Angels exec: We don’t care about poor fans, because they don’t buy enough hot dogs

You know how often we will talk here about how the modern sports industry is all about selling tickets to rich folks, because that’s where the money is? Meet Los Angeles Angels vice president of marketing and ticket sales Robert Alvarado, who is not afraid to admit that not only does he target deep-pocketed fans, but really he’d just as soon fans without a lot of spending money stay the hell home:

“The conventional wisdom would tell you, ‘Let’s get the bodies in here, because they’re still gonna be spending money on parking, hot dogs, souvenirs, all that stuff.’ But we have not seen that in the past. Drawing in a discount buyer, they aren’t necessarily flipping and buying stuff here.”…

“We may not be reaching as many of the people on the lower end of the socioeconomic ladder, but those people, they may enjoy the game, but they pay less, and we’re not seeing the conversion on the per-caps,” Alvarado said. “In doing so, the ticket price that we’re offering those people, it’s not like I can segregate them, because I’m offering it up to the public, and I’m basically downselling everybody else in order to accommodate them.”

The OC Weekly seems to think that by “segregate” Alvarado means setting up a special poor-only section at the ballpark; I think he actually was complaining that if you offer tickets at a price regular people can afford, then the upper crust will buy them at that price too, and you’re leaving money on the table that you could have effectively extracted from rich folks’ wallets. So better to charge everybody a ton for tickets, and if the “people on the lower end of the socioeconomic ladder” don’t show up, that’s okay, because the people with money buy more hot dogs.

That’s really no different than teams wanting smaller stadiums so that they can sell fewer tickets at higher prices, but it’s said a bit more bald-facedly. So thank you, Robert Alvarado, for explaining the modern sports industry in simple English. Even if it might not win you many friends among Angels fans who can’t afford as many $4.50 hot dogs.

[UPDATE: Alvarado just resigned. Honesty gets you nowhere these days.]

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Why new stadiums aren’t better places to watch sports, in two photos and a french fry story

I took in the Argentina-Ecuador soccer match in New Jersey on Tuesday night, which was my first chance to see the now five-year-old stadium that the New York Giants and Jets built to give themselves a more luxurious setting than the old Giants Stadium across the parking lot. And I’ve gotta say, my initial reaction was much like my first visit to the new Yankee Stadium: They spent more than a billion dollars for this? I mean, here’s the view from our seats:

met-lifeIt has a ribbon board, and those big video screens in the corners, and obviously a bunch of luxury suites and clubs that I didn’t have access to. (Also, yes, that’s snow that you see falling. No more outdoor sporting events in March for me.) But overall, for average fans there’s nothing particularly better about actually watching a game here over the old place — in fact, from the end zone seats it didn’t feel all that different from being at one of the old “concrete donut” multipurpose stadiums like Veterans Stadium, only with more cupholders.

And as for being out of the seats, which is where modern stadiums with their massive footprints are supposed to shine, things were if anything even worse. Here, for example, is the view of the concessions concourse during halftime:

met-life-halftimeYes, soccer halftime is always a madhouse since no one wants to leave their seats during the action and risk missing the only goal, but this was beyond awful. After fighting my way through a crush of people to find the end of one concessions line — but allow me to just quote the customer survey that the stadium people kindly requested that I fill out after I attended the game, no doubt not knowing what they would be in for:

The staff were all fine. The logistics, however, were a nightmare: It took us forever to find our way to our seats (on the 200 level opposite the train station, requiring that we climb to the 300 level then come back down again) and find our way back to the train, the crush to leave after the game was appalling (despite only 48,000 fans in attendance), the concessions lines were the worst I’ve ever seen at any stadium, and the concessions stands were incredibly backed up at having enough food. (Some of this may have been because it was soccer when there’s a big halftime rush to the concessions, I understand, but maybe plan ahead for this a little?) And fortunately we were under an overhang, or it would have been miserable sitting in the rain and snow, especially with your no-umbrellas policy. Also, the ad signage was so irritatingly ubiquitous (video ads even during play, really?) that even my 12-year-old son, who *likes* commercials, was complaining about it.

I’m not sure what to suggest, as a lot of these problems seem inherent to the stadium design, but hiring more staff to direct people and way better signage would be a start. I’d go to MetLife Stadium again if some event I absolutely had to see was happening there, but I wouldn’t be happy about it. And next time I wouldn’t bother to try to get french fries.

