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The Rebrand of the Utah Jazz’s Upper Bowl Fan

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How a simple price increase could significantly change the makeup of the usual Upper Bowl fan at Vivint Smart Home Arena

Back in 2016, the Utah Jazz went through a major rebrand on the court. They redesigned their main font, they went back full-time the Note, updated the main court, and updated their color scheme to the base blue, green, gold, and white that we know now. Most of the time, that is what what people associate with a rebrand: the outward appearance. That’s what people associate with an update. But a rebrand is a lot more than just a new building, new kicks and clothes, and a modern logo. Rebrands usually have one major goal in mind: marketing to a new customer or segment in order to increase revenues.

You might see where I’m going with this.

Today the Utah Jazz announced price increases that affected almost all of their season ticket holders. Season ticket holders in the lower bowl are very familiar with price increases as they recently experienced a price increase in 2017 as many felt the pain of a 6-7% while some saw the price tag jump up as much as 38%. That was their sticker shock. Much of the upper bowl—the people’s seats—didn’t see significant price jumps. That is until today when some season ticket holders experienced price increases as high as 150%.

While new colors, new threads, new digs, and new paint are really fun for a rebrand, there are the unfortunate sides to a rebrand. Some consumers get left behind. A rebrand is to bring excitement into a lackluster brand and bring in new customers or segments in order to, you guessed it, make more money. It’s as true for Apple as it is for the Utah Jazz.

If you’re saying to yourself, “This is ridiculous, they’ll realize this is a bad decision” ... think again. They unleashed their price adjustments in 2017 and they were rewarded the following year by record season ticket sales. Fans fresh off the euphoria of Utah’s improbable comeback season paid the new premium to see their re-energized team. Utah sold out of season tickets last year. Just look at these quotes (italics added) by Utah’s VP of Marketing Bart Sharp and VP of Ticket Sales Chris Barney last March to the Salt Lake Tribune during the hysteria:

“Our fans are very engaged with our brand. We can’t seem to give them enough. ... I think [fans] feel connected to the team in the way they haven’t felt in a long time. In our marketing, we’re trying to focus less on pricing, and more on telling a basketball story.”

- Bart Sharp citing data that the Jazz have collected in focus groups held before every game

“You’re giving up beachfront property for the prime years of Rudy Gobert’s career, and the early seasons of a budding superstar. People are grasping onto the hope of really what our front office is going to do, and what we’re building towards. And the fans can feel it.”

- Chris Barney speaking on his pitch to current Season Ticket holders

This price increase may have struck a nerve this year, however. While the 2017 Season Ticket increases were announced at the same time Utah had a playoff team and Gordon Hayward’s exit from Utah was still a month away, this current increase didn’t have the benefit of a Utah Jazz team on the up and up. The Utah Jazz are currently two games under .500 in a crowded Western Conference. When playing at home, the Jazz tend to send their fans home disappointed 50% of the time as they are only 8-8 at home.

Then there is the nature of the price increase. While past increases saw the price of tickets go up by 5-6% and in rare cases 38%, this one took it to another level.

Utah Jazz Season Ticket Price Increase

Price Level Full Season Grand Total Per Seat BEFORE Full Season Grand Total Per Seat AFTER Avg Per Seat BEFORE Avg Per Seat AFTER Increase
Price Level Full Season Grand Total Per Seat BEFORE Full Season Grand Total Per Seat AFTER Avg Per Seat BEFORE Avg Per Seat AFTER Increase
A 7920 8404 180 191 6.11%
B 7700 8184 175 186 6.29%
C 7260 7612 165 173 4.85%
D 6820 7172 155 163 5.16%
E 6380 6820 145 155 6.90%
F 5060 5412 115 123 6.96%
G 3960 4180 90 95 5.56%
H 3300 3476 75 79 5.33%
I 2860 2992 65 68 4.62%
J 2200 2332 50 53 6.00%
L 2200 2200 50 50 0
M 1628 2200 37 50 35.14%
N 1496 2200 34 50 47.06%
O 1188 1584 27 36 33.33%
P 792 1320 18 30 66.67%
Q 525 1320 12 30 150.00%
R 264 660 6 15 150.00%

