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First pitch case competition mc gill submission
1. First Pitch Case Competition
Desautels Faculty of Management – McGill University
Jorge Tatto, Deepti Kaul & Christian Mathews-Gagné
2. Executive Summary
I. NBA fans’ needs and wants are changing – current season ticket model does not offer
enough flexibility to be accessible to all
II. Millennials are spending more time on digital devices, which they increasingly
incorporate into all of their activities
III. On average, 23% of season ticket holder’s seats from the sample were left empty
IV. Untapped revenue opportunities continue to exist that can be exploited by both
Ticketmaster and the NBA
V. Data is playing an increasingly important role in ticketing. Ensuring quality
information is collected from fans is essential.
SeatShare & Flex-Pass:
Innovative ideas that give fans a range of flexible options
Dynamic Pricing Tools:
To empower fans to take more control of their tickets
LeapFrog:
A tool that puts seat upgrades in the hands of the fan
Social & New Tech:
Engaging the modern fan in the channels they inhabit
Ticketmaster Club:
A loyalty program to reward the fans and cross-sell other events
1
Our recommendations play to
Ticketmaster’s strengths –
drawing on both its size and
collective knowledge to bring
forth innovative solutions
designed to delight both
partners and fans alike.
Reimagining season tickets
2
3
4
5
Optimizing the secondary market
Maximizing the fan experience
Key
Findings
3. Ticketmaster must innovate & respond to new offerings from
key competitors that present a veritable threat
Competitive Landscape
• Integrated
platform
• Wide variety
of offerings
• Ties to NBA
• Focused on
continuous
innovation
•MLB subsidiary
•Threat to
current
Ticketmaster
contracts
• Access to
other MLB
services like
the Ballpark
app
• Low-cost
model
• Actively
acquiring +
acqui-hiring
• Innovative
offerings for
promoters
• Freemium
option
• Secondary
market
leader
• Key partners
• Rewards
program
• Working on
added social
integration
4. The modern NBA fan will be a highly connected & socially
motivated individual accessible through many channels
+7% of NBA fans play fantasy sports - a
higher percentage of the fan demographic
from the NFL
40% are more likely to use a mobile device
to access their social networks
Online activity to access stats & specifics
about teams and players has increased by
+66% since the 2012-2013 season
Sports programming accounts for 1% of all
television content yet accounts for 50% of
tweets that are sent about television
content
Key Demographic Insights
75%
Of the workforce in the U.S.
will be comprised of Millennials
by the year 2018
5. Ticketmaster’s current offering has enabled them to keep
the competition at bay
Current Situation
Secure Platform Data Capabilities
Technological ProwessMarket Presence
Ticketmaster has grown to
become the most relevant
player in the market, allowing
them to secure highly profitable
exclusive partnerships with
both teams and venues.
Ticketmaster Verified Tickets is
an advanced security feature
for reselling and transferring
tickets. Fans can trust and rely
on Ticketmaster to obtain
authentic tickets.
The interactive seat map
uniquely integrates the
primary and secondary
markets. It provides
transparency for fans and a
competitive advantage over
competitors who only operate
in one specific market.
Live Nation and Ticketmaster
are able to provide a truly
targeted offering through the
use of data. From event
discovery to integration with
other platforms, Ticketmaster
allows fans to stay connected.
6. Three key opportunity areas to act on: the season ticket
model, the secondary market and the fan experience
Opportunity Statement
SeatShare allows fans with common interests to share the
cost of a season ticket
Flex-Pass provides season ticket holders who purchase this
option with periodic seat upgrades
Dynamic pricing & pricing tips for the secondary market
will ensure more tickets are sold in both markets
LeapFrog allows fans to bid on unused seats in the stadium
once the game has begun
Social allows fans to stay connected with friends and improves
event discovery
New tech engages fans both new and old in innovative ways
Loyalty rewards fans and encourages them to attend more events
The needs of modern NBA
fans are not being met
with current season ticket
model
Unused tickets represent a
missed profit generation
opportunity for fans,
Ticketmaster, and the NBA
Changing NBA fan
demographics and
proliferation of digital
technology require
continuous innovation
CHALLENGES ACTIONABLE RECOMMENDATIONS
7. 1. SeatShare and Flex-Pass bring flexibility to the existing
Season Ticket model
• SeatShare: allow friends or strangers to share a
season ticket. Ideal for fans that cannot attend all
games and are willing to pay a small premium for the
convenience of pre-booking their share of seats.
