Angels don't want poor people at their stadium

MentalDisabldLst · Jun 5, 2015

An alternative, less-dumb-about-economics way to interpret that statement by Alvarado, would be "if I lower the price of these tickets, more people will buy them, but I'll get less total revenue. My job is to maximize total ticket revenue subject to stadium capacity constraints."

I see nothing immoral about that approach. He doesn't have an objection to poor people, so much as he (and his owner) prefer "more total money" to "less total money". Hint: that's a good preference to have if you'd like to accumulate enough wealth to own a baseball team. My bet is, that notion is shared by every single owner of every professional sports team ever (possibly excepting the GB Packers).

It would be a fair question as to why he doesn't have dirt-cheap standing-room-only tickets, as the Sox have done (aren't they, like, $30 for most games?). If he does have them and both he and the reporter neglected to mention them, then they're both dumb; if he doesn't have them, then he's both dumb and bad at his job. But that's an obvious way to let poor people into your stadium if that's really what those people want to spend money on.

derekson · Jun 5, 2015

To review: Alvarado doesn't really want poor people at the Angels Stadium because they don't spend that much money. By trying to attract them, he worsens the experience for wealthier fans. And if he could, he'd segregate the poors from everyone else.

So he wants to replicate the moat they built at New Yankee Stadium?

MentalDisabldLst · Jun 5, 2015

In other stadiums, they call that the "stairs to the upper deck", and/or the "ushers at the entrances to the Loge section".

Aren't there enough things to shit on the Angels for without having to bend over backwards to invent some outrage on this count?

Monbo Jumbo · Jun 5, 2015

I am shocked, shocked to learn leftists don't understand economics.

DLew On Roids · Jun 5, 2015

As I am equally impressed that a couple of neoliberals would think that a simple pricing model encompasses all the goals of an organization. Let's come back in a couple of years and see if the tactic of short-term revenue maximization has people continuing to support a shitty product.

Hank Scorpio · Jun 5, 2015

I'm not understanding why they Angels wouldn't be better off lowering the ticket prices of the less desired seating. Sure their average sale per fan might drop, but it's not like they need to build each new fan a seat when they buy a ticket. The seats are there. They can either bring in $X or $0. Unless you're lowering the price to a level where the park becomes overrun with bums and gang members (which would drive away the higher ticket fans), I don't see why you wouldn't want to sell out as many seats as you can.

Savin Hillbilly · Jun 6, 2015

Monbo Jumbo said:
I am shocked, shocked to learn leftists don't understand economics.

What makes you think he doesn't understand the economics of the situation? He didn't say that Moreno isn't making more money with this approach. He's asking Moreno, as the leader of a community institution, to temper his desire to make money with other considerations.

MentalDisabldLst · Jun 8, 2015

Savin Hillbilly said:
What makes you think he doesn't understand the economics of the situation? He didn't say that Moreno isn't making more money with this approach. He's asking Moreno, as the leader of a community institution, to temper his desire to make money with other considerations.

That's noble and all, but the title of this thread and the tone of the article both suggest that the Angels are doing something unusual here, something beyond the pale. Every single one of the teams in MLB, the NHL, NBA, NFL, MLS and so on are all hiking their ticket prices as quickly as the market will bear them. He's not appealing to a "community institution", he's appealing against the idea of capitalism. If the community wants some concessions, they should wring them out of the owner when negotiating for tax breaks for his new stadium. Most "communities" tend to settle for just bringing in the economic activity that the team and events might provide. That should tell you how much the "community institution" card is worth when it's played on the open market.

Cellar-Door · Jun 8, 2015

MentalDisabldLst said:
That's noble and all, but the title of this thread and the tone of the article both suggest that the Angels are doing something unusual here, something beyond the pale. Every single one of the teams in MLB, the NHL, NBA, NFL, MLS and so on are all hiking their ticket prices as quickly as the market will bear them. He's not appealing to a "community institution", he's appealing against the idea of capitalism. If the community wants some concessions, they should wring them out of the owner when negotiating for tax breaks for his new stadium. Most "communities" tend to settle for just bringing in the economic activity that the team and events might provide. That should tell you how much the "community institution" card is worth when it's played on the open market.

Most teams are trying to sell-out, and raise each level of tickets to the highest spot where enough people will buy them to come close to filling the seats, that's the best way to maximize your profit.
The Angels model is actually pretty different. They're implying that they don't want to sell out, they want to make the most money possible per seat, even if that means leaving huge swaths of less desirable seats empty.
It would be interesting to see if he's right, but his argument appears to be that rich people will pay more money for premium seats in a half empty stadium than in a full one, because the presence of poor and middle-class people devalues the good seats in some way. I'm not sure I buy that. The premium seats at Fenway sell just fine at a higher price than the Angels charge for comparable seats and the cheap seats are usually pretty full too.

nattysez · Jun 8, 2015

From the original article:

Ten-dollar tickets (plus a few bucks in fees) for Wednesday night’s game against the Rays were still available an hour before first pitch, so it’s not as though the cheap seats have been eliminated.

Doesn't that fact moot all of the hand-wringing about the poors getting excluded from the stadium?