Lower bowl fans experienced a very similar increase as the one in 2017, some upper bowl season ticket holders found themselves staring at 150% increases. Some of these prices increases were due to Utah bottoming out their prices to keep butts in the seats during their 2004 tank year. That didn’t stop many current season ticket holders from going to twitter to complain. Many said they simply would be financially unable to renew. Many cited that if it was a price increase of 10%-20%, they could find a way, but that 33% or more was too much.

Which brings us back to rebranding. A rebrand is intended to go after new customers. In the process of going after new customers, existing customers may either be priced out, not marketed to, or forgotten.

A prime example of this was the failed rebrand of JCPenney a few years ago. They abandoned a lot of the deals, coupons, and sales that endeared them to their long-time customers and focused on segmenting the store into brands like mini-stores within the store (think of Sephora). JCPenney was aiming for a more affluent and younger customer. Their customer base was older and, to be frank, dying out. It didn’t work, though. The changes were too much, too quick and it led to the demise of the CEO as much of the long-time customers of JCPenney felt like the business turned their back on them when they had continued to patronize their store even in the bad times.

A rebrand can backfire if done too quickly or—in JCPenney’s case—you abandon the customers who got you there completely. How does this apply to the Utah Jazz?

Let’s look at the price increases in a different way. To do so, we need to evaluate the Utah Jazz’s response to the uproar over the ticket prices. Beneath the corporate PR jargon to quiet the masses there’s some good pieces we can extract. Eric Woodyard of the Deseret News was one of the media invited to the call with the Utah Jazz Marketing as they explained the reasoning. Here’s some of the highlights:

The Jazz, who spent $12 million on that renovation, offered multiple reasons for the changes.

For one thing, the franchise decided that it was no longer feasible to continue allowing 190 accounts to only pay $6 per seat. That was the cheapest price in the NBA and had been in place since a $5 promotional ticket price based on the No. 5 pick in the draft in 2014.

The Utah organization also claimed it’s trying to curb gouging on the secondary market by better regulating the price of all tickets. Though the Jazz don’t have access to what happens to all tickets once they’re purchased, they receive extensive data from Ticketmaster if fans resell tickets through the team’s ticketing partner. Data reveals that the $6 seats are being resold for an average of $16 for the lower-tiered games and for $54 on the high-demand games.

In theory, this means the Jazz will get the price difference upfront instead of season-ticket holders through the secondary market on a game-by-game basis.

...

The league advised the Jazz to streamline ticketing prices, according to Chris Barney, senior vice president of ticketing and premium seating, so they scaled down from seven price points in the upper bowl to four.

Rebranding’s purposes is to obtain the money that businesses are leaving on the table. This price restructure is about that. They’re seeing all that money in the secondary market and salivating. Why sell these tickets for $6 and see your secondary seller make all of the money? Jazz fans, or in some cases predatory re-sellers, are purchasing these season tickets and flipping them at single game prices that are more expensive than the tickets you can buy direct from the Jazz. That limits the market. I can see their point. Jazz operations wants more actual fans there and doesn’t want actual fans kept out of their own product. It’s a real issue. But there’s no guarantee that raising the price by this amount is going to significantly prevent that.

In a story by CBC journalists in September of 2018, TicketMaster was shown to have actively worked against the ticket buying consumer it says to protect:

“I have brokers that have literally a couple of hundred accounts,” one sales representative said. “It’s not something that we look at or report.”

Casey Klein, Ticketmaster Resale director, held a session that was closed to the media called “We appreciate your partnership: More brokers are listing with Ticketmaster than ever before.”

The audience heard that Ticketmaster has developed a professional reseller program and within the past year launched TradeDesk, a web-based inventory management system for scalpers. The company touts it as “The most powerful ticket sales tool. Ever.”

