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The Price of Linsanity

2012 February 20
by Phil Miller

From Tom Van Riper at Forbes:

According to TiqIQ.com, which aggregates online ticket prices from various sources, the average price Knicks fans are paying online for a game at the Garden has shot to $313.54, up from $229.72 on February 3, the day before Lin’s improbable run began. The Knicks’ President’s Day matinee with the New Jersey Nets is going for $601.89, on average, 92% above the season average so far (though that season average is obviously growing as the season moves ahead with Lin as the headline act). The minimum price to get into the building for the Nets’ game: $149.

There’s more: for the Knick’s following home game against the Atlanta Hawks on February 22, the average online seller is getting over $750.  That’s about 300% more than a ticket was fetching less than two weeks ago. Sure, it’s New York.  But how many players would have turned mid-season dates with New Jersey and Atlanta into premium events?

I don’t follow the NBA closely, but I tuned into the Knicks game on Feb 7th after reading a bunch of tweets mentioning Jeremy Lin.   With the Linsanity storyline still going, it doesn’t surprise me to see the interest in Lin (would that make it Linterest?) reflected in the secondary ticket market.

Update (2/21/2012):  John Ourand of the Sports Business Journal had the following tweet this morning:

MSG rating factoid: last night’s Knicks game marked the 7th consecutive game-by-game increase on the NY RSN. Lin’s popularity keeps growing.

Bob correctly notes in the comments to the original post that the increase in secondary market ticket prices doesn’t necessarily mean that demand for Knicks games has increased because of Lin.   It may be a supply decrease that is causing prices to increase.

John’s tweets gives us a quantity demanded measure, albeit from a different (but related) market.  His second one I think can be safely assumed is at a constant “price” (0 at the margin assuming that the viewers of the NY RSN were already subscribers this season before Linsanity began).

6 Responses
  1. Bob permalink
    February 20, 2012

    I don’t see how this information can be used to conclude that Jeremy Lin has increased demand for Knicks games. There is no mention of the quantity of available tickets on the secondary market. How do I know that this isn’t simply a supply shock?

    Non-skeptic me would say that demand has increased, but it is unclear with the information given. I would guess supply is less and so a chunk of the price increase is due to that. Without quantities we will never know. And also, it appears TiqIQ.com is just looking at the average price of tickets available on the secondary market. This does not imply those tickets have been sold. So what are we really capturing?

  2. Duane permalink
    February 20, 2012

    Unfortunately the Knicks won’t be able the higher ticket prices since they have already sold these tickets at the regular price. If the Knicks sell out every game anyway, there is no advantage so they will have to wait for next season for any revenue benefit when ticket prices can be adjusted up, assuming they keep Lin for next season and that is not a given in the NBA.

  3. Manohar permalink
    February 20, 2012

    Although there will be limited benefit in ticket sales, there will be a significant benefit from people now showing up and spending money on concessions, Lin jerseys etc. Not to mention extra publicity reflected in higher advertising rates on MSG (definitely a factor in the recent agreement with Time Warner Cable) and potential playoff revenue for all of the above. Obviously all of this depends on how long Linsanity lasts, and as a long suffering Knicks fan I certainly hope that’s for the foreseeable future.

  4. February 21, 2012

    It is not possible that Lin can effect the ticket prices from the Knicks, because they have set prices for the entire season. He may help them sell-out more games, but that is something they don’t need much help with.

    Take the Milwaukee Bucks for example. Lin visits Milwaukee twice more this season. While Milwaukee averages 14k a game, their stadium can seat over 18k. If Lin sells out 2 games in Milwaukee, he will be the reason for 8k ticket sales. That is over a million dollars in unforseen revenue for the Milwaukee Bucks alone.

    Say what you want about the guy, but he is helping the world economy. His merchandise sales overseas alone are enough to match numbers that companies like Apple can put up. His ridiculous marketing power is coveted by the New York Knicks and whoever else decides do endorse him. Once the multiplier effect comes into play, this guy is making every NBA city richer, and everyone else in the world happier. #linning

  5. Phil permalink
    February 21, 2012

    We have to look at tickets sold in the primary market and the actual attendance to see any change in revenue.

    higher ticket prices also pushes out demand

  6. February 21, 2012

    Even more fun is taking a look at the price of MSG public offerings since Lin took over :-) (see below):

    http://www.dailyfinance.com/quote/nasdaq/madison-square-garden/msg

    Quite a jump since he came to the front of things. So, if there’s not increased demand, there seems to at least be speculation that MSG could see some serious return from his play.

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