability’ in new product introduction by allowing buyers to sample the programs at a lower price. And, it will encourage the development of new relationships with new fans, many of whom will elect to make subsequent purchases of tickets as a result of their positive game day experience.
This little-used price bundling strategy is highlighted for consideration by collegiate athletic ticketing professionals looking to increase revenue while concurrently increasing fan attendance in current and future periods. Some percentage of ‘sampled fans’ will be converted to later ticket buyers. Further, these ‘sampled fans’ will likely buy concessions and merchandise on game day. That’s a win-win relationship. The development of a Multi-Sport Sampling Plan is a growth strategy offered for your consideration.
REFERENCES
1. Atlantic Sun Conference (2015). A-SUN adds coastal carolina as women’s lacrosse affiliate. Retrieved from: http://atlanticsun.org/sports/wlax/2015-16/releases/20151022icw59r
2. Boston College Athletics website (2015a). Retrieved from: http://ev9.evenue.net/cgi-bin/ncommerce3/SEGetPackageInfo?packageCode=GS%3AIBM%3A%3ADUKEUNC%3A&linkID=bostoncoll&shopperContext=&caller=&appCode=
3. Boston College Athletics website (2015b). Retrieved from: http://ev9.evenue.net/cgi-bin/ncommerce3/SEGetPackageInfo?packageCode=GS%3AIBM%3A%3ABU5PACK%3A&linkID=bostoncoll&shopperContext=&caller=&appCode=
4. Butler University Athletics website (2015). Two mini-plan ticket options available for 2015-16 @ButlerMBB Season. Retrieved from: http://www.butlersports.com/sports/m-baskbl/2015-16/releases/20150923jvutpc
5. Cal State Monterrey Athletics website (2015). Retrieved from: http://www.otterathletics.com/sports/2008/12/18/Tickets.aspx
6. Campbell University Athletics website (2015). Retrieved from: http://www.gocamels.com/tickets/index
7. CityPASS website (2015), www.citypass.com
8. Coastal Carolina University Athletics website (2015). Retrieved from: www.goccusports.com
9. Ferrell, O.C. and Michael Hartline (2011). Marketing Strategy (5th Edition). South-Western Cengage Learning: Mason, Ohio.
10. Fullerton, Sam (2007). Sports Marketing. McGraw-Hill/Irwin: New York, NY.
11. Grewal, Dhruv and Michael Levy (2015). M Marketing (4th Edition). McGraw-Hill: New York, NY.
12. Guiltinan, Joseph (1987). The price bundling of financial services: a normative approach. Journal of Marketing, 51, 74-85.
13. Knight Commission on Intercollegiate Athletics (2014). College sports 101. Retrieved from: http://www.knightcommission.org/collegesports101/table-of-contents
14. Levitt, Theodore (1960). Marketing myopia. Harvard Business Review, 38 (4), 45-56.
15. Mississippi State University Athletics website (2015). Retrieved from: http://www.hailstate.com/ViewArticle.dbml?DB_OEM_ID=16800&ATCLID=208834962
16. National Collegiate Athletics Association (2009). 2004-06 NCAA revenues and expenses of division I intercollegiate athletics programs report. Retrieved from: http://www.ncaapublications.com/productdownloads/RE2008.pdf
17. Purdue University Athletics website (2015). Retrieved from: http://www.purduesports.com/tickets/tickets-m-footbl.html
18. Rogers, Everett (1983). Diffusion of Innovations. New York: The Free Press.
19. Seaworld Parks website, http://seaworldparks.com/
20. Smart Destinations website, www.smartdestinations.com
21. Tanford,S.; Erdem, M.; Baloglu, S. (2011). Price transparency of bundled vacation packages. Journal of Hospitality & Tourism Research, 35(2), 213-234.
22. The Ohio State University Athletics website (2015). Retrieved from: http://www.ohiostatebuckeyes.com/tickets/m-baskbl-miniplan.html
23. University of Arkansas Athletics website (2015). Retrieved from: http://www.arkansasrazorbacks.com/baseball-mini-plans-now-on-sale/
24. University of Kentucky Athletics website (2015). Retrieved from: http://www.ukathletics.com/page/tickets-olympic-sports
25. University of Massachusetts Lowell Athletics website (2015). Retrieved from: http://ev9.evenue.net/cgi-bin/ncommerce3/SEGetEventInfo?ticketCode=GS:GLOBAL-LOWELL:RH15:RHMINI15:&linkID=global-lowell&shopperContext=&pc=&caller=&appCode=&groupCode=RH5PACK&cgc
26. University of Minnesota Athletics website (2015). Retrieved from: https://www.mygophersports.com/Online/default.asp?BOparam::WScontent::loadArticle::permalink=seasons&BOparam::WScontent::loadArticle::context_id=
27. University of Nebraska Kearney Athletics website (2015). Retrieved from: http://unknews.unk.edu/2014/07/10/season-tickets-on-sale-for-2014-15-loper-athletics/
28. University of Oregon Athletics website (2015a). Retrieved from: http://www.goducks.com/ViewArticle.dbml?ATCLID=1513556#mini
29. University of Oregon Athletics website (2015b). Retrieved from: http://www.goducks.com/ViewArticle.dbml?&&DB_OEM_ID=500&ATCLID=22723
30. University of Pittsburgh Athletics website (2015). Retrieved from: http://www.pittsburghpanthers.com/tickets/pitt-3-game-mini-package-m-footbl.html
31. University of South Carolina Athletics website (2015). Retrieved from: http://www.gamecocksonline.com/tickets/ticket-prices.html
32. University of Virginia Athletics website (2015a). Retrieved from: http://www.virginiasports.com/tickets/footbl-ticket-info.html
33. University of Virginia Athletics website (2015b) Retrieved from: http://www.virginiasports.com/tickets/basebl-ticket-info.html#mini
34. University of Washington Athletics website (2015). Retrieved from: http://www.gohuskies.com/ViewArticle.dbml?DB_OEM_ID=30200&ATCLID=210433917
35. Washington State University Athletics website (2015). Retrieved from: http://www.wsucougars.com/ViewArticle.dbml?&DB_OEM_ID=30400&ATCLID=209390214
