the corporate ticKet marKetplace - ALSD

two trends tend to offset each other.The professional ranks have 141 teams; the college ranks includeabout 500 universities. Minor leagues also contribute heavilyto the $5 billion. For example: there are more total suites in minorleague baseball than there are in MLB because the number ofteams is so much higher. But minor league suites tend to cost onlyabout 33% (or even less than that) of suites at a MLB stadium.Premium seating consists of both club seats (including courtside)and suites, loge boxes, field boxes, and various “clubs” whichexist in the venue. Club seating, the most expensive seat in thehouse on a square footage basis, is about 60% of the total marketplace.Too many teams, realizing this, have built out too many clubseats in the past. This problem also is being rectified.Sponsored spaces and naming rights in premium spaces is notincluded here. Neither are Personal Seat Licenses and seasonticket bases which have existed for generations. Also not includedhere is the concert industry which varies greatly depending uponthe touring acts and the price points for those acts.The Big EventsThe concert marketplace is very much like the event marketplacefor sporting events. What the Super Bowl is to premium,the Rolling Stones are to concert venues. The cost of premiumseats, not included in this $10 billion fee, is enormous. A SuperBowl suite usually commands upwards of $300,000 for a decentbetween-the-20s location.For major events such as the Super Bowl or Final Four, corporationsoften are given the option to purchase suites at very highrates. Those who don’t take the option, give up their suites for theevents.Many teams, cognizant of what major events are in their buildingsyears in advance, make sure their leases with the corporationstake the major event into account in several ways: 1) they use theevent as a bonus for signing a long-term lease, and 2) they includethe event and justify a much higher cost for the lease than themarket would normally bear.The Next Few YearsNegotiating leverage will continue to be on the side of the corporateconsumer for the next few years it now appears. But teams aregetting smarter. They are beginning to custom build venues specificfor their marketplace, with just the right number of premiumseats that the market will bear. They are offering more and morevalue to corporations, especially in the way of unique amenities.And they are beginning, through sophisticated database techniques,to distinguish between the business-to-business customerand the more casual business-to-consumer customer.As a result, occupancy rates seem to be going back up for theteams. And if there is anything the teams do understand, it is theconcept of leverage. So corporations need to understand betterwhat is available to them and what is not. It’s a give and takeworld out there, and corporations need to know if they are thegiver or the taker these days. #How is your team adjusting to the changing Corporate Ticket Marketplace?Write to Bill at bill@alsd.com, and connect with him onLinkedIn at www.linkedin.com/pub/bill-dorsey/6/125/76a.The $10 Billion Industry:In North America, there areapproximately 30,000 suitesand 800,000 club seats in thefive major sports, plus colleges,minor leagues, racing venues,and portable hospitality.This equates to a $10 billionindustry.#SEATWinter2013 | www.alsd.com | S E A T | 53