Springfield Nor'easters Case

In the Springfield Nor'easters case study, the management for a minor league baseball team is trying to decide on the most effective ticket pricing strategy to draw the largest crowds possible to the baseball games. The team will have two major funding sources: the sale of tickets and proceeds from concession stand sales. This case study will look at why the owners choose Springfield as a location for the team, the marketing research that was conducted to determine the types of people who would attend the games and what type of pricing they could afford. This case study will present the options that the team has when considering the pricing of their tickets and will take into consideration the data gathered from the survey. The primary goal of minor league teams is to offset the costs of running a team that are not covered by the affiliated major league team, Nor'easters owner Jimmy Mercante has to make the team self-sufficient so they can make the money necessary to cover the cost that are not covered by the major league affiliate team.

A survey was sent a survey out to a sampling of the residents of Springfield to aid in determining the adequate pricing for the ticket the team but received only 625 responses from the survey of the thousands that were sent out so we must question the integrity of the survey results. Did we get an adequate sample response; can 625 responses speak for the 55,328 residents of Springfield?

The minor league baseball team the Springfield Nor'easters is getting ready for their first baseball season. The business objective of the team's owner is to make a profit as any other business would. To cover the cost for the team the Marketing Director Larry Buckingham is trying to determine the correct amount to charge for tickets because ticket sales and concession stand monies are the two primary sources of income the team will have. Buckingham has to find a balance where patrons will purchase tickets and still have money left to spend in the concession stands so that both main revenue streams for the team are covered. There are many social and economic factors that will play into the decision of the pricing strategy: the economic issues in the small town, the family income, the age and interests of the residents of Springfield. The Nor'easter's owner Jimmy Mercante wants to break even the first year with revenues and expenses. A marketing survey was conducted to determine what the residents of Springfield are comfortable in paying for tickets.

The survey was conducted to collect information to be able to make an informed decision on the pricing strategy for the team. The survey questions provided us an inside look into the residents of Springfield and show us that 38% of residents consider themselves baseball fans, 28% have attended a baseball game of some type. When we analyze the survey results we find that the potential customers may not be baseball fans they may just be looking for entertainment. The average households have an annual income of between $22,500 and $75,000. 39% of those returning surveys admitted they would attend one or more games per year. The survey also shows that 31% of patrons are willing to pay $10 to $14 for a single ticket when questioned about pricing. Patrons responded that they expect discounts for season or multi-game tickets and the survey shows that multi-game packages of 5 tickets would sell for $10 per ticket at a 36% discount. A 38 game season ticket would sell for the discounted rate of $4 per ticket and half season tickets when purchased together would sell for $8 per ticket. The survey also showed us that 8% of patrons would spend nothing in the concession stands, but most would spend somewhere between $6 and $15 dollars on the concession stands. We must also consider the national research done a few years prior which showed that Springfield residents were not know for attending professional sporting events. The 2005 survey stated only 8% of those surveyed had ever attended a professional baseball game in the past year. Those that have not attended a game in the past may not realize the length of the game and most will likely purchase at least a drink. The 2005 research also showed that the most popular sports in a college town are football and basketball so college student turnout for a baseball game is low when compared to the other sports.

We have to take into consideration the number of surveys returned. With a response of only 625 out of the 10,000 sent can we consider this small amount a valid survey? It would be in the best interest of the team to remember the information came from such a small sample that they would need to factor in a margin of error when considering the information gained from the survey.

Using the SWOT analysis we will look at the strengths, weakness, objectives and threats facing the Nor'easters team. The strengths for the Springfield Nor'easters is that they have a marketing director that has done his research with the survey as well as the previous research so an informed decision can be made, they are a minor league team that often is the training grounds for future major league stars, when you consider the prices of major league teams and the drive to get there a minor league team in your own hometown can give you the experience of a professional sporting event without all the expense.

The major weakness facing the Nor'easters is that fact that they are a minor league team in a city surrounded by major league events. They have no established fan based because there a new team, there trying to establish themselves as a team in a market that has already established college teams, they have an inexperienced market director and there survey results are limited due to the number of responses. For a team that is dependent on the concession stand proceeds to supplement the ticket sales they only one have one beer stand if they are planning on selling a large amount of beer they would need a beer stand for each concession stand otherwise they are going to have long lines if they succeed with the ticket sales and that may frustrate some patrons.

The opportunities' facing the Springfield Nor'easters is that they can bring a new type of entertainment with the minor league team to a town that has not had a lot to cheer about. With the new business in town the economy is starting to rise and the Nor'easters need to take advantage of that by giving the residents of Springfield a new team to support and cheer on. The majority of homes in the Springfield area have children under the age of 18 so there is a major opportunity for the Nor'easters to have an association with the schools in the area and if you get the children interested in the minor league team you can get the parents interested in the team as well boosting ticket sales.

The threats