The efforts to maximize ticket revenue have gone through several stages and are poised for the next one.

The art and science of ticket sales keeps advancing. Understanding how it’s evolved and where it’s headed may help advance your ticketing strategy.

Past

There are records of tickets for events dating as far back as ancient Rome, but the first sporting event in the US to charge admission was a horse race held at the Union Course in Long Island, NY, on May 27, 1823. But before ticketing could become widespread in US sporting culture, one thing had to come first: the stadiums themselves. The construction of stadiums was key to the rise of ticket sales as they allowed more people to attend and watch the games while blocking those without a ticket from a clear view of the action.

In the early part of the 20th century, the main innovation in maximizing ticket revenue was simply size. Aided by advances in steel and cement, larger stadiums that fit more people were built across the country. In 1926, Soldier Field in Chicago became the first stadium to hold over 100,000 people for the Army/Navy football game.

While there were limited box seats in some early ballparks, they weren’t a substantial part of either the architecture or revenue of teams at the time. Premium seating increased slowly until it took a leap forward with the new Dodger Stadium in 1962. It offered premium seating behind home plate and in the main seating bowl, with club-level seating, waitress service, and an enclosed environment. The Houston Astrodome built on that by introducing the first luxury suites in 1965, though they lacked a view of the field.

Present

Premiumization escalated as a major feature of both stadium design and revenue maximization from the 1980s to the present. Premium seating started as a status symbol to draw attention to teams and their stadiums. But it transformed into a way to harness corporate and high-net-worth fan dollars to drive increasingly higher revenue per square foot. The standard stadium today has multiple variations of luxury suites, club seating, VIP lounges, and restaurants. These options created multiple higher pricing tiers for teams. By adjusting pricing between seating options and attaching different benefits to different seats, teams have more ways to raise or lower prices to fit demand.

More recently, teams followed the aviation industry by implementing dynamic pricing. Teams long had variable pricing, where different prices were set depending on static factors like day of the week. With dynamic pricing, teams automatically adjust prices based on real-time factors like how far in advance the ticket is being purchased, the quality of the visiting team, or the weather. Ticket resellers aggressively instituted dynamic pricing, and teams followed suit. New companies like Qcue, Tillion, and Victory Live provide teams with AI-enabled software to manage ticket prices. Many teams lagged in implementing dynamic pricing because their ticketing partner was Ticketmaster, which was initially slow to adopt the technology. Now, most Big Four pro teams have some form of it, and colleges are increasingly adopting it as well. There is some lingering resistance to full-scale implementation for fear of creating an impression of price gouging, not unlike the reactions to Uber surge pricing. But when implemented to maximize attendance, it can result in cheaper tickets for fans as well.

We previously wrote about the rise of the premium seat; check it out here.

Future

The next step in ticket pricing is personalization. If dynamic pricing is built around the real-time information around the game, personalization goes further by leveraging real-time information about the ticket buyer. For example, you might offer a different price to buyers coming in for a game from out of town based on the assumption that this is a special event for them. A team could offer upgraded seats for an incremental charge in combination with an offer on team merchandise. The Cleveland Cavaliers' loyalty program, as outlined in an SBJ article, is a step in that direction. Cav’s fans can opt into a program that not only tracks their in-stadium spending, but also their spending on Cav-related or sponsor products outside the stadium. That gives the Cavs more data on their loyalty members from which to craft unique personalized offers.

Application

There are three things you can do to understand where you should take your ticket strategy

1. Understand your opportunity - You shouldn't worry about building a personalization engine if you’re working to fill a lot of empty seats. Understand if your biggest opportunity is selling more seats or getting more revenue from the seats you already fill.

2. Audit Your Ticketing Tech Stack - The sophistication of your programs is enabled by the sophistication of your systems. While there can be many pieces, the core ingredients are the ticketing system you use to manage inventory and sales, the CRM system you use to track fans, and the ability for those systems to communicate. You may not be taking advantage of all the features available to you, or you may have systems that are holding you back.

3. Test and Measure - As with all successful innovation, the key is to set objectives, measure, and learn. The LA Clippers experimented with a season ticket variation they dubbed The Wall, which Sportico says has been very successful. It was designed and tweaked in an effort to find ways to tap into the loyalty of die-hard fans who don’t have the means to afford premium season tickets.