“If you want to get a good show and the ticket limit is six or eight … you’re not going to make a living on six or eight tickets,” he said.

“We don’t share reports, we don’t share names, we don’t share account information with the primary site. Period,” he said when asked whether he cares if scalpers use bots to buy their tickets.

CBC heard the same message from a different Ticketmaster employee during an online video conference demonstration of TradeDesk at an earlier stage of the undercover investigation back in March.

“We’ve spent millions of dollars on this tool. The last thing we’d want to do is get brokers caught up to where they can’t sell inventory with us,” he said when asked whether Ticketmaster will ban scalpers who thwart ticket-buying limits — a direct violation of the company’s terms of use.

“We’re not trying to build a better mousetrap.”

It seems like the current re-seller system is always going to promote re-selling and bots will continue to be out there getting tickets. What’s to prevent Utah’s ticketing staff from selling to the same guy if it means they sell 15 season tickets? Those salesman are looking for commission checks just like Ticketmaster’s are. Chris Barney, SVP of Utah’s ticketing, had this to say about preventing price gouging:

While the thought is earnest, there’ll always be people who re-sell. You can raise the prices but you run the risk of raising the waters for all tickets and pricing out the consumers you are trying to protect. By giving tough love to your kid at home, you don’t prevent him from getting bullied. You could just be redirecting where he gets pushed around not if he gets pushed around.

One of the explanations from the Utah Jazz’s call to media was citing that the Jazz decided that it wasn’t feasible to keep 190 accounts only paying $6 a seat. While it’s easy to be like, “Wow, that’s unfeasible.” For all those 190 accounts they’re talking about, at 2 seats per account you’re looking at 380 seats, only half of the Jazz’s old tan seating in the nosebleeds. How would I know that?

*cracks knuckles*

Because I counted the upper bowl seats (might be off by a +/-10 total in each color code section). Here’s the numbers on that.

Estimated Additional Revenue Generated by Price Increase - Upper Bowl

Price Level Full Season Grand Total Per Seat BEFORE Full Season Grand Total Per Seat AFTER Avg Per Seat BEFORE Avg Per Seat AFTER Increase # of Seats Additional Revenue Generated Old Section New Section Low High Average Markup from Season Ticket New Single Ticket Price Additional Revenue From Single Game Tickets if 50% Additional Revenue From Season Ticket Holders if 50% TOTAL OF BOTH
Price Level Full Season Grand Total Per Seat BEFORE Full Season Grand Total Per Seat AFTER Avg Per Seat BEFORE Avg Per Seat AFTER Increase # of Seats Additional Revenue Generated Old Section New Section Low High Average Markup from Season Ticket New Single Ticket Price Additional Revenue From Single Game Tickets if 50% Additional Revenue From Season Ticket Holders if 50% TOTAL OF BOTH
L 2200 2200 50 50 0 256 $0.00 Gray Aqua 77 138 107.5 215.00% $107.50 $0.00 $281,600.00 $281,600.00
M 1628 2200 37 50 35.14% 474 $271,128.00 Aqua Aqua 52 99 75.5 204.05% $102.03 $257,763.12 $521,400.00 $779,163.12
N 1496 2200 34 50 47.06% 224 $157,696.00 Green Aqua 46 102 74 217.65% $108.82 $159,909.65 $246,400.00 $406,309.65
O 1188 1584 27 36 33.33% 988 $391,248.00 Gold Gold 38 70 54 200.00% $72.00 $364,572.00 $782,496.00 $1,147,068.00
P 792 1320 18 30 66.67% 1642 $866,976.00 Teal Teal 25 57 41 227.78% $68.33 $920,067.33 $1,083,720.00 $2,003,787.33
Q 525 1320 12 30 150.00% 4444 $3,532,980.00 Red Teal 23 44 33.5 279.17% $83.75 $4,577,875.50 $2,933,040.00 $7,510,915.50
R 264 660 6 15 150.00% 817 $323,532.00 Tan Red 17 40 28.5 475.00% $71.25 $715,998.38 $269,610.00 $985,608.38
TOTAL 8845 $5,543,560.00 GRAND TOTAL $13,114,451.98

