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An examination of dynamic ticket pricing and secondary market price determinants in Major League Baseball

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  • Stephen L. Shapiro
  • Joris Drayer

Abstract

•We examined market factors that influence ticket price.•Pricing determinants were focused on dynamic ticket pricing and secondary market prices.•Four regression models were developed to examine demand-based price determinants.•A variety of factors significantly influenced dynamic ticket price and secondary market price. Determinants ranged from 10 to 13 variables in each model.•Significant variables included an emphasis on team and individual performance factors, ticket-related factors, and time-related factors.Over the past several years, professional sport organizations have started to shift from cost-based ticket pricing strategies to a demand-based focus, where price considerations are driven, in part, by market demand. Dynamic ticket pricing (DTP), where prices fluctuate daily based on market factors, evolved from this transition. The motivation for DTP stems from the significant growth of the secondary ticket market, where ticket prices are almost completely demand driven. One issue with this strategy is the limited understanding of specific factors that influence dynamically priced tickets and secondary market tickets. The current study examined price determinants in the primary market where DTP has been implemented and comparable tickets in the secondary market. Four regression models were developed for this purpose. The first two models examined factors influencing dynamic ticket price. Both DTP models were found to be significant, explaining 91.4% and 70.8% of the variance in dynamic price, respectively. The second two models examined factors influencing secondary market ticket price. Both secondary market models were found to be significant, explaining 82.7% and 79.7% of the variance in secondary market price, respectively. There were many consistencies between models, including an emphasis on team and individual performance factors, ticket-related factors, and time-related factors. However, there were a number of unique aspects to each model, which may help sport managers develop pricing strategies that better reflect market demand for sport

Suggested Citation

  • Stephen L. Shapiro & Joris Drayer, 2014. "An examination of dynamic ticket pricing and secondary market price determinants in Major League Baseball," Sport Management Review, Taylor & Francis Journals, vol. 17(2), pages 145-159, April.
    • Handle: RePEc:taf:rsmrxx:v:17:y:2014:i:2:p:145-159
    DOI: 10.1016/j.smr.2013.05.002
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    Citations

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    Cited by:

    1. J. James Reade & Carl Singleton, 2020. "Demand for Public Events in the COVID-19 Pandemic: A Case Study of European Football," Economics Discussion Papers em-dp2020-09, Department of Economics, University of Reading, revised 01 Oct 2020.
    2. Daniel Megía‐Cayuela, 2023. "Valuation of ticket prices for first‐division football matches in the Spanish league," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(1), pages 576-594, January.
    3. Jung-Sup Bae & Weisheng Chiu & Sang-Back Nam, 2021. "Sport Fans’ Price Sensitivity Based on Loyalty Levels: A Case of Korean Professional Baseball League," Sustainability, MDPI, vol. 13(6), pages 1-13, March.
    4. Mehmet Şahin, 2019. "Optimization of dynamic ticket pricing parameters," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 18(4), pages 306-316, August.
    5. Jaume García & Plácido Rodríguez & Federico Todeschini, 2020. "The Demand for the Characteristics of Football Matches: A Hedonic Price Approach," Journal of Sports Economics, , vol. 21(7), pages 688-704, October.
    6. Ronald J. Huefner, 2017. "Value-based pricing in professional sports," Journal of Revenue and Pricing Management, Palgrave Macmillan, vol. 16(1), pages 30-39, February.
    7. Ryśnik Jakub, 2019. "Identification and Evaluation of Factors Influencing Sports Fan Attendance at International Events: Volleyball Case Study," Turyzm / Tourism, Sciendo, vol. 29(2), pages 123-135, December.
    8. Young Dae Ko & Seung Hwan Jung & Sung Hee Kim & Sung Wook Lee, 2018. "Sustainable Sport Scheduling Approach Considering Team Equity for the Korean Professional Baseball League," Sustainability, MDPI, vol. 10(2), pages 1-11, February.

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