Sorry to hear about losing your seats. I also believe that the reason for limiting the upper bowl is to get concentrated audiences in the lower bowl for television broadcasting. Casual observers that see a packed section of spectators when the TV pans the stadium are significantly more likely to become fans than if they see half filled (or often 10% filled) stands. It shows very very poorly on TV. With all of the comparisons to Minor League Baseball, we don't even look that successful on TV many times. Step 1 is packing stadia so that it looks like there is a buzz of excitement rather than pathetic apathy on TV. Step 2 is selling out and creating demand for season tickets and advance purchases. These generate revenue even when it rains. Right now, our large walk-up crowd is very small when it rains. Step 3 is creating a demand for TV audiences. If you cannot get a ticket to the game, you'll be louder in your request for our cable companies to carry games. TV is the real avenue to new fans, as they're much more likely to watch a minute as they channel surf than waiting for someone to physically take them to the game to find out whether they like it. Step 4 is expansion into major TV markets so that MLS' TV footprint is larger. This helps considerably when attempting to get national coverage. Step 5 is profitability. In an ideal world this would be step 1, but realistically the other four things really need to be in place to attract the Owner/Investor/Operator ("I/O") ahead of funding for stadia. Hang in there, MLS is simply trying to grow the sport. We'll all live through the growing pains. -Tron
Guys, this really has nothing to do with the 20K vs. 25K or whatever. It has to do with making a 8K crowd look like a 10K crowd and sell like a 12K crowd. When the game generates significantly more than 25K they'll probably start opening up the upper bowl. They don't want to lose the revenue, they just want to be able to say "sold out" because everybody gets interested in something once it's sold out. Casual TV fans are a major growth area for MLS. -Tron
I don't why everyone seems to be so "surprised" by this cost cutting measure. United's attendance is off by close to 5,000 per game (not including, what do you call them ah, yes, playoff games). I would estimate that translates to over a 1 million dollars (5,000fans*14games*$15) and represents a significant loss of revenue. Given that there are plenty of seats unused in the lower bowl, I can't blame United for closing off the upper deck. 2002 was a disaster both off the field as well as on. RFK may be a great stadium to watch a game, but from a business standpoint its terrible, eclipsed only by the mess called Giant's stadium.
Unfortunately, it costs whatever the stadium authority says it costs. I'd bet there's a minimum rental fee, or overhead, the SA charges for opening the upper deck, even when they know they won't need to supply a proportionately sized staff. Larger crowds, like those at double headers, may justify the extra fee.
I really don't think it costs that much more to open up the upper deck. 1 concession stand -- 2 workers @ $10 hour x 3 hours= $60 12 sections -- so at most 14 ushers@$10 hour x3 hours = $420 4 Security guards @ $10 hour x 3 hours = $120 2 Cleanup people @ $10 hour x 1 hour = $20 So total cost per game = $620 You don't have to sell that many chicken fingers $9 or Budweisers at $6.50 to make that back up. The average ticket price there is $24. (1 VIP @$28 + 2 Premium @$22) I dare say there are more than 26 people sitting up there to cover the expense. If DC United tries to say that closing off the 400 level is about money, then they are full of it. It is definately about packing the lower bowl. This should bring the "soccer capacity" of RFK down to around 20-21,000. Attempting to create a little more artificial demand for tickets.
What about the fixed cost of opening the upper bowl? Just to open it must incur some fixed cost upward of $2000. I doubt DCU sells enough tickets to make it worth opening it up. Sachin
well, i think that by closing the upper deck, they are also testing. if they build a SSS, its gonna be single deck, tat and it saves em money.. just openign it for big games like the ALL-STAR game and playoffs
What "fixed costs"? There has to be something there to cost money... and all there is is labor costs. The stadium is open, all the costs come from staffing it... concessions, security and users... that's it. It doesn't cost any more electricity to have the 400 level open.
I suspect the new lease has something to do with the decision to close the upper deck. It may be the lease cost is less with the upper deck closed, and DC's management decided they'd try to keep as many of the upper deck patrons in the mezzanine at VIP prices, thinking they'd see no decline in revenues while reducing their rental costs. That's the only way it makes sense from a business perspective. If the lease expense is the same with or without the upper deck open, then they're just alienting their long-time customers for no good reason.
