Rutgers University Tackles Demand For Football Tickets With Dynamic Pricing

September 5, 2014

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By: Jesse Lawrence, Forbes

How Rutgers University fares against the challenges offered by Big Ten Conference football opponents is yet to be determined, but the school has already passed one major test off the field.

Demand for Rutgers football tickets has never been higher, with Rutgers supporters clamoring for tickets to home games during the inaugural Big Ten season.

How is Rutgers ensuring that its fans are the ones receiving home tickets and not ticket resellers looking to capitalize on the increase in demand?

The answer is simple: dynamic pricing, a long-standing strategy that has been embraced by many, most notably the airline industry, but has only picked up momentum in the sports industry in the past five years.

Rutgers has implemented dynamic pricing for football tickets to all four Big Ten home games this season. The first of those will be September 13th when Penn State visits High Point Solutions Stadium in Rutgers’ first Big Ten Conference game.

Though dynamic pricing is not new to sports in general, having been instituted in Major League Baseball for a few years now and slowly gaining traction in the NHL and NBA, few universities have opted to change their ticket pricing structure.

Rutgers took advantage of the school’s entry into the Big Ten to revamp how its football tickets are priced.

Dynamic pricing offers the school the flexibility of adjusting the price of tickets in real-time, ensuring the secondary market does not solely dictate the value of the school’s tickets. This allows the school to maximize revenue from each of its Big Ten home games while also dissuading ticket resellers from purchasing single-game tickets.

One of the primary reasons for implementing a dynamic pricing structure was to protect the true Rutgers football fan. With a significant variance in demand between home games this season, static ticket pricing would have enabled ticket brokers to purchase as many tickets as possible for the Penn State, Michigan and Wisconsin games and then essentially set the value for those tickets on the secondary market.

Tickets would be bought at face value and would subsequently surface on the secondary market for two to three times that price only seconds later.

Rutgers fans looking to buy tickets for just one game will see similar prices on both the primary and secondary market. For fans looking to go to several games over the season, the ability to purchase season tickets at a particular set price becomes all the more valuable.

“Dynamic pricing increases the value of being a season ticket holder,” said Geoff Brown, Senior Associate Athletic Director and Chief Marketing Officer. “This is one of the many reasons that demand for our season tickets is at an all-time high. We have been telling our fans for months that it makes much more sense to buy a $265 season ticket than to pay $150 or more for a single game.”

The price certainty of season tickets has already proven to be an attractive option as Rutgers set a school record by selling nearly 31,000 season tickets.

Last week, Rutgers announced that the Penn State game was sold out, leaving the secondary market as the only option for tickets.

The get-in price for Rutgers vs. Penn State tickets is currently $125 and with the quantity available decreasing daily, there is no guarantee the price will drop significantly. Thus, fans waiting out the market will ultimately pay considerably more than the season ticket holder who spent $265 a few months ago – while having the added bonus of being guaranteed the same seats for every home game.

Reece Fischer, Manager of Revenue Strategy and Ticketing Analytics, said there are several different factors that influence how his office dynamically prices tickets, with the goal being to offer ticket prices that beat the secondary market.

“We see the prices that fans are paying on the secondary market,” said Fischer. “Dynamic pricing allows us to adjust our prices to match the current market conditions on a daily basis. The biggest factors that we consider are secondary market prices, remaining ticket inventory, and quality of opponent.”

Though dynamic pricing is much more reflective of the true value of a ticket, it does not mean that this strategy comes without any drawbacks.

Since Rutgers is only dynamically pricing for Big Ten games, the school is not altering its prices for Saturday’s home opener against Howard and the September 27th game against Tulane.

Ticket brokers who purchased season tickets often attempt to make money off the big games while simply dumping tickets for lower-demand opponents. That’s why tickets are available on the secondary market for the Howard game at less than face value.

Yet, it’s still substantially more expensive to buy tickets off the secondary market to the marquee games compared to buying season tickets for all six home games this year. If that remains the case, Brown and Fischer know it really doesn’t matter how much it costs for games such as Howard.

While it may be a daunting task for Rutgers to be immediately competitive in the Big Ten on the football field, it appears the school’s ticket office is ahead of the curve compared to many of its conference counterparts.

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