Business of Hockey

The difficult task of pricing Rangers tickets

One of the hardest things to do working in sports is trying to figure out what the appropriate pricing should be for tickets. Those of us assigned this task are keenly aware of our different customer’s financial pictures. The challenge of course is to come up with figures that are low enough to meet our consumer’s needs, yet high enough to bring in the revenue our owner(s) demand.

For most organizations I have worked for, pricing out tickets is rarely weighted on team performance. Before we even begin talking about individual seating sections and ticket plans, there first has to be a larger conversation about costs and revenue projections.

Now I don’t know if this is how the Rangers (or MSG at large) go about their business, but I imagine it must be similar to the organizations I have worked for.

With that said, every September we present to our owner(s) what our overall projected revenue is for the following year. These revenue figures almost always have to be higher than the previous year because costs always go up.

In recent years, the cost of doing business in New York City has gotten pretty ridiculous. Healthcare premiums are through the roof, taxes are high, advertising costs are the highest in the country, and the cost of working with unions has gotten incredibly expensive.

The problem is none of this is communicated to customers because a) they generally don’t care and b) we can’t throw our partners under the bus. It’s just bad business.

Anyway, so once our owner gives us a figure that we have to reach, we can then start planning out how we are going to hit that number. For tickets specifically, we have to look at what the price increases are for other local entertainment properties (i.e. baseball, football, Broadway, etc.), as well as what the rest of the league is doing in their respective markets.

In previous seasons, the Rangers average ticket price didn’t crack the top 5 teams in the league (according to TMR’s fan cost index). This was probably a mistake since the NY market is one of the most expensive markets to do business in and the demand for tickets has always been very strong.

In my opinion, the second mistake was the decision to keep ticket prices flat during the Rangers playoff drought. It put the organization behind the eight ball and they’ve been trying to make up for it with larger than normal increases ever since. Top it all off with the cost of doing the renovations without tax payer dollars and voila, you have some serious costs to cover.

Now I know the recent price increases in some sections are pretty ridiculous, there’s no arguing that, but these things aren’t just done on a whim. Hopefully this post helps explain more about the overall process and where your money actually goes.

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  • All your points are very solid business decisions!

    Now that we have a recession going, the unemployment rate over 8%, under employment rate close to 15%, it doesn’t bode well with the decision to raise the rates soo high at one shot. I believe that the little guy, the true fan is being hurt by the rate increases, and the only people who can afford the increases are the corporate customers. Warning to the Ranger management, with the economy being what it is, the corporate guys may re-think their decision to buy season tickets as well. Just my thoughts!

    • That’s fair and the people in charge are aware that these price hikes are unpopular. Unfortunately little will change until they start seeing empty seats.

  • a) I’d like to thank The Suit and Dave…I kinda/sorta requested this post

    b) I generally agree. The construction costs in NY is crazy, so I understand, I just hate the upper levels, the ‘true fans’ getting priced out…but I guess that’s the price of doing buisness.

    I wonder what/how the price increase would have went if they had moved the Garden to the Post Office (what I would have rathered)?

    • This is all Suit, I take no credit for this, but thanks.

      But to the “true fans”…what makes you think people in suits aren’t true fans?

      • This is most definitely a generalization, but when people are in suits around my seats (Section 114, had to move down as my mid 300’s behind the goal were removed, where the press seats are now) 1) I rarely ever see them again. 2) They don’t stand/yell even when goals are scored.

        Yet to see someone in a suit act enthusiastic around me…I know they are out there, but this is a generalization from what I’ve seen in my section.

        • I dont know, from what I’ve seen and been around the corporate folks are fans too, sometimes they are just a little better behaved, but that is because many of them are entertaining clients and employees. But as someone said, this all seems like a generalization and not the real source of people’s anger, which is the invoice they are getting in the mail.

          • Agreed, most people in the section are cheering anyway…but even if you’re wearing a suit and entertaining clients, c’mon, get up and sing the goal song (I’m sure you do, Suit)!

            To be fair, I have only seen suits in my section a few times, so it’s not a very fair sampling.

            However, it is sad though that in my section, the only familiar people game after game are me, my girl, and the two people who sit behind us. Everyone else seem to be StubHub/resale folk, nary a familiar face.

  • As a UK hockey fan I’m always surprised by the general price levels and cost of jerseys. Hockey prices seem considerably more expensive than professional football / soccer over here and we always regard that as expensive.

  • 3 things.

    1) They can set the price at whatever they want. There’s always going to be people that will pay whatever it is to go to the games. Unless they start a serious boycott of not going to the games or something people will continue to go.

    2) Sort of unrelated but I think people hate the fact there’s too many corporate people and not enough true blue Rangers fans. No offense to the suit wearing folks but they really destroy the atmosphere. Not to mention the color coordination when you look at entire sections. Not enough blue jerseys and too many suits in the crowd.

    3) Speaking of the corporates, I know Ontario is trying to make it so certain businesses can’t use tickets as a tax write off. I see this as a good and bad thing. If Ontario does this, I wouldn’t be shocked to see other places follow suit. I guess this is great for the die hard fans who want other die hards in the crowd, but terrible for the teams overall who really need that corporate money. I’m curious to see what happens with this.

    • 1) No they can’t. If they set it too high people won’t pay. They have to keep in touch with the consumer price limit. It’s Business 101…knowing your customer.

      2) I have to wear suits to games every now and then. Does that mean I’m not a real fan? Not everyone has the luxury of changing before the game.

      3) I don’t pretend to know the intricacies of corporate tax, but I doubt it would deter corporations. They use it as a selling tool. “Hey look at these seats, now let me sell you business.” Many companies in the service industry do this.

      • Obviously they can put the price so high that people simply won’t pay, but your not going to see people not show up to the games with the recent increase in pricing.

        Obviously wearing a suit doesn’t make you specifically not a true fan but there are too many “corporate people” at the games who are only there because their tickets are free. I sat in the Delta club this year because my dad opened an account with Chase and got free tickets. Face value they were $600 a seat. I sat behind the glass and I was one of the few wearing a jersey. It was a little embaressing. Hopefully for the playoffs the real fans pack the building. I’m not going to pummle anyone that wears a suit to the game but it doesn’t look good for television and the people who don’t stand or cheer sort of kill the atmosphere.

  • Post for anyone getting their prices raised…how did you find out? I haven’t seen anything from MSG, even in the playoff ticket package.

    I have a pair of half season seats in 114, close to the back. Luckily they are still green colored so I managed to save $20 per seat per game because the seats in front of me are more comfortable. I haven’t received any notice of price increases though. I’m hoping to get away with it after I am paying 40 bucks more per seat per game than I did last year after getting bounced down .

    • Disregard this post…I now realize half plan subscribers don’t have rights…kind of makes sense but is also kind of a bummer.

  • I am a subscriber for 40 years sitting upstairs. A 36% increase this year for the diehard real fans is ridiculous. We understand the game better, attend more frequently and start most of the Let’s Go Rangers chants. Yes, some suits are real fans. But the noise starts upstairs. And now my adult children who I raised as True Blue fans will not be able to attend as many games and I can only afford to take them so many times. So this is just one more sports franchise pushing lifelong fans out of the arena. I just hope MSG doesn’t become the ghost town that Citifield now is.

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