Behavioral economics speaks to how our inherent human instincts affect economic decisions. They play a large part in how people evaluate purchase decisions involving sports.

Behavioral economics explores how our hard-wired human cognitive biases influence our decisions, often leading to outcomes that differ from rationality and logic. Understanding key principles of behavioral economics can help teams understand fans’ purchase behavior when it comes to sports.

When people don’t know the value of things, they tend to assign a value based on the first reference they get. Studies have shown people change their estimate of an object’s value by simply hearing a different random number beforehand. For sports tickets, that anchor is face value. Teams should be aware that dynamic pricing will create a negative impression if it exceeds the face value. That negative reaction can be minimized if buyers are given a reason for the pricing difference, in effect “re-anchoring” their expectations. On the flipside, a bundle can create a positive effect when the savings from face value are clear.

We tend to value things more if they seem rare. It plays into our FOMO. That’s why keeping gameday promotions to limited editions enhances the perceived value, whether it be a t-shirt, a bobblehead, or a key chain. By the same token, repeating a promotional offer signals that the item is plentiful and therefore of less value. Limited purchase windows have the same effect for both tickets and merchandise.

Principle: Reciprocity

We are social animals, and we can’t help but feel connected and obligated to someone who has done us a solid. If you want a season-ticket holder to renew or upgrade,  consider giving something that signals special treatment: a used hand towel, a piece of old court, or a game puck. If it’s given as a gift, without framing it as a reward for another transaction, it can foster a sense of reciprocity. 

We tend to look to others for validation to justify our behavior for good and bad. Let your best fans be a model for your other fans. Showcasing hockey fans wearing their team sweaters at the game reinforces that team gear is the apparel of choice for true fans. Reinforce the behaviors you’d like your fans to follow by showing them how others are doing it. One of the most common ways you see teams utilize this tactic in-stadium is through Jumbotron cameras highlighting fans that are going wild and cheering.

In general, people hate losing more than they love winning. People will pay more to insure against losing $100 than they are willing to pay at a chance of winning $100. In that context, “have a great time with the family” may be less effective in getting people to a game than “don’t miss out on a lifetime memory.” This principle explains why the NFL's "Last Chance to Secure Playoff Tickets" campaigns drive more urgency than generic promotions, or why the Golden State Warriors saw a 22% spike in single-game sales when they framed a regular-season matchup as "Your Final Opportunity to See the Historic Curry-Thompson Duo." Teams also leverage loss aversion in merchandise, with limited-edition "retirement tour" jerseys (like Derek Jeter's 2014 farewell) consistently outselling standard versions by creating artificial scarcity.

We tend to remember an experience based on how we feel at its latest emotional peak. That’s why a walk-off win seals such a special place in our memory regardless of what came before it. But most game operations put all their emphasis on the beginning of the game (national anthems, dramatic team intros, player tributes, etc.) But there’s usually not much happening around the game after halftime or intermission. Putting some attention on late-game or post-game rituals can help seal a more positive fan experience. European soccer clubs like Liverpool FC have perfected post-match rituals, keeping fans engaged with player walk-arounds and communal singing of "You'll Never Walk Alone" long after the final whistle. These deliberate late-game experiences help cement positive memories that keep fans coming back.

When faced with too many choices, we tend to default to the simplest option. In some cases, the simplest thing is to avoid a decision altogether. While it’s tempting to construct a lot of different sales packages to appeal to different fan types, too many deals can have the opposite of the intended effect, resulting in less sales instead of more. 

Behavioral economics is a fascinating subject. If you want to learn more about it, Thinking, Fast and Slow by Nobel-prize winner Daniel Kahneman is the definite intellectual guide, while Influence: The Psychology of Persuasion by Robert Cialdini is the highly-regarded practical overview.