The Springfield Nor Easters Harvard Case Solution & Analysis

The constraints on and the resources available to the organization in solving the problem;

The problem that the Nor’easters are facing is that pricing for tickets have to be set in such a way, which would lead to maximum attendance for the company. In addition, as the revenue from the ticket is not sufficient; therefore, to cover total expenses of the company the people will have to show up for the concessions and merchandise to be sold as that comprises of about half of the revenue of the company. The resource available to counter this problem is Buckingham, the marketing manager of Nor’easters. He has to set up surveys so that he will be able to construct the analysis in order to reach he correct price.

How many people would actually show up at the stadium is another concern for the company as this figure cannot be estimated to the exact figure that will act as a constrain for the company. In addition, resource available for it is the survey that was conducted by Buckingham; this would lead to a possible estimate of the figure of people that would come to the stadium.

The third most important constraint is what if people just do not want to come? People of Springfield desire entertainment, which they can achieve cheaply by watching a movie at home or by going to a cinema or by just trying arm at the bowling alley. As a result, the resource that the company holds to overcome this dilemma is the fact that Nor’easters tickets has to be cheap and easy transportation can be made available but most importantly the management has to make sure that matches are full of entertainment because they are not just selling baseball anymore as they are actually selling entertainment.

Analysis and evaluation:

Using the data available in the survey, an effect pricing system has been developed as to what would be the most favorable price to be charged to the public regarding the tickets they would be buying, which is for one game, for 5 games, for half the season and for the full season. The pricing has been done considering the facts that are provided for the prices, which people are willing to pay.

PRICING FOR A SINGLE GAME

$ on concessions spent per game

$

4

8

13

    
% who buy concessions 

11%

45%

36%

    
         
% who show up

21%

      
# of games

1

      
People interested in going

11621

      
Price

$

4

6

8

10

12

14

 
People who would actually go 

2%

5%

13%

31%

27%

22%

 
Revenue from Tickets

$

$930

$3,486

$12,086

$36,025

$37,652

$35,793

 
         
Revenue from Concess @ $4

$

102

256

665

1,585

1,381

1,125

 
Revenue from Concess @ $8

$

837

2,092

5,439

12,969

11,296

9,204

 
Revenue from Concess @ $13

$

1,088

2,719

7,070

16,860

14,684

11,965

 
         
Total Revenues @ $4 Con

$

1,032

3,742

12,751

37,610

39,033

36,918

 
Total Revenues @ $8 Con

$

1,766

5,578

17,524

48,994

48,948

44,996

 
Total Revenues @ $13 Con

$

2,017

6,206

19,156

52,885

52,336

47,758

 

The most favorable price to be set for a single game is $14with price for the concession being $8.

PRICING FOR 5 GAME PACKAGE

  

5 G ame Optimal Pricing

   
$ on concessions spent per game

$

4

8

13

   
% who buy concessions 

11%

45%

36%

   
        
% who show up      
 

11%

     
# of games 

5

     
People interested in going 

6087.2

     
Price per ticket

$

14

12

10

8

6

4

People who would actually go 

2%

3%

19%

36%

34%

5%

Revenue from Tickets

$

$1,704

$2,191

$11,566

$17,531

$12,418

$1,217

        
Revenue from Concess @ $4

$

54

80

509

964

911

134

Revenue from Concess @ $8

$

438

657

4,164

7,889

7,451

1,096

Revenue from Concess @ $13

$

570

855

5,413

10,256

9,686

1,424

        
Total Revenues @ $4 Con

$

1,758

2,272

12,075

18,495

13,328

1,351

Total Revenues @ $8 Con

$

2,143

2,849

15,729

25,420

19,869

2,313

Total Revenues @ $13 Con

$

2,274

3,046

16,978

27,787

22,104

2,642

The most favorable price to be set for the 5 game package is $8 while price for concession is............................

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