This has been the most surprising discovery of my years of research into the new-stadium game, and one I have to keep explaining to people: New sports venues, on the whole, kind of suck. They’re far more geared toward serving luxury customers — who are the ones willing to pay the big bucks that justify these buildings, when they can be justified at all beyond the desire for public subsidies — than toward things like making sure that people can line up for the restrooms without creating a traffic jam. It’s not so much that stadium and arena designers are doing a bad job — though in many cases they arguably could be doing far better — as that making for a better fan experience is fundamentally not the goal of these places. Separating fans from their money, especially fans with lots of it, is, and despite anything you may have heard about the free market supposedly reflecting the demands of customers, there isn’t always a direct alignment.There are many reasons why we’ve seen a rash of new stadiums and arenas in the past 30 years, but one factor that shouldn’t be overlooked is that it’s a land rush to serve a new market: There weren’t that many people with tons of disposable income to blow on upscale ballpark food in the 1970s, whereas now, well, we all know what’s happened. I once wrote an article for the late, lamented Village Voice sports section that talked about A-Rod’s then-record salary and suggested blaming it all on Ronald Reagan’s tax cuts for the wealthy; that was an oversimplification then, and even more so now that we know that much of the rise in inequality was actually the result of Reagan’s SEC rules, but if you want to shake your fist at someone for having to pay higher ticket prices for a lousier experience, you could certainly pick a worse target.

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Indians lower beer prices a dollar, threaten to overturn entire sports business paradigm

This is interesting:

The Cleveland Indians are making the cost of a 12-ounce domestic brew $4 at every home game.

For perspective, according to, the average price of a beer in Major League Baseball last season was $6.10 with the highest price at $8.00 for a beer to watch the Miami Marlins (lose)…

Cleveland did not stop at beer. Hot dogs go from $4.50 to $3.00, charging only $1.00 at 15 specific games. Most other food items will see a 25 percent price cut.

It’s interesting not just because it’s a rare example of a team with a new(ish) stadium choosing to lower concessions prices (beers were previously $5 in Cleveland) in order to draw fans, nor because it shows that even articles about Cleveland Indians beer prices can’t resist digs at how awful the Marlins are, but because of this article by Baseball Prospectus editor Ben Lindbergh, wherein he descibed how the Indians “applying some of the same principles to marketing as the game’s new breed of progressive GMs has to Baseball Ops.” For starters:

The Indians gave the company five years of historical data (2007–11) on attendance, ticket sales, and promotions, and ThinkVine used it to generate an agent-based model (as opposed to a more traditional econometric, or regression-based approach) that would help the team develop a “base probability” that an Indians fan would attend any given game. That base probability can then serve as the foundation of a forecast for attendance with one or more additional draws. In theory—and, King is confident, in practice, too—the model allows the Indians to quantify the effects of “exogenous factors” (team performance, weather, competing events, the Cleveland economy, etc.) and isolate the impact of marketing techniques.

I know we’re all used to thinking of sports franchises as money-hungry evil Machiavellian blood suckers, and they are (though economists still aren’t all in agreement on the blood thing). But sometimes they do things just because they’re dumb, whether it’s setting ticket prices so high that nobody sits in the good seats or giving Mike Hampton $121 million. Is it possible that jacking up food prices to beyond the point of ridiculousness is one of those?

According to Indians VP for marketing Alex King, maybe. Among his findings from the ThinkVine survey: dollar hot dog days were the biggest draw, even better than bobblehead giveaways. (Though fireworks nights did better at getting people out to the park when the team was losing.) And the most profitable promotions were cap giveaways, since caps can apparently be made for next to nothing, and everybody likes getting caps — as a result, you pretty much won’t be able to go near an Indians game this year without somebody shoving a cap in your hands. (Not mentioned in Lindbergh’s article: Caps are also a great form of free advertising.)

Now, there’s no guarantee that even if this “sabermetric” marketing catches on, it’ll be good for fans: It’s just as likely that teams will start identifying bargains they don’t need to be offering, and eliminating them. Or, it could just mean the end of six-dollar beers. Either way, though, it has the potential to change the economics of sports, so it’s well worth keeping an eye on.

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