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Monday, August 20, 2012
New NBA site to sell fans' tickets, too

By Darren Rovell
ESPN.com

The NBA announced an aggressive move in the ticket landscape Monday, joining forces with Ticketmaster to create the sports world's first website that will list tickets for games sold by both teams and fans.

As fans and brokers have taken to the secondary market to resell tickets, many teams have felt left out of the game, as secondary ticketing sites like StubHub get a percentage from the buyer and the seller.

In one recent survey, the NBA found that 70 percent of fans who had purchased tickets from a secondary site went to the team site first and didn't find what they were looking for. Another survey reflected that two out of every three fans wanted to shop for their tickets in only one location.

This is 'Moneyball' for the fans in terms of ticketing. Teams have used sophisticated data to evaluate players. Now it's time for teams to use sophisticated data to evaluate fans instead of just going with the gut.

-- Ticketmaster CEO Nathan Hubbard

"When you aggregate more inventory, you'll have more eyeballs and more sales," said Chris Granger, the league's executive vice president of team marketing and business operations.

The new yet unnamed one-stop-shop ticketing site is scheduled to debut in October.

The website not only seeks to take business back from secondary StubHub -- which became the leader in the marketplace thanks in part to fans going to the eBay-owned site by default -- but also seeks to make NBA teams smarter about their initial pricing.

"This is 'Moneyball' for the fans in terms of ticketing," Ticketmaster CEO Nathan Hubbard said. "Teams have used sophisticated data to evaluate players. Now it's time for teams to use sophisticated data to evaluate fans instead of just going with the gut. It's time for teams to get data and do what Procter & Gamble and GE does with that data: find the best product for the consumer at the right price in the best distribution channel possible."

Ticketmaster won the deal with the NBA in part because of its analytics platform that has helped teams better dynamically price tickets and because 24 teams are already clients of the company.

While StubHub has managed to get around the ticket-fraud issue by guaranteeing that a duped fan gets a replacement seat, there will be no issues with Ticketmaster, as the transfer of bar codes from the primary and secondary market will be seamless.

Fans who own season tickets with a Ticketmaster team can easily post their tickets onto the new website, a factor that has helped Ticketmaster's NFL secondary site, the NFL Ticket Exchange.

Granger said that the four teams that use the Dan Gilbert-owned Veritix (Cavaliers, Rockets, Jazz and Nuggets) and the two teams that use Paciolan (76ers and Trail Blazers) can also opt in to use the system, which will link to their primary and secondary ticketing platforms.

Whether the site will be effective will depend on how the teams respond. Each team can determine how much it wants to charge the seller to list the tickets and the buyer to buy them. It is also not clear if some teams, sensitive to their product, will institute a price floor that will restrict how low a ticket can be sold for.

"We at the league believe that there should be no price floors so that the market can dictate what the right price is," Granger said.

As for the fees, the league likely wasn't going to do this if it didn't think that it could offer a lower aggregate fee than sites like StubHub, which has higher acquisition costs due to the higher price it has paid for marketing.

The most sensitive area in all of this will be the team's relationship with its season-ticket holders, as its most valuable customers will be able to compare what they spend to what others spend on a single-game basis better than they have before.

"There are two types of season-ticket holders," Ticketmaster's Hubbard said. "There are the real season-ticket holders who use tickets for personal (use) and business and sell some of the seats when they can't go, and there's a second category filled with brokers who aren't fans but serve as a distribution channel for the teams. What teams want to find out is if they're charging the real fan the best price and if they're paying that distribution channel of brokers too much to do their job."

Granger said that he expects the idea of the season ticket to change in the coming years, a topic that all the teams are meeting to discuss this week.

"We know we have to position season tickets differently," Granger said. "It is going to be less about buying 41 games and more about being part of a 12-month membership that gives you different access and experiences in and around your area."

Darren Rovell is ESPN's sports business insider.