On the eve of this year's tennis open championship at Rod Laver in Melbourne, there is an understandable concern brewing over ticket prices, particularly corporate. This year's prices were set in mid-2008, well before the US financial crisis hit, and well before the readjusted downturn in both China's and Australia's economic growth / activity / consumer confidence forecasts.
The tennis open has been riding a (seemingly unstoppable) wave of consumer support for years, with attendance records broken year-after-year. It's a great event, no doubt.
2009 will be interesting to watch, and may be the first real gauge to the anticipated dips in corporate spending for the year ahead.
General seating tickets have risen 9% - 29% from 2008 ($59.90 - $289.90). Ground passes remain unchanged ($19 - $29), but there are add-ons for entry to the new 'Spiegelworld' for 'Absinthe', 'Concerts', 'Family Circus' and 'A Day on the Baseline' ($19.90 each).
From a corporate point-of-view, prices have risen by up to 25%. It's expensive going in this current climate, and sales are not good. The main corporate tickets include Bronze ($3,990 each), Silver ($4,990), Silver Premium ($9,450), Gold ($5,990) and Gold Premium ($10,450). Basically, the 'Premium' options include buffet dining for all 25 sessions, the others don't, just the lower-tier padded seat for all 25 sessions and access to purchase dining from The Oval or Australian Open Dining Restaurant.
The problem has been compounded by a new trend being followed by the major sports - to assign a select number of authorised 'on-sellers' to sell their corporate packages. The AFL, VRC, and the Australian Grand Prix Corp have been the instigators. These major sports are believed to meet regularly about "strategic marketing" initiatives.
Whilst there are obvious merits to this strategy - to control brand, control pricing, control distribution, and reduce fraud, this augurs well for a free-spending economic climate. In such a climate, demand for these tickets has outweighed supply.
In 2009, things could be different - a select number of appointed 'on-sellers' (there are three for the tennis this year) may simply not have the reach to sell all the tickets. So what then?
Well, two things possibly. One - you'll see some lower tier sections of Rod Laver Arena empty. Two - you'll see some corporate tickets for sale at a reduced price, this is already happening.
The strategy to limit corporate packages to authorised 'on-sellers' is a good one, but it is not working properly.
The AFL appoint three or so 'on-sellers' (plus their AFL Clubs) to sell their highly-priced 'Centre Square' function for the AFL Grand Final. Tickets are "set" at $1,995 pp. The lowest offered price for the 2008 Grand Final was believed to be as low as $700.
Interestingly, a move by the AFL to take control of more of the Club's allocation of Grand Final tickets for 2009 is set to be delayed for a year...due to the current conomic climate. Hmm, shouldn't they actually be picking up the slack for Clubs in such a climate (save that for another blog!)??!!
The VRC have a similar strategy to their famous Melbourne Cup Carnival event. They appoint around 15 authorised 'on-sellers'. This is a more sensible number - it's a big market and there are a lot of genuine 'on-sellers' that contribute well to this market.
It is wise to enforce control of your product, that's for sure. Unwise to limit your reach. Companies that are asked to take an unreasonably high level of exposure to sell your product will either go bust, look to engage other 'on-sellers' on their behalf, or be forced to sell tickets at a discount in order to minimise the loss.
The problem with the Corporate Hospitality industry is there is no such industry, no association exists, there is no self-regulation or membership. There has been talk amongst major on-sellers for one such association to be established, and I believe the 'Australian Corporate Hospitality Association' as a company has been registered.
This is the first step towards creating a more trusted Corporate Hospitality industry, where hospitality companies will have to qualify to earn association accreditation. The industry will become self-regulating, and then more proactive and useful discusions can take place between the rights holders and Corporate Hospitality Association members, for a more sensible strategy on corporate ticketing. Each needs the other in order to be successful. This is more the case now in such an uncertain economic climate.
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