All alternative solutions take into consideration (1) the concessions and the right balance between the price of the tickets and the price of concessions and (2) the way the pricing strategy will encourage the participation of people to the games of the local team. Following this, the alternative solutions seem to include:
- offering a low ticket price and keeping the concessions price reasonably high to complete the company's revenues;
- offering a medium to high individual ticket, corroborated with a lower 5-game and full and half-season packages, in order to encourage people to purchase these forms of tickets;
- keeping all ticket prices reasonably high, assuming that the alternatives to the local minor league baseball team are not that numerous.
As always, the best solution seems to be a combination of the alternative solutions presented previously and the recommendations below will reflect this in the final conclusions.
3. Recommendations
The key to make the right decision likes in comparing the baseball team with a new product being launched on the local market. From that point-of-view, this analysis proposes a penetration price strategy during the first year of operation, continued with a gradual increase in the ticket prices over the subsequent period of time.
This type of strategy is likely to address all the issues previously presented. First of all, the low price will have an impact on consumers, making them more loyal to the team's games. If a consumer attends regularly the team's games during the first year, he will be more likely to accept a gradual increase in the ticket price, as he a more ardent fan. This type of approach will eliminate all other alternatives, such as occasionally driving to Boston to see a game: that will become impossible because the consumer turned-fan will prefer to stay in Springfield to see his favorite team's game.
At the same...
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