#fansnap

F-commerce.

It sounds dirty but it’s really not.

One of the biggest problems in the sports business industry has been ticketing. No, not actual ticket sales but ticket distribution. Even during the economic downturn, ticket sales only saw modest decreases (5-10% depending on the sport) and now, premium seats are reaching record price levels. Most successful teams should not be and are not worried with selling tickets. Teams should start to care about the ticket resale industry and do whatever is necessary to screw Ticketmaster and make sure their is a fair, market based economy for sporting event tickets. 

Here is an example of why Ticketmaster has manipulated the ticket industry.

Imagine you buy a $100 ticket to a basketball game. The expected price of this ticket is $100 but as everyone knows, this is not the case. Instead, Ticketmaster charges a 10% fee on top of the ticket, raising the price to $110. At first, the extra fee does not seem too bad but in the aggregate, these fees start to add up. Causing customers to pay more on fees lowers the average consumer expenditure at games themselves. Instead of using that ten dollars to buy concessions, that fee is being leaked out of the circular flow between the consumer and the team for Ticketmaster's gain. Now multiply this effect by 410,000 tickets (10,000 tickets for 41 games). Eventually, over four million dollars is lost by both the consumer and the team.

If sports franchises worked with many of the fledging startups such as Sports Nook , Score Big,  and Fan Snap and put pressure on Ticketmaster and Stubhub, the industry could see sweeping reform. There are some instances where a market economy may be better but the sports ticket industry is not one of them. To ensure consumers get the best prices and best seats, there needs to be as many players in the market as possible. If the alarming trend of ticket fees continues, consumers will begin to feel alienated by their teams, decrease spending and be less engaged with team sponsors. It truly affects everyone.