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10/07/2024

The Hidden Cost of Season Tickets

Season tickets provide secure revenues for clubs. But they come at a price that could undermine the overall stadium experience.

Dominik Schreyer - October 7, 2024

High season ticket sales are often seen as a clear success story for football clubs. And the more tickets that are sold, the more both the media and football clubs alike have reason to celebrate. The record numbers that certain clubs achieve are hailed as a testament to fan loyalty and the unwavering demand for live matches.

But is more always better? 

The allure of season tickets: stability and loyalty

Season tickets are widely viewed as a cornerstone of football’s financial health. For clubs, they offer stable source of revenue, and they help alleviate the burden of selling individual tickets for each match. And the financial certainty these tickets bring also allows clubs to plan, budget, and make investments with greater confidence. From a fan perspective, they are a symbol of their own commitment to the sport. They represent the promise of being a part of every moment and are a way to maintain a strong connection to their team.

The hidden costs: reduced margins and empty seats

While season tickets do provide guaranteed income, there’s a lot more lurking beneath the surface. These tickets, when compared to single-match tickets, are often sold at a substantial discount, which lowers overall revenue. This becomes particularly problematic when clubs experience high demand for high-profile matches, as a large portion of seats will have already been sold at reduced prices. And that prevents clubs from capitalizing on premium pricing.

And that is not all. In fact, a high proportion of season ticket holders leads to another issue: increased no-show rates. Many season ticket holders miss three to four home games per season. Though the club keeps the ticket revenue, the empty seats still come at a cost. Full crowds provide an atmosphere that is crucial for the live experience, and vacant seats detract from that. And low stadium energy can potentially impact television viewership, sponsors, and even future ticket sales. Clubs like Bayern Munich or Borussia Dortmund, which could easily resell those empty seats due to high demand, lose that opportunity when absent season ticket holders keep the seats locked.

Logistical inefficiencies also arise. Clubs must staff their venues and prepare food and beverage services under the presumption that the stadium will be full—even if a portion of the crowd might not show. This waste of resources, combined with the visual impact of empty seats, can harm the club’s reputation and reduce the perceived scarcity of tickets, further diminishing interest among potential buyers.

The future challenge of an aging fan base

Another subtle yet significant issue lies in the aging demographics of season ticket holders, who, over time, tend to hold onto their spots, thereby creating a “closed club” effect at season ticket-heavy clubs in strong demand. As these fans age, clubs face the challenge of reaching younger, more energetic audiences. Without a steady influx of new fans, stadiums—which should be dynamic hubs of excitement—risk losing their vibrancy and becoming quieter, more static venues. This gradual aging of the fanbase may eventually affect the game-day atmosphere, which is key to keeping the sport lively and engaging for both in-person and remote audiences.

So what should clubs do?

While record season ticket sales may seem like an easy win, clubs must carefully weigh the hidden costs. Reduced profit margins, higher no-show rates, and an aging fan base could undermine the long-term success and vibrancy of the sport. Striking the right balance between financial security and maintaining a dynamic, engaged stadium environment will be essential for clubs moving forward. 

On a broader scale, enhancing the matchday experience—i.e., to make even the idea of missing a game unimaginable for fans—may be crucial. But where this is not possible, one approach to solving this conundrum could be to reduce the number of season tickets distributed to fans. Another could be to encourage season ticket holders to resell their tickets through an official resale platform if they are unable to attend, potentially by introducing a minimum usage policy—a strategy that has gained popularity in the industry. However, this assumes that demand for seats exceeds supply, which is not always the case. 

Literature reference

Article loosely based on the following study:

- McDonald, H./Dunn, S./Schreyer, D./Sharp, B. (2023): Understanding consumer behaviour in evolving subscription markets – lessons from sports season tickets  research. Journal of Service Management, 35(1), 89-107. DOI: 10.1108/JOSM-03-2022-0116

Co-author of the study

Apl. Professor Dominik Schreyer

Dominik Schreyer is an apl. Professor of Sports Economics at WHU – Otto Beisheim School of Management in Düsseldorf, Germany, and co-director of its Center for Sports and Management (CSM). In his research, Professor Schreyer explores the role of sociopsychological factors in individual economic behavior and decision-making through the lens of professional sports. In particular, he is keenly interested in analyzing sports demand (e.g., football spectator no-show behavior). He has published over 40 articles in international peer-reviewed journals, including Economic Inquiry, European Sport Management Quarterly, Games and Economic Behavior, Technological Forecasting & Social Change, and Journal of Vocational Behavior.

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