What the Utah Jazz’s SVP of Marketing is saying is they like the estimated $269,610 they can earn by the price increase in those seats. That’s the salary of 3.5 two way players. But there’s more to that. Say your core season ticket holder of your cheapest available season tickets is the working poor or a college student, that severely limits the amount of add-ons they purchase throughout the year. They probably will find ways to circumvent team sponsored parking, they’ll avoid concessions and only hit drinking fountains, forego merchandise purchasing, and evade other additional revenue generating add-ons offered by the Utah Jazz. It’s not just the $269,610 additional dollars that Utah is missing out on, it’s all the extras that you better believe the Jazz’s marketing department has put a dollar amount on.

In total, if the Jazz puts its same margins on top of their new season tickets’ price to formulate the new price for Single Tickets (I took an average since that algorithm they use for variable pricing is wonky), Utah looks to gain an estimated $13.1M in additional revenue (total of Season Ticket Holders and Single Ticket Purchasers at a 50%-50% split for 82 games) through price increases. That additional revenue can go a long way. That’s roughly 10% of the cost of the new renovation ($125M) to Vivint Smart Home Arena.

Now, let me be clear, I’m not saying that it’s necessarily ethical to price block a certain customer out of your season ticket elite in order to obtain a boujeer clientele, but that’s what a move like this to lower middle class and working poor season ticket holders does just by the price. It makes being a Jazz Season Ticket Holder more of a luxury item the way owning an iPhone in 2012 was. Not everyone had one, but for those who did, it was a status symbol.

While I don’t think it’s intentional, this could have a gentrifying effect on the Upper Bowl. The face of the Upper Bowl season ticket holder (and single ticket purchasers) is going to be different. Most middle class consumers can barely handle a 10-20% increase on the their phone bill, so an increase of 33%-150% to an entertainment expense like NBA season tickets makes the Utah Jazz season tickets a HARD nope at renewal time for current season ticket holders pinching pennies.

Then comes the issue of the amount of time given to these existing season ticket holders to renew: 30 days from today. They have to make their decision quick or they lose their seats and that seat then becomes open for a new customer. From a purely basketball standpoint, it’s an interesting timeline. The Utah Jazz may have just clawed their way above .500 by that point, but barring another turnaround from last year, excitement for this ball club is low right now. That could also factor in additional stragglers abandoning “their beachfront property for the prime years of Rudy Gobert’s career.” This could create an exodus of lower income fans who were stretching to make season tickets work on an annual basis.

With all of the season ticket openings created by fans choosing to forego renewal, that will open up the opportunity for new fans to take their place. Fans that have more stable income and can afford the extra money will have an opportunity to buy into the cool kid’s club. We could be less families and more couples as taking a full Utah family to a game could be more price prohibitive at a time when housing affordability is increasingly out of reach in the Beehive State. There could be more young professionals and less young students. There could also be a new wave of lower bowl season ticket holders who might look at the upper bowl as a way to get some savings and relief on their wallets.

The Utah Jazz have now begun the next step on their rebrand that started in 2016. This step isn’t about the colors, logos, or new threads. A new financial minimum has been placed on this elite club. This change doesn’t mean doom for the Utah Jazz. A wave of cancellations and people foregoing their renewal will just bring an even greater wave of new buyers into the season ticket market.

The Utah Jazz will be able to continue to sell out Vivint, there’s no question. Demand for Utah Jazz tickets will remain high especially with a young star in Donovan, the defending Defensive Player of the Year Rudy Gobert, and the tantalizing possibility of the Utah Jazz adding a third star via trade or free agency.

But the face and makeup of the upper bowl could change dramatically next year because, with these new prices, many current season ticket holders will simply not be able to afford to stick around.