Springfield Nor'easters Baseball Team

Li Tsz Yin Patrick (20192823)        ISOM4820 Assignment 1

1. Mr. Buckingham has to decide the pricing of Nor’easters baseball team tickets of different packages and the price of concessions. As he had no experience and market data of the local market and the industry he has to carry out survey to find the price sensitivity and sports attendance pattern, which is necessary for him to make forecast and select the suitable pricing strategy. So the revenue from tickets and concessions can breakeven the cost in the first year.
2. There are two types of tradeoffs he is facing. The first tradeoff is he has to set the ticket price high enough to distinguish Nor’easters from college teams but low enough to lure fans away from driving to Boston. The second tradeoff is setting the price high enough to make it too costly for the customers to no-show for the game but not the same time not too high which reduce the attendance. It is because a high no-show rate will decrease the revenue from concession sales which will reduce the revenue from customers.
3. The key findings of the survey is the willingness of the price the target customers are willing to pay for different ticket packages, how many games they would probably attend and how much they are willing to pay in concession sales. These data can be used to determine the suitable price of concessions and different ticket packages with the data of the expected number of customers that are willing to pay for tickets and concession sales.

1. Nor’easters should employ value-based pricing and market-based pricing. It is because value-based pricing focus on the customer’s willingness to pay for the services. Since we have the survey data of our target customer’s willingness to pay that price can be estimated using the data provided. This can make sure that the price is being acceptable to customers and able to make revenue. The price should also be adjusted according to the competitors, we should charge at the price range between the college teams and the major league teams to attract our customers as we are direct competing with them, we have to lure customer from the other entertainments to our baseball team.
2. The team will not be able to breakeven in the first year. The total revenue from tickets and concession sales will be $998,969 and the cost need to be covered is $1,005,879.