Group-Sales Slump Pushes Teams Toward Unified Ticketing Strategy

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NBA teams experienced a 34.9% decline in group ticket sales and a 12.4% slide in full-season ticket sales during the 2021-2022 regular season (versus the ’18-‘19 season, the last full season unaffected by the pandemic). As a result, the league’s 30 clubs collectively had more single-game ticketing inventory to sell than at any time in recent history.

Organizations that maintained a siloed approach to sales struggled (in part because they were understaffed coming out of the sports hiatus). But Eventellect CCO Kate Howard said those that pivoted to a “unified strategy” experienced revenue and sell-through growth. Ticketing revenue across the league was up around 10%, while the number of tickets sold declined about 7%. “Taking a unified approach to ticket sales allows teams to better harness all existing demand, aligns objectives across internal sales teams and their strategic single-game partner, and enables them step into the future of ticketing,” Howard said.

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JWS’ Take: Industry insiders attribute the decline in group sales to the pandemic. They are likely to return, at least in some capacity, as teams shift their attention to community-oriented sources of business (like Little League organizations). But it is hard to envision group sales generating pre-COVID revenues again. “Corporate groups have always been a big driver of group-sales business for teams,” said consultant Michael Dillon (former VP of strategy and analytics, Houston Astros). “And while offices have reopened, many have done so with flex schedules. To a significant degree, remote work is here to stay. That will put continued pressure on the group business, with big corporate group events less likely to occur.”

Full-season ticket sales are also unlikely to rebound to pre-pandemic levels. “People aren’t buying in that way anymore,” Howard said. “They are buying more mini-plans and being more deliberate with how they spend their discretionary income and consume live events.” NBA partial-season plan ticket sales rose 25.8% this year.

Not everyone is convinced the demand for full season tickets has actually waned. The head of one NBA franchise said he believes the number of people who really want to be season ticket holders remains roughly the same as it was pre-pandemic. “What [has changed] is teams are moving more towards a [unified], direct-to-consumer model,” which naturally results in more single-game sales.

Sports organizations will certainly continue to try growing their season-ticket bases, but considering “it is pretty well clear that single-game tickets [will take] on a new importance for the foreseeable future,” Howard suggests they also look to refine their approach to single-game sales. Aggregate NBA single-game sales climbed 31.8% in ’21-’22 (single game ticketing revenue increased by more than 50%).

Clubs trying to remain ahead of the single-game sales trends have shed their siloed approach (think: season, group, suites and single-game sold by different teams within the organization) and are instead adopting a unified sales strategy in which all the ticketing approaches are informed by one another. “Crucially, it ensures that strategies in group and single-games sales are aligned with and support season-ticket sales, which still represent the largest source of ticket revenue,” Dillon said. “But just as importantly, a unified approach also breaks down the barrier between the primary and secondary markets.”

If the consumer no longer distinguishes between the primary and secondary markets when buying seats, there is no reason for teams to manage and price inventory as if the buyers on those platforms are different.

The pandemic-driven increase in single-game inventory undoubtedly accelerated the shift toward “unified ticketing.” But the strategy has been ”percolating” for the last several years as clubs increasingly think about how to simultaneously protect season-ticket holder value and provide single-game buyers with a fair and positive ticketing experience. “If you’re not strategically matching supply to market demand, and taking control of your single-game assets, you’re basically outsourcing your brand to hundreds of brokers to resell your tickets on various channels, and you’re not going to be able to influence the market in the appropriate way,” Howard said.

Regaining control of the single-game market also enables teams to maximize attendance and “participate [financially] in the entire cycle,” Howard added. Remember, sports organizations retain more of the fee revenue generated on secondary sales transactions when they occur on the team site. Eventellect does not publicly disclose its partners or deal terms, but the company confirmed a handful of MLB and NBA teams with unified models broke club records for single-game ticket sales revenue during the most recent season.

Clubs with commingled team sites (think: includes primary and secondary ticket inventory) will experience the greatest lift in revenues from the strategy change. “If fans go to the team site first and see tickets priced as good or better as they find on other marketplaces,” Howard said, “they are likely to just go back to that channel again the next time. [Eventellect has] seen double-digit increases in market share of team sites when they’re using a unified model.”

Several weeks back, JWS explained how more teams are dynamically pricing primary market single-game inventory. Howard believes it is important for sports organizations to account for real-time demand changes in ticket pricing. But she says single-game sales should be part of a broader ticketing strategy. “It’s not necessarily about [following the secondary market]. It’s about being able to look at the [TAM] and using the influence you have to get it to perform in an efficient way on the whole.”

Many of the clubs looking to adopt a unified, informed approach to ticketing have signed strategic partnerships that can help with the additional operational and data-science responsibilities. Companies like Eventellect, which has 68 pro teams as clients across the big five leagues, work to ensure the team’s tickets are priced properly (that means in accordance with promotions and marketing too) and distributed across various channels and platforms. Remember, sports organizations are not necessarily set up to manage those things themselves given constraints in the primary ticketing systems and on staffing.

NBA Playoff teams that adopted the unified approach prior to this season have benefited. “The teams we work with were able to post higher revenue than they had ever had because they were selling [so many] single-game tickets,” Howard said. “If you have single-game playoff ticket [inventory to sell], you’re able to price it to market as opposed to those [tickets] sold as part of a season-ticket plan at a finite price, which are not as efficient from a revenue perspective.”

It is certainly not too late for a team to pivot to the consolidated ticketing model. But they shouldn’t expect to have the same number of single-game seats to sell next season. Eventellect co-founder Patrick Ryan anticipates “somewhat of a correction” in single-game inventory, as teams see an improvement in group sales. The uncertainty that permeated last offseason also likely had an impact ’21-‘22 season ticket sales trends.

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