Spring Nor'easters Case

Springfield Nor’easters

1. Mr. Buckingham’s challenge is to maximize Nor’easters’ profits while facing constraints such as limited and imperfect market research and financial constraints (break-even within one year).

1. He faces tradeoffs such as:

1. ticket price vs quantity sold
2. ticket price vs no show
3. selling more group tickets at a discount vs selling less individual tickets

1. The key findings from the survey are:

1. The willingness to pay of customers per price and per ticket type
2. The WTP of customers for concessions  (high WTP for tickets probably correlates with high WTP for concessions, yet lack of precision leads to use the average WTP for concessions across all customers type)
3. Potential opportunity: 38% of the city are baseball fans while only 28% attended a professional baseball game in the past year

1. Nor’Easters should use the following pricing structure:

*Requires further research. Calculations assume that a 3.9 price captures all the demand for “lower than $4” tickets.

1. According to the available data and performed calculations, the team would break-even and would realize a profit of about $ 200,000 (assuming a season is one year long and the absence of customers from nearby cities).

However, the market research suffers from both response and non-response biases (ex: likeliness to come attend a game might be overestimate and the

survey sample doesn’t take into account below poverty line inhabitants

1. Final thought: Mr. Buckingham should tackle the fact that the utilization rate of the stadium (# tickets sold under recommended pricing strategy / (38 games * 7,200 sitting capacity) ) would only reach 48%.