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Consumer Forwards: Concept and Empirical Analysis of a Sports Ticket Market

Author

Listed:
  • Preethika Sainam

    (Arizona State University)

  • Sridhar Balasubramanian

    (University of North Carolina at Chapel Hill)

  • Barry L. Bayus

    (University of North Carolina at Chapel Hill)

Abstract

Tickets to sports events like the NCAA basketball tournament are currently sold well in advance of the games. Fans who wait to purchase a ticket after knowing which teams will play are often disappointed because the tickets are sold out by then. Recently, some firms have offered fans the opportunity to purchase forwards on tickets before this uncertainty is resolved. Each purchased forward is linked to a team – if that team makes it, the fan must buy the ticket; otherwise, the forward expires. Such forwards protect fans from uncertainty and provide the firm with assured revenues. This paper presents an analysis of data from a company that offers forwards in a sports ticket market. Multiple models that account for fan heterogeneity are presented to capture forward purchase and resale behaviors. The analysis and findings shed light on how fans mitigate risk in this volatile setting and lay a foundation for future work on consumer forwards.

Suggested Citation

  • Preethika Sainam & Sridhar Balasubramanian & Barry L. Bayus, 2015. "Consumer Forwards: Concept and Empirical Analysis of a Sports Ticket Market," International Journal of Sport Finance, Fitness Information Technology, vol. 10(2), pages 103-121, May.
    • Handle: RePEc:jsf:intjsf:v:10:y:2015:i:2:p:103-121
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    More about this item

    Keywords

    forward pricing; pricing under uncertainty; event tickets; Final Four tickets; consumer forward;
    All these keywords.

    JEL classification:

    • L83 - Industrial Organization - - Industry Studies: Services - - - Sports; Gambling; Restaurants; Recreation; Tourism

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