Creating a Demand-Based Ticket Model for Eliteserien: How revenue management could save the Norwegian league's attendance rates

Abstract

Dynamic pricing has been a pricing strategy used by many industries with shifting demands. However, sports have just recently started implementing such a strategy. From pricing experiments in the American baseball league MLB to mathematical models created for European sports teams. The currently available studies have focused exclusively on making models for big teams in major sports leagues, but not on a smaller scale with fewer supporters. Furthermore, previous papers have had their main point of attention on revenues, while this paper looks at how to increase attendance rates using dynamic pricing. This research paper will look at implementing such a strategy in the Norwegian top division for football called Eliteserien. The necessary information on the club’s pricing strategies was realized by a survey answered by the majority of the league’s ticket coordinators. Further, using previous prices and attendance rates combined with price experiments, we are able to find the consumers’ price elasticity. Results indicate that consumers are far more price elastic now than they were in previous years. Based on this elasticity, we can make a dynamic model that charges different prices based on the point of purchase and demand. With an analytical model, clubs will be able to increase attendance rates by addressing customers’ demands at several levels.