The 2017 Super Bowl season officially kicked off this week. For the next two weeks, it will be a mad scramble of marketing, publicity, parties, and, of course, tickets. It will drive billions in national GDP, and it will all culminate in sixty minutes of football.
Over 100 million people will watch the game on TV, and for those who want to see it in person, the current average listing price for Super Bowl 51 is $5,889. That makes it the most expensive average price we’ve ever tracked for the SuperBowl on the Monday following Championship Sunday.
At that price, the 71,795 seats this year in NRG Stadium have a market value of over $400 million. Regardless of how prices rise or fall over the next week, it’s the biggest market for a single event that exists on the planet. It’s also the most visible event in for the ticket industry, which makes fixing it all the more important.
By kickoff, between 10,000 to 20,000 tickets will have been sold online or in apps through sites like TicketIQ, StubHub and Seatgeek and NFL Ticket Exchange. With 71,795 total seats at NRG Stadium, many of the remaining 50,000 seats will be the domain of a paper, cash and envelope-based supply chain that is virtually unchanged in 30 years. In 2016, it seems unimaginable that a commodity marketplace as big as this one could operate with such opacity.
A better-lit future may, however, be on the horizon for two big reasons.
The first is the NFL’s long-term view of value across all facets of their operations, including tickets. The second is the arrival for this Super Bowl of NFL-owned On Location Experiences.
One day into the 2017 market, it appears they’re already having an impact, as reported last night by ESPN. As of this morning, TicketIQ is tracking 1,500 tickets available across all the sites we aggregate, from sources like SeatSmart and the NFL Ticket Exchange.
The previous low for quantity available on the Monday after championship Sunday was 3,025 for the 2012 game between the Giants and Patriots. The number has been as high 6,500, for the Seahawks and Broncos game is 2015. While the entire impact of what an NFL and OLE-managed Super Bowl means for consumers may not be clear for a few years, the early indication is that we should expect a smaller ‘open’ marketplace for tickets.
While many will complain that On Location and the NFL’s tighter supply management will drive up prices up prices (which it will), they’re missing the bigger picture value it brings in the form of much-needed marketplace basics, like the ability to buy a specific seat, which OLE and Ticketmaster have partnered this year to launch…for the first time ever.
Much of the mayhem of SuperBowl markets past have been the result of something called speculative selling, by which brokers list tickets for sale on major marketplaces without actually knowing what seat they are selling. These ‘zone-based listings’ have uncertain names like “Upper Level EndZone, N/A” and “300s Level Corner, TBD.”
This year, many of the tickets that get sold in ‘open’ marketplace sites or apps will be zone-based listings.
To avoid the kind of market blow-up that I covered in 2015, speculative selling needs to be eliminated entirely.
That will create a picture far better than the complete chaos that we saw in 2015 when thousands of fans purchased tickets 10 days ahead of the event only to arrive in Arizona to find that their ticket had vanished into the desert air and that the cost to replace their $2,500 ticket was $10,000.
A functioning ticket market means ultra-high demand events will have ultra-high prices. From my perspective, that is the basis of supply and demand, and the foundation of every commodities market. As an alternative to fraud, lawsuits, and heartbreak, it’s a no-brainer.
In 100 years when economists look back at the ticket market of the last 25 years, it will be a fascinating case study on the power of technology to break the fundamental laws of economics, and efforts of various actors—good, bad and ugly—to rewrite the laws that had been broken.
The good news for fans and teams is that the best minds at companies like Ticketmaster, SeatGeek and Eventbrite are focused on technology to unlock primary market supply in the same way that TicketNetwork and Stubhub did for brokers 25 years ago around the advent of Internet.
As a measure of progress, according to Ticketmaster, the number of developers accessing the API they launched almost two years ago has increased from 200 developers at launch, to over 2,000 today, of which TicketIQ is one. Seatgeek is months away from launching their first client, Sporting Kansas City, on their new primary ticketing platform, called Open.
For consumers, all this access will mean a category experience that improves significantly. For some events, like the Super Bowl, it will mean higher prices. For many other events and categories, however, it will mean the opposite.
Broadway is a case in point. Today, almost every major retail ticket marketplace lists a version of speculative tickets for Broadway shows that are not sold out. These tickets are often 50% more expensive than the highest price ticket available from the box office. It’s a business practice that can survive only amidst a consumer information void, and the day that unsold box office tickets become available across major marketplaces, it dies.
The speculative selling that happens for the Super Bowl may take a bit longer to clear out, as it’s rooted in more complex marketplace dynamics. The bottom line is that for an event that defines the 1%, a 25% increase ticket prices isn’t going to make a lick of difference.
It will make very little difference in who does and does not attend the game, and it will make no difference in how people perceive the ticket category overall.
For all the reasons listed above, rightsholder-driven marketplaces are the only way to move tickets permanently out of the street-corner shade that so many consumers still associate with buying a ticket.
To get it right, it will require a long-term perspective, which is something that rightsholders like the NFL and OLE have more than any other potential option. It’s also an opportunity for the same risk-taking rightsholders to expand their definition of consumer value for everyday fans.
Such value reframing will provide an opportunity for access and experiences that the secondary-market, with it’s short-term horizon, simply can’t deliver. It will also allow teams to effectively compete in a digital marketplace. As a ticket buyer and fan, it also gives me something to look forward to, especially for the 99.99% of events that are not the Super Bowl. For that game, my couch works just fine.Featured Image: Bryan Allen/Getty Images