Late to the party as usual but I wanted to chime in briefly. I appreciate that most of you have understood our decision to close the upper deck and I apologize again to those of you getting displaced. This was not an easy decision to make. The truth is that we should have never opened those seats to begin with. The lower bowl plus Mezzanine should have been capacity since day one. Believe me it will be very hard for us to turn away sales on days that we "sell out" in the future but that is the mentality that we have to put out there. Most of you understand the concept and may agree or disagree about it. I would be happy to speak to anyone who would like to discuss it further but it would take me too long to do it in this forum. Call me if you have questions or concerns. To those of you who are being displaced, we are very sorry for the inconvenience. If there is something we can do for you other than what has been offered, please do not hesitate to call. Stephen
Well, I don't know about TV visuals. They sell the side that isn't seen on television first and the side that is seen on television last. So, the side not seen on television is usually more full than the other side until the whole bottom bowl fills up. I think that a concession stand and the 20 yellow shirts that they have upstairs probably don't cost that much. But, maybe the new agreement knocks a little bit off the rent for closing the upper deck.
Your offer of a telephone conversation is wonderful; however, in the interest of saving you valuable time so that it can be devoted to successfully managing the club, why not post the full economic rationale on the web site and put a link here?? GM
I'm sure your numbers are very accurate. However, I'm also sure that DC United is charged much more. While is may only cost the Stadium Authority $50 per game to keep the upper deck open, I'm sure they pass the savings on to the customer and that it costs DC no less than $5,000 in rent per game to keep the upper deck open.
In New England they have seating only on one side of the lower bowl. In the new Soldier Field they plan to only have lower bowl seating. Colorado the same (and I think KC as well). The league want to drive up ticket demand and season ticket demand. After the big decline in attendance this year (even with bringing in Q2-who was supposed to draw El Salvadoran fans back). So I can't see how we can hold this against them. They're trying to make the business of soccer viable in the US. Seems like sitting closer to the action shouldn't be a huge sacrafice.
I don't understand how this works. How do they up demand? Are you suggesting that they can do this by limiting supply? If so (and if that made sense), are you suggesting they decline selling unused seats and turn people away at the box office? Or are you suggesting they just put people in seats they like less? Either way, I don't see how it helps demand.
It artificially inflates demand by limiting supply. If people think there is a chance a game might sell out, they marketing gurus believe that will lead people to buy season tickets. Or at least buy tickets in advance. Appearantly teams would rather turn away fans at the gate and give a sense of "ticket scarcity" than profit the extra money from letting more people in.
As introductory economics would teach anyone, decreasing supply does not shift demand up. It can, though, raise the equilibrium price. If that is what MLS is doing it's foolish and short-sighted.
One of my earlier posts pointed out that DCU has given upper deck fans a choice of mezzanine tickets at the VIP price (i.e., upper deck VIP customers can purchase the higher cost mezzanine tickets for the same VIP price, and Premium ticket upper deck customers can pay the higher VIP price for mezzanine tickets). This means for $396/seat, you can buy (at least for next season) a seat in the mezzanine that usually gets $486/seat. The other alternative, if you want to keep season tickets, is to buy a seat in the lower deck where only eight out of more than 100 sections charge the VIP price. Basically, the chances are that closing the upper deck will be revenue neutral or result in a loss of revenues compared to the existing arrangment. DC is eliminating 1/3 of the VIP (nearly the most expensive) seats. If I renew my seats, it's likely to be fewer in number and at a lower price, so restricting supply, which in my view is just restricting choice, is going to lose money in my case. For a team that has missed the play offs for three straight years and only sells out its lower bowl for world cup qualifiers, and a team that plays at a gargantuan stadium where, even if further "downsized", anyone can come on game day, pay for the cheapest seat, and sit anywhere they please, I consider the strategizing about closing the upper deck to create demand a somewhat attenuated what if game. I'm sure DC's management has its reasons for closing the upper deck, though Zack's e-mail dodges that issue. That doesn't mean I have to like the result, or that I have to agree with those reasons when I hear them. I wonder if DCU ever considered making the upper deck available only to season ticket holders? Now that would force people who want that service to commit to season tickets (like I have for seven years). That way, those who want the higher up perspective would get what they want, and DC would be forcing those people on the fence to choose season tickets if they want that location. Rather than viewing the stadium as a whole and trying to boost demand by decreasing supply (which I agree, in economic theory won't affect supply; rather, the relative scarcity should make people willing to pay more), how about viewing the upper deck as a submarket; restrict that supply to those who are willing to buy it for th entire season (which is tantamount to increasing the price due to scarcity of supply).
