Nhl Profit Maximization Case Study

For now, let’s look at how the number of Starbucks (supply) impacted the demand for this product. Supply and demand have an inverse relationship. This means that as supply increases, demand decreases and vice versa. Starbucks presents an interesting example at how this concept works (Miller, 69).

The level of pricing is directly related to the location of the seats in the stadium. If a customer purchases seats in section 300, prices will be cheaper than those in section 100 or 200. Also, those customers attending games in box seating will be subjected to the highest ticket prices in the entire stadium. As for prices for season tickets, the prices are based on the section of seating with a discount since a customer will reserve those seats all season rather than the seat not being sold. The prices for the season ticket provided by DirecTv is set by the company, and no other television provider has no other offer in the market currently.

The reason for not maximizing the revenue from ticket sales is if there will be increase in ticket price there will be lower attendance which will decrease the sales of complementary associated with sporting attendance such as merchandise, concessions and parking.

The Sixers are the 23rd most valuable team in the NBA valued at $469 million (Forbes) and they have an operating loss of 3.8 million dollars year. Teams in Salt Lake City, Portland, Sacramento, and Oklahoma City are valued higher than the 76ers who play in the fifth largest city in the United States. The Flyers on the other hand are the 7th most valuable team in the NHL and are valued at $500 million and they bring in $95 million worth of revenue. The Flyers bring in $60 million in terms of tickets sales while the 76ers only bring in $27 million. On the popular ticketing selling website Stubhub the Flyers only have 2 games where tickets are under twenty dollars, while a fan of the 76ers can get tickets for under twenty dollars for thirty-fourt out of forty-one home

As alluded to earlier, MLB franchises are awarded exclusive rights to broadcast games in their local markets creating a monopoly in the franchise 's immediate area. It must also be taken into account that when comparing attendance averages and price comparisons that not all ballparks have the same capacity or have equal numbers of choice seats. Nor do they share the same number of seats where there may be obstructions and prices are discounted. It must also be noted that not all markets are equal in terms of population and demand for sports entertainment when there are other professional sports franchises in that local market. With those disclaimers in place we can now analyze if ticket demand is elastic, unit elastic or inelastic.

It was also a home to a CFL Team, the Winnipeg Blue Bombers and an AHL team, the Manitoba Moose. Since the median family income of Winnipeg is Cdn$62,955, the target market for the Nashville Predators would be men and women with stable jobs and a high average income. The diehard traditional fan base would primarily comprise of men and women with a median age of 38.7, who are single or have small families, have a bachelor’s degree and have a steady job with a disposable income and an active lifestyle. These fans are passionate and enjoy the aggression involved in the game. The casual fans would mainly consist of families or customers who watch NHL as an entertaining experience and hence, are looking to get the best

Due to the high costs the goal of breaking even is a large task. At current product prices a profit of $53,676 can be expected. This is total by 21,582 who will at least attend one game. Next we can assume that amongst that population of 21582 54% would be interested in going to one game, 28% interested in at least 5, 13% would be interested in half season and 5% in full. Of the 54% who will attend one game 80% would pay $10.

Pricing Strategy The pricing strategy used by a sports team will affect the market share. Because Calgary is a large market, FC Calgary Foothills PDL should attempt to capture a larger market share. The best was to increase market share is though penetration pricing.

Economic theory introduces us to four different types of markets: perfect competition, monopolistic competition, oligopoly, and monopoly. Professional sports teams operate in an environment that is different than the typical business structure. The goal of this paper is to look at this industry, in particular the NFL, in an economics context and gain an understanding of the market structure of this unique industry. To do this I will discuss a brief history of the National Football League in the U.S. and how this organization is structured. I will also discuss typical market structures and type of

One of the fundamental problems with Canadian hockey teams competing with their American counterparts is that Canadian teams pay all of the player's salaries and travel are in American currency. However, all the revenue from ticket sales, concessions and advertising is in Canadian currency. American teams have an advantage over their Canadian counterparts because all the money that was created from ticket sales, concessions and selling advertising is one-third more than what Canadian teams will make. This is because of a weaker Canadian dollar, 69 cents to one American dollar, means that Canadian franchises will always make one-third less from basic franchise profits as long as the Canadian dollar stays the same. "The teams are among Canada's fewest businesses that pay most of their salaries and expenses in U.S. dollars out of revenue earned in depressed Canadian dollars" (May p 2). This is a problem because the weaker Canadian dollar makes it harder for these franchises to run day-to-day operations (Duhatschek 7). "The result is

A good pricing strategy has several characteristics. First, it must be attractive to sell as many tickets as possible. The price must be affordable to the visitors. If the ticket is priced too high, fans will likely stay home and simply watch the game on television. Tickets must be priced reasonably, so as to attract the fans to purchase them to attend the event in person. Tickets must also be priced to reflect the popularity of the sport. If you set the price of the tickets too low for a popular event, you will likely miss an opportunity to generate revenue. If you set the price high for a scarcely popular event, you will not generate enough ticket sales, leading to empty seats and a poor attendance showing for an event. A good pricing strategy will balance several components of the sport. It will balance popularity, fan base, interest, and ability to market. Williamson should consider these factors as they determine the pricing strategy for the 2012 Olympic Games. Using the economic pricing strategies allows more fans to purchase the

Understanding the fundamental concepts of economics allows us to analyze laws that have a direct bearing on the economy. These laws and theories are essentially the backbone of how economics is used and studied. The law of demand can be expressed by stating that as long as all other factors remain constant, as prices rise, the quantity of demand for that product falls. Conversely, as the price falls, the quantity of demand for that product rises (Colander, 2006, p 91). Price is the tool used that controls how much consumers want based on how much they demand. At any given price a certain quantity of a product is demanded by consumers. As the price decreases, the quantity of the products demanded will increase. This indicates that more individuals demand the good or service as the price is lowered. This can be illustrated using the demand curve. The demand curve is a downward sloping line that illustrates the inversely related relationship of price and quantity demanded.

This concept will show Will Bury how the price of substitute goods offered by competitors will be Based on how much his product sales.

In economics, we need to use terms a little more carefully than they are sometimes used in ordinary discussions. In general use, "Demand" is a word that can have more than one meaning, but in microeconomics we define it more carefully so that it has only one meaning. Here is the definition:

During the decline in economy activity, the spending power will decrease which is similar as the decline in income. Home food which is economical are inferior goods while restaurant food which is