Tinkler will slash the price of family tickets

[perverse]

good post, Cheesie. Tinkler must operate under the laws of the universe, much like the rest of us.

 

[East Coast Tiger]

Has anyone even considered that maybe he doesn't even give a sh*t if lower prices mean the club doesn't bring as much in?

The bloke is forking out $10m a year, at least, out of his own pocket because he wants to see the club get back to where it used to be. That includes having big crowds for home games. Maybe he cares more about seeing his club well supported and popular. Just look at how much milage AFL gets out of its big crowd figures. They claim to be more popular even though their TV ratings don't stack up but people believe them because they see full houses. This is not to be underestimated. I don't care if the Knights reducve prices by 50% and only see a 30% increase in crowds. I still reckon the long term benefits will outweight any direct loss in gate takings. And if the club's owner feels the same way then it doesn't really matter what anyone else thinks.

 

[saint pebba]

I think we should hold off drastically changing the price of tickets until we see the benefits of our push for memberships.

Our prices aren't that bad, except the Titans.

I have been to see games at nearly every stadium and can categorically say the prices at Skilled Park at ridiculous. A ticket that would normally cost approx $30 at every ground cost $45 on the Gold Coast.

 

[Cheesie-the-Pirate]

Has anyone even considered that maybe he doesn't even give a sh*t if lower prices mean the club doesn't bring as much in?

Of course this is the case. My comments above weren't really directed at Tinkler, more the general consensus in this thread that increasing crowds by reducing ticket prices is an axiomatically sensible move.

 

[East Coast Tiger]

Of course this is the case. My comments above weren't really directed at Tinkler, more the general consensus in this thread that increasing crowds by reducing ticket prices is an axiomatically sensible move.

It's only a sensible move if you want to encourage people people to support your team. If not then charge away.

 

[Ronnie Dobbs]

Hmmmm

A few thoughts.

1. I find it hard to believe that ticket prices aren't already decided upon using some sort of detailed analysis of the microeconomics and finance of the situation. It's not by chance that different clubs have different pricing structures. They weren't pulled out of a hat.

2. Other than a select few clubs, all of the clubs have relatively inexpense family ticket options. Perhaps not quite in the $180 per season category, but still at a level that is demonstrably reasonable. Saints hill 12 game family membership is $340 per season or $28 per game for a family. That's a pretty cheap option compared to the alternatives. You can't take the family to the movies for that on Cheap Tuesdays.

3. Even if tickets were free, there still would be empty seats. The assumption that the price where supply = demand is greater than nil is a big one that is unlikely to stand up to scrutiny.

4. Drastic reductions in the price of your goods can do a lot of damage to your reputation. It also makes it harder to price discriminate for those customers that might want to spend more.

5. How strong is the correlation between ground attendance and merchandise sales. There's obviously some connection, but is it strong enough to make up for lost revenue in other parts.

6. I'm really not convinced that you'll make it up in beer and food sales :
a. If the value of a trip to the football for these people is so low that they require lower ticket prices, how much are they likely to spend on food priced at luxury levels?
b. Margins for food and beverage sales can't be as high as everyone assumes based upon the high sale price. Keep in mind the high costs as well.
c. I'd expect that when approaching full capacity of grounds marginal cost for supplying these items would be quite high (inventory costs, extra staffing, etc).

Very weel thought out post Cheesie. The only issue I have with you've put forward is that you've gone the a.b.c option after number 6. I'd have used either bullet points or roman numerals.

 

[aqua_duck]

I think people are missing the point abit. TSG has not said they'd slash all ticket prices in a fire sale, they've only said that they'll reduce the price for family season tickets. Family season tickets wouldn't only make up a small percentage of match day crowds, and the loss in revenue will in turn breed a new generation of fans. Where in the past it might only be mum and dad going to the football, it will now be mum, dad and 2 kids. Those 2 kids will now very likely become lifelong fans. It's short term pain for long term gain, but Tinkler is one bloke who can afford to absorb a small loss. I mean say he keeps it up for 3 seasons, what's the most he can lose? A few hundred K, that's pocket change for him when you consider he's reported going to spend $200k on his takeover campaign

 

[juro]

Excellent points, Cheesie. I'm not saying it is a no-brainer to reduce ticket prices. I'm just saying that when setting ticket prices, more needs to be considered than just what ticket revenue totals. I would hope that clubs do this at the moment but I don't know.

There are obviously extra costs incurred by having larger crowds (security, staffing, etc) but there are also obviously extra sources of revenue.

And the club would also need to consider what impact crowd sizes would have on future cashflows. For example, getting people into the habit of going to the footy on a regular basis would likely lead to higher crowds in the future, even if prices were later increased. Short term losses may lead to long term gains...

 

[East Coast Tiger]

"Long term? What's that?" I can hear Gallop and most club CEOs saying. To them long term is next season.

 

[babyg]

Has anyone even considered that maybe he doesn't even give a sh*t if lower prices mean the club doesn't bring as much in?

