“Dynamic pricing is based on consumer demand and generally affords fans who buy early to save more,” Duane McLean, executive vice president of business operations for the Tigers, said. “With dynamic pricing you could see the value of ticket prices increase and decrease based on demand."
Thursday, February 27, 2014
How to Fill a Ballpark
Filling a ballpark is a classic example of a yield management problem. Demand for any game is uncertain but supply of seats is fixed. The team would prefer to set prices based on the expected demand for that game. Even better, let fans indicate the level of expected demand by their willingness to purchase early. Following this logic, more baseball teams are moving to dynamic pricing where the price of a seat changes over time as more or fewer are sold. As the Detroit Free Press reports: