Posted by John Vrooman on Thursday, June 9, 2016 in National Basketball Association, Sports Econ Blog.

Interview with Inc. Magazine

Season Ticket Strategy

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I wanted to learn more about the differences  between the ticket pricing strategies of the Golden State Warriors and the Dallas Mavericks. The ticket prices for the Warriors seem to have increased significantly over the past few years as their popularity has increased. Mark Cuban’s strategy with the Mavs has been to increase the prices for the court seats and in some cases decrease the prices for the less expensive seats or the seasonal ticket holders.

-Is there an advantage to the Mavs’ strategy over that of the Warriors? Or is it just a question of whether or not the teams’ owners want to maximize profits? 

-Is is uncommon for a sports team to pursue the Mav’s strategy (so as not to price out some fans)? 

-Do the Warrior overall price increases change the fanbase composition? 

-And lastly, is the Mav strategy better or more stable in terms of long term profits? 

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Here is a more detailed analysis to answer your previous questions. I have attached graphics showing a comparison of the two ticket pricing strategies you brought up for the Mavs and the Warriors (Dubs).

I have used the more inclusive fan cost index which includes the ticket prices and concessions. FCI is estimated by Team Marketing Report (TMR) and is widely used in the industry and sports media.

Most of the graphics are self-explanatory and I have included the original excel versions in case your graphics guy wants to adapt them. I have normalized both winning percent and FCI by comparing them to the league averages (which for winning is always .500). This way they are inflation adjusted and can be compared in the same graph where the league average is always =1. The evidence strongly supports both your intuition and my ticket pricing theory.

The good news about winning and the bad news about paying the price are usually the same with the Wub’s opportunistic pricing strategy. If current Warrior fans are feeling the gouge during this recent round of unprecedented success in Oracle Arena, just wait until they get the full bill for the new and opulent Chase Center across the Bay.