The bloke is forking out $10m a year, at least, out of his own pocket because he wants to see the club get back to where it used to be. That includes having big crowds for home games. Maybe he cares more about seeing his club well supported and popular. Just look at how much milage AFL gets out of its big crowd figures. They claim to be more popular even though their TV ratings don't stack up but people believe them because they see full houses. This is not to be underestimated. I don't care if the Knights reducve prices by 50% and only see a 30% increase in crowds. I still reckon the long term benefits will outweight any direct loss in gate takings. And if the club's owner feels the same way then it doesn't really matter what anyone else thinks.

Good post. No doubt clubs do some analysis on crowd figures, but I bet you my left nut that they aren't doing a proper full cost benefit analysis where they consider all tangible and intangible benefits, and if they do they are ignoring the intangibles.

Simple question: do you think Tinklers plan will lead to Knights games being 80%-100% full and do you think that is good for the game.

 

[Bobby DIGital]

Tinkler needs to slash his weight the fat merkin.

 

[Hutty1986]

Tinkler needs to slash his weight the fat merkin.

He's been on a good paddock hasn't he

 

[East Coast Tiger]

Good post. No doubt clubs do some analysis on crowd figures, but I bet you my left nut that they aren't doing a proper full cost benefit analysis where they consider all tangible and intangible benefits, and if they do they are ignoring the intangibles.

Simple question: do you think Tinklers plan will lead to Knights games being 80%-100% full and do you think that is good for the game.

Realistically the Knights aren't going to fill the stadium very often when it's 38,000 capacity. The club record crowd is only 33,000 (admittedly it would have been higher if possible). But it should be averaging 20,000 plus and it hasn't done that in a few years. If/when the side is back to being mostly local products, is hopefully winning more than 50% of its games and ticket prices for families are reduced they will get a few crowds in the 30,000 range and at least 20,000 for some of the lesser games. A home final or a big game against someone like St George could go close to capacity in the right circumstances. The point is, at present crowd averages are well below 20,000, which is woeful for a club that used to regularly get 25k plus, even when it was inthe bottom half of the ladder. If the average is up because of price cuts and therefore more fans are seeing the game more often it can only be good.

 

[East Coast Tiger]

He's been on a good paddock hasn't he

Hey, don't knock him. If every fan was like Tinkler we'd have an easier job filling seats (because it would be two per person).

 

[bazza]

It's only a sensible move if you want to encourage people people to support your team. If not then charge away.

I guess the point that has been made is that simply reducing ticket prices may not lead to increased attendance

 

[East Coast Tiger]

No, I think the point that was made was that it may not lead to capacity crowds and that it might not make the club more money.

 

[Serc]

Has anyone even considered that maybe he doesn't even give a sh*t if lower prices mean the club doesn't bring as much in?

The bloke is forking out $10m a year, at least, out of his own pocket because he wants to see the club get back to where it used to be. That includes having big crowds for home games. Maybe he cares more about seeing his club well supported and popular.

For the record - he's actually topping up our sponsorship etc income up to $10 million if required each year (eg: we have $7 mill right now so he would put in $3 mill)

 

[Desert Qlder]

What is the vibe around Newcastle in regard to the new stand? Is there reason to expect a large upswing in attendances because of its opening coupled with the fact Newie has a pretty good side this year?

 

[undertaker]

Realistically the Knights aren't going to fill the stadium very often when it's 38,000 capacity. The club record crowd is only 33,000 (admittedly it would have been higher if possible). But it should be averaging 20,000 plus and it hasn't done that in a few years. If/when the side is back to being mostly local products, is hopefully winning more than 50% of its games and ticket prices for families are reduced they will get a few crowds in the 30,000 range and at least 20,000 for some of the lesser games. A home final or a big game against someone like St George could go close to capacity in the right circumstances. The point is, at present crowd averages are well below 20,000, which is woeful for a club that used to regularly get 25k plus, even when it was inthe bottom half of the ladder. If the average is up because of price cuts and therefore more fans are seeing the game more often it can only be good.

I thought the new capacity was 33,000 (with the option to expand to 40,000 had Australia won the rights to host the 2022 FIFA World Cup, which didn't occur).

Anyways, regarding your post about crowd attendances, would it be fair to say that Foxtel has had an impact on Knights home crowd attendances? The advent and influence of PayTV on rugby league throughout the years has led to less Sunday afternoon games (whereas in the early years, nearly all of our home games were on Sunday, a day that became known as "football day" for Knights fans). I know 2006 was our last year where we averaged over 20,000 at home throughout the season, and largely due to the fact that we played well that year (Andrew Johns last full season with the Knights). But, in the early years when we were crap, we were still regularly obtaining higher attendances than we have been over the past few years.

Also, another point related to the PayTV aspect is that in the days before Foxtel became available in the Hunter Region in 1999, home games that FTA didn't cover weren't shown until very late (for Sunday games, I remember it was 11:30pm on NBN for home games that Ch9 didn't cover). So, the Knights had the advantage of a 'tv blackout'. Now, in 2011, with a lot more people having Foxtel in their homes, there's more of an incentive to watch the game live on tv rather than go outside on a cloudy or wet and windy day, especially during winter. Whereas in the days before PayTV, there was more of an incentive to go to the game (especially on sunny days) rather than having to wait until close to midnight to watch it on tv.

I dunno, what do you guys think?

 

[Medievalknight]

Capacity will be around 32,000 when completed.