2012 London Games - Economics Assignment LONDON 2012...

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Economics Assignment LONDON 2012 OLYMPIC GAMES P REPARED B Y -: SECTION-A GROUP-4 Arjun Khosla Ria Verma Sneha Manan Suhash Tandlum Arjun Chaudhuri Saurabh Singh
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CORE PROBLEM The core problem in the case is that of Pricing of Tickets to be sold during London 2012 Olympics. The pricing should be decided in a way that the following criteria are met: 1) Revenue Maximization: How to determine the prices of tickets for various sporting events in a way that revenues were maximized. 2) Attendance Maximization: How to ensure that maximum number of people attend the events. In this case, strategy had to be planned for events that were not very popular among the people. 3) Appropriate (knowledgeable) fans at venues: It was not enough only to have the maximum number of audience at the venues, it was equally important to have the right kind of audience who would bring the right kind of energy and atmosphere to the events. 4) Accessibility of tickets in terms of price and availability: Given that the aim of the LOCOG was to make these games “Everybody’s Games”, it was essential that the tickets were easily available and affordable. Williamson, the Head of Ticketing of LOCOG, had been informed that missing either the revenue or the attendance targets was simply unacceptable. Moreover, as these Games had been billed as “Everybody’s Games”, it implied that majority of the tickets had to be sold at prices that the public could afford. Williamson felt that conducting London Olympics was akin to running 26 world championships over a short span of a fortnight. Merely charging the high prices of the tickets was not enough, it was also necessary to take into consideration peoples’ willingness to pay. This depended on several factors like : o Local people’s expectation of ticket price. o Global appeal of the sport. o Local appeal of the sport. o The events staged. o A star team or athlete. Williamson had explicit instructions about attendance. He not only was tasked to sell the tickets but also he had to ensure that people actually showed up for the event that they had brought tickets for. All games are not equally favoured in every city. So, capturing audience for less popular sports events will be difficult. Decision had to be made regarding price tiers of the ticket. Price differential between tickets to the various events had to be determined in a way as to not
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2012 London Games - Economics Assignment LONDON 2012...

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