Great, you think. The organization must be having financial problems. Not so fast as the Boston Globe pointed out in an article on the shrinking size of most major league ballparks. (April 20, 2006). We Bostonians have been hearing the Red Sox management crying for years about the pathetically small Fenway ball park. Turns out less is more; less capacity is more money.
“Since 1995, average seating capacity at major league parks has fallen 11 percent, from 51,106 to 45,395. At the same time, average per-game attendance has jumped 22 percent, to 30,936. And as tickets have gotten scarcer, the prices have more than doubled, to an average ticket price this year of $22.21, according to Team Marketing Report.”
The perception of scarcer tickets drives season ticket sales, leaving fewer seats for individual games, which drives season ticket sales, and so forth. While a ball park in California does not compete directly with Boston’s Fenway Park, the principle is the same.
Has your competitor altered its capacity because of a change in pricing strategy, or because of a slowdown? Check it out since your competitive response will vary greatly depending upon the answer.