Thursday, October 19, 2006

The Vig, The Juice alive and well at the World Series thanks to the Detroit Tigers

The World Series opens Saturday night at Detroit’s Comerica Park, the hottest ticket in the Motor City in years, a bigger ticket for Detroit sports fan than tickets to Super Bowl XL held at Detroit’s Ford Field in February.

The Super Bowl remains the most value and expensive ticket in sports. Detroit did host Super Bowl XL, but that game featured the Pittsburgh Steelers and the Seattle Seahawks. The Super Bowl has evolved from a sports event to the biggest corporate event in America. Attending the Super Bowl is no longer an event sports fans event, the World Series still is. For long suffering Tigers fans tickets to the World Series are the most valuable ticket to a Detroit event in years.

The Tigers like most sports franchises offer their season ticket holders (as they have throughout the entire 2006 season) an opportunity to resell tickets at what the Tigers call their “Tigers Ticket Exchange”.

The secondary ticket market has exploded in the last six months; it’s a market that is out of control. The secondary ticket market seems to have melded current technology, ticketing and created a new revenue stream for sports franchises. The problem with new revenue sources for sports teams, they tend to jump in with both feet and rarely if every look before they leap. Similar to a runaway train, the secondary ticket market has the potential to bring damage and harm to the reputations of sports franchises enticed by the chance to bite from the poison fruit. The American League champions Detroit Tigers have bitten into that tasty treat and are about to get stung.

How does the Tigers Ticket Exchange work, according to the teams’ website as simple as this -- Season ticket holders, now you can use the Tigers Ticket Exchange to resell your 2006 postseason tickets for games at Comerica Park!

If you can't use all of your postseason tickets, you can make them available to other Tigers fans with this efficient and easy-to-use service. As a full season ticket holder, you post your available unused tickets and name the price you want for each ticket.

Buyers can view and select the tickets that meet their game, price and seat location needs. The Tigers Ticket Office conducts the transaction from season ticket holder to purchaser to ensure a safe and secure exchange.

All payments are made directly to the Tigers. Tickets are e-mailed to the buyer and they are able to print their tickets at home. If a potential postseason game is not played, the Tigers Ticket Office will refund the purchase to the new ticket buyer. It's that easy!

However, while it may be easy, the Tigers Ticket Exchange operates under the principal of the free market system. The system allows Tigers season ticket holders to sell tickets at whatever price they determine. Wednesday night, there were 169 different ticket offers. Tickets with a face value of $250 per ticket, a ticket price established by Major League Baseball, were offered at a cost of $8250 per ticket. The least expensive tickets with a face value of $75 where being offered at a cost of $572 per ticket.

The concept of offering your season ticket holders an opportunity to resell their tickets for games they cannot attend is a great example of customer service. Trying to attend 81 baseball games is a near impossibility. A season ends and a drawer full of unused tickets sends the worse possible message to season ticket holders. At the very least season ticket holders pause and wonder if it makes sense to own season tickets if the tickets can’t even be given away to certain games. A ticketing reselling program helps to ease that challenge.

The Cleveland Indians created a ticket page on the teams’ website to assist Indians season ticket holders in reselling tickets they’d like to sell for any game. It’s very similar to the Tigers website, with one very important difference; you cannot sell tickets above the face value of the tickets. The Indians’ created their secondary ticketing opportunity after Jacobs Field major league 455 game sellout streak ended. Since the Indians sellout streak ended early in the 2001 season, the Indians have sold out a handful of games. By offering their season ticket holders the opportunity to resell their tickets at face value, in essence the Indians are competing against themselves. Indians tickets are readily available but the Indians belief is that it makes more sense to offer great service to their season ticket holders, as long as they sell the tickets at face value.

The Boston Red Sox arguably the hottest ticket in baseball with nearly four consecutive seasons of sellouts at Fenway Park offer their season ticket holders the opportunity to resale their tickets at “Red Sox Replay”. Buyers have to pay a nominal fee ($50 for a one year account). Tickets are sold at face value. The season ticket holder account holder receives a credit on their account and the buyer can either pick up their tickets at Fenway or print them at home. The membership surcharge may seem expensive if you’re just interested in one or two games, but for those New Englanders who it seems can never find Red Sox tickets the Red Sox have created the right opportunity for those with and without tickets.