• Step 1: fans get matched by Ticketmaster based
on similar seat and budget preferences
• Step 2: Tickets are divided amongst seat-sharers
• Step 3: Attend the game or resell tickets on
secondary market
• Flex-Pass: A season ticket with flexible seating
assigned by Ticketmaster based on demand for the
event. Fans pay a small premium for the option to be
periodically upgraded.
AssessmentConcept
Recommendations
•Increased number of season ticket holders and
attendees for each game
•Increase profit per game
Benefits to NBA
•Provides flexibility and convenience that fans
seek
•Helps build a stronger fan community
Benefits to Fans
•Extracting consumer surplus with different
options and price points
•Taps into previously unattainable customers
Benefits to
Ticketmaster
•Utilize Live Nation’s expertise in ticket pricing
to optimize SeatShare and Flex-Pass prices
Leveraging Live
Nation’s
Capabilities
•SeatShare fans will be matched into groups
through Ticketmaster’s digital platforms
•Flex-Pass holders get notified of ticket upgrades
on game-day on Ticketmaster mobile app
Digital
•Leverage fan data to enhance pricing
mechanisms, thereby generating more revenue
for teams
Long Term
Sustainability
Synergies:
By utilizing social media
platform integration,
SeatShare can also be
available to friends interested
in sharing a season ticket
Profit:
These recommendations appeal
to millennials while charging a
premium over regular season
tickets. They create value for
Ticketmaster, the teams and
fans
8. 2. Dynamic Pricing and Pricing Tips maximize revenue for all
parties in the secondary market
Notify season ticket holders of upcoming games. If they
are unable to attend, with the click of a button, they
can post their tickets on the secondary market and
decide between two pricing methods:
AssessmentConcept
Dynamic Pricing Pricing Tips
Maximizes tickets sold
on secondary market
by adjusting prices
based on demand
Removes need to
continuously log on to
update prices
Easy to use: just
approve dynamic
pricing and wait for
your ticket to be sold
Recommends price
ranges to better fit
each game’s demand
Tips would change as
demand fluctuates
Minimizes risk of
tickets not sold due to
inefficient pricing
Alert seller if price is
too low compared to
other tickets
Recommendations
•Increase game attendance leading to higher
potential concession revenueBenefits to NBA
•Maximize probability of reselling a ticket
•Reduce effort selling tickets for multiple games
Benefits to Fans
•Capture more consumer surplus in secondary
market by pricing according to demand
•Increases revenue due to greater ticket sales on
ticket exchange platform
Benefits to
Ticketmaster
•Use of data and forecasting capabilities to price
tickets in the most efficient matter
Leveraging Live
Nation’s
Capabilities
•Pain-free customer experience easily integrated
across all platforms
•Alert fans of upcoming games, educate on
efficient pricing, notify when sold
Digital
•Network effect creates strong barrier to entry
•Integrated ticket selling platforms paired with
verified Ticketmaster security capabilities make
the model hard to imitate
Long Term
Sustainability
Synergies:
Live Nation’s pricing
capabilities will ensure an
efficient equilibrium between
primary and secondary
markets
Profit:
If all tickets from the dataset
provided had been sold in the
secondary market at face value,
Ticketmaster would have made
over $900,000 by charging a
26% service fee
9. •Creates previously unexplored revenue stream
•Filling premium seats is good for the NBA image
Benefits to NBA
•Can securely bid, pay and claim ticket
•Empowers fans by letting them bid the amount
that fits their willingness to pay
Benefits to Fans
•Generate more revenues from fans who are
already at the game
•Developing a previously untapped revenue
stream in which competitors are entering
Benefits to
Ticketmaster
•Technological infrastructure and data analysis
capabilities to facilitate bidding process on app
Leveraging Live
Nation’s
Capabilities
•Fans could log on to arena Wi-Fi and utilize
their mobile devices such as smart phones,
tablets, and smart watches to conveniently bid
Digital
•The number of fans Ticketmaster has access to
over its app is a big advantage that would be
hard for competitors to replicate
•Extensive resources are needed to execute this
complex service
Long Term
Sustainability
3. LeapFrog extracts additional consumer surplus from
ticket holders
AssessmentConcept
STEP
01
Game Starts
Ticketmaster identifies
unattended tickets and
notifies owner on
Ticketmaster app to put
their seats up for auction.