One of the things that has not been pointed out regarding our restructuring is that we are re-pricing two of our lower bowl Premium Sections to VIP pricing. Those planholders have also received letters and have been given early bird renewal options. Again, to anyone who would like to speak to me further about the decision to close the upper deck, please do not hesitate to call. Stephen
I know some of you are disappointed at losing your seats - but try and be rational here. Stephen Zach is not employed by Uncle Phil to run a charity. He is here to run a business and it is his ass on the line to make it profitable. So why some of you think that DC has not analyzed all possible scenarios is beyond me. Now, Stephen has appeared here twice and said if you have a problem to call him and he will discuss it with you. From what I am hearing they are making a great effort to keep you all as season ticket holders. As for the idea of only season ticket holders sitting in the upper deck - this does nothing to lower the costs and only decreases the revenue coming from this section of the stadium. This is going to cause DC to lose more money.
These seats are $396 each for the season. How do you figure it would be losing money? Neither of us know how many actual season ticket holders are being displaced (other than the 3 or 4 that have spoke up here). IF there were 200 season tickets sold up there, that's almost $80,000 in revenue. Move those people down a ticket level and DC loses around $14,000. (Almost enough to pay Brian Namoff!). But... this is not about revenue, its about creating a ticket scarcity. Its what NE has tried to do, its what Chicago is doing, its what Colorado is doing. All the teams that play in big stadiums are all downsizing to a lower bowl and putting a cap on tickets. MLS has made the decision that the opportunity cost in turning away fans to make them buy tickets sooner for the next game outweighs just selling as many tickets as they can for each game. Its a decision, we have to live with it, but DC United is going to lose $144 from me personally cause I'm not going to pay for Premium in the lower bowl, I'll buy VIP.
After my experience in the upper deck late this past season, I agree that it will be a shame to lose those sight lines. That was the true redeeming quality of the seats. However, that was the only redeeming quality. I gather that there must be something that I am missing...as I'm trying like hell to figure out what is so great about the seats except the view. I've got nothing. Personally, that was the loneliest United gamed I've ever been to up there. After half it was all my wife could do to keep me from running down that interminable spiral of ramps to get back to civilization (and the foggy bottom). So, if any of you all are desperate for ideas next year, sections 310 (or thereabouts) have great access to Foggy Bottom and Red Hook (20 oz for 5.50...what's not to like?) and spectacular views (almost as good as the 400 levels.). Then again, there is always the rowdy side, which is much preferable to me. Cheers, Tim
Which, by the way, makes for an awful atmosphere, in my opinion (I went to the first of our two away games there this season). There's nothing that makes a game seem more exciting than having a completely empty stadium as the backdrop to the play on the field. There may be 10 or 15 thousand people there with you, but you can't see any of 'em and, as they are quiet New England fans in a stadium that doesn't catch any sound, you can't hear 'em either. Well, at least the seats (you have actual seats) and beer are better there than at Foxboro Stadium. Mark
I think it's being done on conjunction with the Freedom, at least in terms of making seat prices relatively (except for the Freedom Fighters) the same for the two teams, for the same locations. Don't laugh. Now that there is no '02 Olympics, you get the feeling a United Park is in the offing. They can build one quicker than you can say DC General. I don't buy it. It hasn't happened yet, and it is impossible to engineer the move of an entire franchise in five months. And if it does, it will make the Williams re-election petition drive look like a well-oiled machine.