Wembley Stadium pricing study Essay -- essays research papers

Ticket Pricing Strategy for the new Wembley field1IntroductionOBJECTIVETo maximise profits from ticket sales at Wembley StadiumKEY ASSUMPTIONS1. Wembley has a monopoly on certain types of match 2. Wembley is run by profit maximising managers selling tickets to utility maximising buyersSTRATEGYSet prices for pose as close to the willingness to pay as possible using price discriminationKEY CHOICESWhat type of seating to sell and at what price?2ScopeThis strategy is limited to the following football matchesEngland home matches competitive and friendlyMajor loving cup semi-finals and finalLower league play-off finalsWembley has a monopoly on these matches due to Football Association (FA) policy2. Theory states that Wembley should charge as close to the willingness to pay of its customers as possible to maximise its profits1. The ability to do this depends on consider and the ability to price discriminate between market segments. 3Absolute Demand Absolute demand for tickets will be h igh due to several(prenominal) factorsFootball is Englands national sport Watching live matches is popularWembley Stadium is the home of football with a long and distinguished history in that respect is good evidence for assuming high demandThe last three competitive England home games were sold-out2Attendance figures for club matches be consistently high3 Recent cup finals at Cardiff Millennium Stadium were sold-out4Actual demand varies between market segments but can be found from market research, e.g. membership schemes and studying events at similar grounds. 4 grocery SegmentationThe table below shows the range of customers that buy tickets for football matches. Elasticity of demand is shown for each category and explained below Market SegmentsElasticity of DemandReason for Elasticity1&nbs... ...y for rugby union and leaguePop concerts outdoor arenas are alternatives with similar capacityThere are a wide range of substitutes available for these that affect willingness to pay . 11Other Event-Related Income Stadiums contain much more than just an arena to watch sport includingRefreshments and trade in Broadcasting rightsAdvertising Car parking Other events, e.g. conferencesIncome for the above would be approximately proportional to the number of people in the stadium. 12References 1.Cabral, Luis. Introduction to industrial Organization, MIT Press, 2000. 2.www.thefa.com 3.http//stats.football.co.uk/dom/ENG/PR/attend.html 4.http//stats.football.co.uk/dom/ENG/trn/ENGFAC_F.htmlF 5.www.wembleystadium.com6.www.millenniumstadium.com