The Secondary Ticket Market Is The Primary Market For Consumers

Without Google, Inc.’s birth in 2000, the secondary ticket market wouldn’t be where it is today. And that’s not a bad thing, because for the first time in history, fans have more choices when they purchase tickets. Not just on price, but location, opponent, and when how they invest their dollars.

SEO Matters

Prior to Google’s search engine optimization (SEO), tickets were distributed solely through the primary ticket market. The brokers that tickets only dealt with teams, and sold on a minimal level simply by virtue of their distribution access. After SEO, ticket resellers sat on par with the primary ticket market, meaning that they could sell to the exactly same customers as the teams did online. And in many cases, ticket brokers have often done a better job of catering to the general consumer than the sports teams do.

Ticket reselling is that billion dollar business that every consumer loves to hate, especially when the media writes stories about inflated prices. But here’s the thing, no one has to buy any tickets on at any price point that they believe is unfair. They can just sit at home, and if the ticket reseller can’t find a buyer, as the event goes closer, often the prices drop. But that’s not all, the consumer now has the ability to control location, opponent and other factors, simply by not purchasing until they choose to. And all without being locked into a long-term package of financial investment, such as a mini-pack or season ticket, by a team.

The Consumers Choice Is The Secondary Ticket Market

This is what the secondary ticket market has done. It has become the primary ticket market for a majority of the consumers. And each team has reacted to this not by figuring out ways to adapt through digital means. Instead, the majority of teams are still focusing on sawmill sales staffs tactics, where young sports account executives new to the business make 100+ phone calls per day. Here’s the rub in all of it: Even the kids hired today know that the practice that they are undertaking is rather silly, outdated, and not working.

In January 2016, up to 40 sports executives were fired from Madison Square Garden, for ticket reselling their own product. They legitimately purchased their tickets from their parent company, then resold them on the secondary ticket market. Because those executives understood what MSG and others want to deny. MSG should have asked why this practice of purchasing primary tickets and flipping them on the secondary market was working, but they did not.

Digital Is King, Not The Phone

The majority of consumers are buying off of digital means, and they aren’t generally buying long-term packages such as season tickets. Most would rather pay higher premiums, up-front, for a single game ticket in a better seat location to the exact game that they want, rather than pay less, for a multi-game package in an okay seat location to three dog games plus the game that they really want.

There’s a lot to be learned about the secondary ticket market, both in the lawsuits against closed market practices, as well as the leagues and teams reaction to it. In the new sports marketing textbook, Sport Business Analytics, I wrote about the secondary ticket market overcoming the primary market, as well as some of the legal actions that have taken place. Not just the 2015 StubHub dismissed suit against The Golden State Warriors and Ticketmaster, but also The Ticket Wars legislation which has been waged in the state of Florida over the years with massive lobbying efforts for a closed system.

All of this comes down to consumer choice and the inability for sports executives to adapt to the digital age. While sports executives have resisted the allure of the secondary ticket market or its technology, ticket brokers have become more innovative. I’m surprised that the brokers themselves haven’t decided to charge the sports teams to sell their tickets. Often, they are creating way more conversions than the 100-phone-calls-per-day metric. And its showing… continually…

Note: You can order Sport Business Analytics textbook to read up on several the issues surrounding the legalities of the secondary ticket market in Chapter 3. In it, I look at various trends and narratives such as the L.A. Dodgers’ ticket flooding from 2013-15, Tom Brady’s 2015 Weeks 1-4 “almost suspension” and the Pacquiao-Mayweather fight:

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Troy Kirby has helped generate revenue for three college athletic departments and professional teams. Owner of The Tao of Sports, which focuses on Sports Sales & Revenue Analytics, Kirby has interviewed over 600 sports executives for a three-times per week podcast and writes daily about sports business, including the secondary market. Founder/President of NAATSO, the only college ticket association, as well as the creator of The Sport Sales Boot Camp. Kirby is also a frequent contributor to The Association of Luxury Suite Director's quarterly publication, SEAT Magazine, and Ticketing Today.