SAS Global Forum attendees got to hear the story this week of one such program implemented by Anthony Perez, executive vice president of strategy of the Orlando Magic. Perez isn't in charge of player performance, although he admits that the team's record does impact ticket sales. This former analyst for investment banker Goldman Sachs joined the Magic about a decade ago and began an analytics journey with SAS (the sponsor of this site) in 2010.
Back then the team kept the same seat at the same price for the entire season, and Perez was trying to figure out a better way to do it. For instance, if ticket sales were strong, could the team raise prices by 5%? Or could the team model ticket price behavior using secondary market data? What if a strong matchup game was on the schedule? Should the team increase prices for tickets to games that more people wanted to see?
Perez's journey took him down the road of working to enhance the fan experience, particularly the experience of valuable fans like season ticket holders, and also to maximize revenue for the team.
For instance, did season ticket holders buy those tickets for their families, for their friends, or for their businesses? Perez said that in many cases it was a combination of all those things.
The early analytics also sought to resolve questions such as how to allocate different ticket types, for instance, bulk vs. discount vs. rack rate. Which games should cost more and how should the inventory be optimized were a few of the questions Perez wanted to answer.
"Some of those things are obvious now," Perez told SAS VP of Best Practices Jill Dyche, who interviewed Perez on the mainstage at the SAS Global Forum.
Perez acknowledged that season ticket sales are not as popular as they once were among fans, and that may be because fans want more flexibility.
"The idea of buying the same seat for every game is slowly going away," Perez said. "And it's given us a great chance to innovate, and to explore what that means. How do we create the flexibility that fans value?"
Perez said that fans are looking for new adventures. His team is working to figure out the product to fulfill that desire that fans have now. A mobile app introduced two years ago is providing a more interactive experience for fans and more insights for Perez's team.
The Orlando Magic also operates a restaurant that serves meals before games. Perez's team has been observing fan behaviors at the restaurant, and offers a loyalty program for fans, giving them "Magic Money" that they can use for seat upgrades, ticket purchases or Magic Marketplace experiences, including meal credits at the restaurant.
Among observed fan behaviors, the team has found that the restaurant sells better when the Magic plays really good teams. Also, more people go to the restaurant at the end of the season, trying to spend their Magic Money before it expires at the end of the season. Perez says the team has offered menus according to fan behavior, with more expensive and higher-value menus when the Magic plays better teams.
Ultimately the goal is to encourage fans to engage more than they do now.
"If they are coming to one or two games, we want them to come to three or four," Perez said.