The Tigers make it very clear, the rules are very different at the home of the 2006 American League champions -- Season Ticket Holders may charge a price above face value for their tickets. All Tigers Ticket Exchange sales are final — no returns, refunds, or exchanges.

The obscenity only begins with the Tigers creation of a Ticket Exchange board. Selling tickets above face value is illegal both in the City of Detroit and in the State of Michigan. However the Tigers are working within the bounds of the law because the law doesn’t apply to tickets sold by Tigers. World Series tickets are being sold well above face value through eBay, StubHub, Razorgator and all of the usual suspects. However, none of those would be considered legal in Detroit or in Michigan. And the Tigers, and here’s the real kicker – collect 10 percent, the Vig, the Juice, their cut of the pie.

If you where interested in buying these four tickets being offered Wednesday night at 8:15, in section 130, Row 9 Seat 6-9, all you had to do was login to the Tigers secured ticket server (Ticketmaster), debit your credit card $33,001.75 and you’d have four great seats to Saturday nights game. The tickets would be sent to your email inbox, using Ticketmaster’s TicketFast technology. If you wanted actual tickets (a nice souvenir for your $33,000 expense) sorry all you’re going to have is an email printout from your computer. The Tigers pocket $3,300 by doing nothing more than offering the opportunity to their season ticket holders. The Tigers season ticket account holder has in effect sold his four tickets that he paid $1,000 for, for $29,701.

Before Tigers won the American League championship, anyone who was prepared to purchase 2007 season tickets had access to 2006 World Series tickets. If you believed the Tigers’ destiny included the 2006 World Series (remember this was once the Tigers had qualified for the playoffs) in reality you could have resold your World Series tickets, covered the cost of your 2006 World Series and 2007 Tigers season tickets, and resell your 2007 Tigers regular season tickets at Tigers Ticket Exchange. The Tigers continue to collect their ‘juice’ 10 percent – when each and every ticket is sold.

The Tigers Ticket Exchange is one perverse example of how the Tigers are leveraging their first World Series appearance in 23 years. While not being advertised on the Detroit Red Wings website, both organizations owned by Mike Illitch are offering anyone who’s prepared to buy 20 single tickets to Red Wings games played at the Joe Louis Arena during the 2006-07 National Hockey League season, the opportunity to purchase two side-by-side Tigers tickets, located in the outfield box, for $256 per seats for either game one or game two of the World Series. Joe Louis Arena seats 20,066. Motown likes to call itself “Hockey Town,” and the Red Wings sellout most of their home games. With the opportunity to sell hundreds of single tickets, the Red Wings find it next to impossible to sell on a consistent basis, however by offering World Series tickets is a sound business move, yet is it the right decision in terms of the Red Wings and Tigers image. Is it a clear attempt to take advantage of an opportunity presented to two businesses owned by Mike Illitch.

The Montreal Canadiens have won more Stanley Cups than any other team in NHL history. For many years the price the Canadiens charged their season ticket holders for playoff games never changed, regardless if the Canadiens where facing a team in the first round of the playoffs or in the seventh game of the Stanley Cup finals. The Canadiens when they where owned by the Molson family understood ownership of the Canadiens was a sacred right, and with that ‘right’ came certain responsibilities. Clearly if the Molson family owned the Detroit Tigers and the Detroit Red Wings, the organization(s) would not be forcing sports fans to buy leftovers to taste the entrée.

Making a trip to the World Series is a rare experience for a Major League Baseball team. Properly positioned it can be a tremendous opportunity to build your season ticket base, create goodwill, and build your teams brand for many years. If an organization understands what they’re doing, and see the opportunity for what it is (a chance that comes once every so often) and doesn’t take advantage of their fan base, the organization can create goodwill for years, goodwill that can be used in tough times.

The Tigers may not be doing anything legally wrong, but morally and ethically the Tigers are setting an example that is embarrassing on every possible level to Major League Baseball. The optics of tickets being sold for $33,000 (that have a face value of $1,000), the Tigers collecting 10 percent of that sale, the Red Wings and Tigers dumping single tickets for Red Wings games in order to sell World Series tickets demonstrate what the values of the Tigers, the Red Wings and the business acumen or lack thereof of Mike Illitch.

For Sports Business News this is Howard Bloom

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