Further, isn't this just a case of the Angels seeing their total ticket sales drop and trying to invent an explanation for why this isn't a problem? This seems mostly like a ticket sales guy trying to save his job, more than anything.

kenneycb · Jun 8, 2015

Cellar-Door said:
Most teams are trying to sell-out, and raise each level of tickets to the highest spot where enough people will buy them to come close to filling the seats, that's the best way to maximize your profit.
The Angels model is actually pretty different. They're implying that they don't want to sell out, they want to make the most money possible per seat, even if that means leaving huge swaths of less desirable seats empty.
It would be interesting to see if he's right, but his argument appears to be that rich people will pay more money for premium seats in a half empty stadium than in a full one, because the presence of poor and middle-class people devalues the good seats in some way. I'm not sure I buy that. The premium seats at Fenway sell just fine at a higher price than the Angels charge for comparable seats and the cheap seats are usually pretty full too.

I interpret his argument as being poor and middle-class people don't spend as much at the ballpark as wealthier fans on food, beer, merchandise, etc.

Bosoxen · Jun 8, 2015

I think too many people in this thread have their opinions colored by the Red Sox model. Remember the sellout streak and all that came with it? That doesn't happen anywhere else. Teams are most certainly not trying to sell out every single game. They're trying to maximize their profits by squeezing every dime out of every ticket they can. Whether or not that means having the ballpark at 30% capacity makes no difference to them. Selling out every game is a luxury most teams can't afford, because for the majority of them, it requires dropping ticket prices to a level that's not economically feasible - more butts in seats means more operating costs and a point of diminishing returns (as kennycb alluded to).

It's really that simple and trying to read so much into it is just looking for reasons to complain - or you have an axe to grind, which is what I'm guessing was the motivation of the author.

splendid splinter · Jun 8, 2015

kenneycb said:
I interpret his argument as being poor and middle-class people don't spend as much at the ballpark as wealthier fans on food, beer, merchandise, etc.

Right - he's not saying wealthy fans won't pay as much for seats if they have to sit next to the unwashed masses. He's saying that lowering the price of tickets in sections that don't sell out isn't going to maximize revenue, because the loss he will take on the tickets he's already selling will not be offset by the additional tickets he might sell, particularly since poorer fans don't spend as much on concessions. That's what he means when he refers to not being able to "segregate" tickets - he can't charge $50 to sit in Section 105 if you make $100K, but only $20 if you make $40K.

timlinin8th · Jun 18, 2015

splendid splinter said:
Right - he's not saying wealthy fans won't pay as much for seats if they have to sit next to the unwashed masses. He's saying that lowering the price of tickets in sections that don't sell out isn't going to maximize revenue, because the loss he will take on the tickets he's already selling will not be offset by the additional tickets he might sell, particularly since poorer fans don't spend as much on concessions. That's what he means when he refers to not being able to "segregate" tickets - he can't charge $50 to sit in Section 105 if you make $100K, but only $20 if you make $40K.

I also saw it as him saying there's only a certain price differential the market will bear between "premium", "mid tier", and "economy" level seating. If they underprice the economy level seating, it inherently devalues the price of the premium seating. Given enough of a price gap between the different tiers of seating, someone who might have otherwise opted for a premium seat may opt instead for a mid tier one, or from a midtier down to an economy seat based on savings. They'd rather jack the prices and potentially not fill the economy seats, than the opposite and have empty premium seats with filled economies (see: Stade Toilette Nouveau).

30 of 30 MLB teams do this in seat pricing valuations - find the balance in pricing between tiers that the market will bear that will maximize profits. He's resigned based on poor wording.

CaptainLaddie · Jun 18, 2015

derekson said:
So he wants to replicate the moat they built at New Yankee Stadium?

Or Fenway before HWL?

BigJimEd · Jun 18, 2015

He's resigned based on poor wording.

He resigned because as the VP of Marketing he should know better than discuss this publicly.
That's a discussion with his bosses not the public. All he's doing is making his department's job harder.

kenneycb · Jun 18, 2015

BigJimEd said:
He resigned because as the VP of Marketing he should know better than discuss this publicly.
That's a discussion with his bosses not the public. All he's doing is making his department's job harder.

He's making the PR department's job more difficult. I imagine the marketing department and their tactics won't change much going forward.

timlinin8th · Jun 18, 2015

BigJimEd said:
He resigned because as the VP of Marketing he should know better than discuss this publicly.
That's a discussion with his bosses not the public. All he's doing is making his department's job harder.

That was basically my point, there's a way he could have skipped around it and candy coated it and nobody would have cared. But because he was so blunt about talking about how they want to maximize profits and drain gamegoers of every last penny, he gets put on the hot seat even though its the nature of the biz (or any biz). I agree, he should have known better, the clueless masses are best left clueless.

*edit fat thumbs posting on mobile again*

HriniakPosterChild · Jun 19, 2015

Al Campanis would say he just didn't have the necessities.

DavidTai · Jun 19, 2015

I have no words beyond a facepalm:

http://hardballtalk.nbcsports.com/2015/06/19/the-angels-rookie-league-team-is-holding-a-caucasian-heritage-night/

Angels don't want poor people at their stadium

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