End of 1st Quarter
Bid process starts: Participating
fans bid for ticket upgrades.
Winners new tickets appear on
their mobile device and they
can move to their new seats.
Rest of Game
Fans can enjoy their new seat
along with any perks included
in their new section, enhancing
the experience.
STEP
02
STEP
03
This system allows Ticketmaster and NBA to generate
last minute revenues from unused tickets.
Recommendations
Synergies:
The software can identify if
bidder has any friends in that
specific game and find seats
close to them, further
enhancing the social
experience
Profit:
By providing a last-minute
service for resellers who have
unsold tickets, Ticketmaster can
charge a 50% commission on the
price payed through bidding
process
10. eSports & videogames: Become official ticket seller for
eSports tournaments and cross-sell NBA tickets.
Daily Fantasy Sports: A new platform where interaction
is possible with highly engaged fans. Ticketmaster can
send targeted offers to fans based on their DFS profiles.
Virtual Reality: Invest in new VR technologies applicable
to current offering. Examples include:
• VR in-game experience for fans
• VR map of venues for seat selection and purchase
•Engaging a wider audience by appealing to new
demographics
•Greater exposure to different up-and-coming
platforms on which NBA content is consumed
Benefits to NBA
•Ticketmaster can provide bigger audiences and
facilitate discovery in new technology ventures
that enhance experiences for fans
Benefits to Fans
•Collecting more data
•Being where the fans are
•Increasing sales via cross-selling initiatives
Benefits to
Ticketmaster
•Extensive entertainment industry knowledge
and ability to appeal to a wide range of
consumers
•Can facilitate development of VR capabilities
Leveraging Live
Nation’s
Capabilities
•Ensure technological infrastructure is present to
accommodate new digital tools across existing
digital platforms
•Needs to be user-friendly for all audiences
Digital
•Strong partnerships and data obtained will
make it impossible for competitors to offer
similar experiences to fans
Long Term
Sustainability
4a. Incorporating new technologies into Ticketmaster’s
existing interface will maximize fan experience
AssessmentConcept
Recommendations
Synergies:
By utilizing recent acquisitions
like Universe, Ticketmaster
can provide an adequate
ticketing service for smaller
events in the High Tech arena
Profit:
New profit sources are
attainable in non-traditional
events where sports content is
consumed. Cross-selling to live
events will further increase
profit streams.
11. Further integrate Ticketmaster’s digital presence with
social platforms to better target millennials
Facebook: New features will further integrate
Ticketmaster with Facebook. For example: add a button
for easy purchase of event tickets without navigating
away from Facebook.
Other: Integrating with social platforms such as Spotify
and theScore can provide information about users’ music
and sports preferences. This data will serve to provide
timely and targeted recommendations.
