Looking at the bigger picture and the dollars of the Caps continued season ticket price increases
The Caps announced season ticket prices for next season and for many customers this means an increase for the fifth straight year.
Owner Ted Leonsis noted in a message to plan holders: “Most of you will see a change, an average increase of about 8%. Some seat prices have changed more than others, while some have stayed the same and a few seating areas actually have decreased in price. I realize no one wants to pay more, but our season-ticket pricing has been moderate when compared with others around the league.”
An average increase of 8% one year might not sound like a lot. But increases year-over-year work like compound interest and this one combined with those of the past four years has resulted in a dramatic increase in the total cost to plan holders for their Caps tickets. As an example, I was chatting with my father about the price of his 400 level seats over the past five years and here’s the total cost for his two seats by year, which are going up 12.5% for next season:
So, in five years, the cost of his season tickets has almost doubled, increasing by 90.7% in going up $1553, from $1713 in 2008-09 to $3266 for next season. During this span, the Caps have been incredibly exciting to watch the majority of the time and have become the hottest ticket in D.C. But, the team has not advanced past the second round of the playoffs during this time and each of their post-season exits has featured some rather uninspiring play. Not since the 2007-08 playoff loss in seven games to the Flyers has it appeared as if the team left it all out on the ice as they were eliminated. In series losses to Pittsburgh (’08-’09), Montreal (’09-’10) and Tampa Bay (’10-’11), the team looked flat and unable to push over the hump to take their post-season game to the next level.
For team management, the justification for constant price increases is likely more about demand and Caps season ticket holder data than how each season has ended. A waiting list for season tickets, a sell out streak that dates back multiple seasons now and a “slightly better than 98%” renewal rate last season signals the Caps can get away with pushing prices upward every year. Looking at it this way, what the Caps are doing makes sense—they’re striking while they can and taking in dollars that their data is telling them are there to be grabbed.
However, after price increases for so many seasons in a row and large ones the past two years, a current team that would not make the playoffs if the season ended today, and signs that the resale market for Caps tickets might be softening, it would have been a good PR move for the Caps to give their loyal customers a break this year. But the truth is, for any plan holder they lose, the Caps likely have someone waiting to take their place right now.
This aggressive approach the Caps front office is taking with ticket prices appears to be working for them currently, but it has some potential to backfire long term if enough fans are left with a bad taste in their mouth from the constant increases and the team hits a rough patch, missing the playoffs for a year or two, or continuing to disappoint when they make it.
Meanwhile, up the road in Baltimore, the Ravens announced they will not raise ticket prices FOR THE THIRD STRAIGHT YEAR. This is a team that was potentially one dropped pass (or bad call, depending on how you look at it) away from going to the Super Bowl this season. On their decision to leave prices alone again, Ravens President Dick Cass said, “We know that our fans are continuing to be stretched financially to pay for season tickets. While the economy is improving, it’s still not strong.”
Here in D.C., the Caps continue to push it with their price increases, pouncing on the chances before them to drive their revenues upward. If the team on the ice attacked their opportunities each spring in the same manner, this might be easier to accept.
- Striking while the iron is frozen, Sens launch season-ticket campaign (prohockeytalk.nbcsports.com)
- How to see a Washington Capitals game without spending a ton (brookslaichyear.com)
- Eagles Will Not Raise Ticket Prices In 2012 (philadelphia.cbslocal.com)
- Packers raise prices between $3-$5 per ticket (espn.go.com)
- The Cavaliers Capitalized Off Of LeBron For An Entire Year After He Left, But Are Now Feeling The Sting (businessinsider.com)