4b. Connecting fans through deeper integration of
Ticketmaster’s capabilities on social platforms
Recommendations
•Access to 360 degree information on fans and
their preferencesBenefits to NBA
•Recommendations based on their friends’
purchases ensures they don’t miss an event
•Enhanced social experience, allowing them to
connect with friends and attend games together
Benefits to Fans
•Having a call-to-action in an event discovery
tool will increase ticket sales
•Collecting valuable holistic data on fans
Benefits to
Ticketmaster
•Cross-platform integration to deliver a seamless
experience on both Ticketmaster and Live
Nation's apps
Leveraging Live
Nation’s
Capabilities
•Expanding social scope through integration with
established social platforms allows fans to
easily find, purchase and recommend events to
friends
Digital
•Integrating with up-and-coming social media
sites will ensure sustainable competitive
advantage
Long Term
Sustainability
AssessmentConcept
Synergies:
Accessing fans’ personal data
on social platforms creates a
full-bodied understanding of
their needs and wants,
allowing Ticketmaster to
develop targeted offers
Profit:
Cost savings associated to the
free “earned media”
advertising generated by fans
posting about Ticketmaster
events and features on its
behalf
12. 5. Ticketmaster Club – a loyalty program to engage &
reward season-ticket holders
AssessmentConcept
• A simple yet rewarding loyalty program that will
incentivize season-ticket holders (companies or
individuals) to attend more games and ensure they sell
their tickets if they cannot attend
• Fans will collect points if their tickets are attended
1.Rookie 2.All-Star 3.MVP
For 90%
attendance,
receive 2%
discount the
following year
during ticket
renewal
For 95%
attendance,
receive 4%
discount
For 100%
attendance,
receive 6%
discount
Recommendations
•Encourages greater attendance of games or
sales of unused tickets
•Name on Jumbotron is aspirational for fans
Benefits to NBA
•Discounts and recognition for excellent
attendanceBenefits to Fans
•Ensure unused tickets get sold in the secondary
market - especially by companies that rarely
attempt selling unused tickets
Benefits to
Ticketmaster
•Relationships with teams to provide value-
added perks that resonate with the fans
Leveraging Live
Nation’s
Capabilities
•Attendance tracked online
•Monthly email newsletter showcasing upcoming
games and attendance status
Digital
•Assess program and continue to add valued
premium perks that improve fan experience
Long Term
Sustainability
MVP season-ticket holders are recognized on
Jumbotron during game warm-ups.
Synergies:
Fans and companies that
cannot attend, can rapidly sell
tickets on secondary market
using our dynamic pricing tool
Profit:
On average 23% of season tickets
are unattended. If sold at face
value (minimum) on secondary
market, Ticketmaster would
make an additional
$1m/season/team.
13. The NBA rollout plan can serve as a benchmark for other
Ticketmaster events
Implementation
SeatShare
Today
August October
Season startsSeason startsTickets go on sale
Today
Tickets go on sale
August October
2016 Season 2017
Launch pilot to gauge demand, improve program
mechanics and test software performance
Full scale launch across league
Launch immediately, closely track seat upgrading and conduct improvements as needed to
enhance model.
Flex-Pass
Secondary market should integrate these ideas immediately, the pricing mechanism should
improve as more data is collected.
Launch pilot to test program
mechanics and ensure proper
functionality of bidding platform
Pricing Tools
LeapFrog
Social
New Technology
Loyalty
Launch feature and
advertising campaign to
educate customers
Launch now and secure partners for app integration
Launch now and continue investing in new technology developments to stay ahead of competition
Develop in-house team and analyze historic data to create precise program metrics Large scale launch
14. Concluding thoughts
Ticketmaster is the current market leader, but it faces intense
competition from large rivals with close ties to major sports leagues, as
well as newer entrants with increasingly unique capabilities.
Going forward we believe Ticketmaster should focus on reimagining the
concept of season tickets, attacking the secondary market, expanding its
integration with social networks and exploring emerging technologies.
Our proposed recommendations leverage Ticketmaster’s existing
capabilities, while positioning them to expand their offering in a way
that will facilitate a sustainable competitive advantage.
Executing on these opportunities will require Ticketmaster to invest in its
capabilities, to secure new strategic partnerships and to continuously
reassess its offerings.
Acting on the key opportunities discussed in this presentation will enable
Ticketmaster to maintain its leadership position while delivering more
value to both its partners and their fans.
15. Sources
Dataset provided
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Ticketmaster-Pulls-Back-Curtain-on-the-Ticket-Selling-Industry01262015
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