Some Hawks season-ticket holders have had to decide how much of a premium they are willing to pay for the best seats in the house at Philips Arena.
The Hawks have notified VIP season-ticket holders that ticket prices will increase by nearly 50 percent for next season. The Hawks made the decision after researching premium ticket prices at other NBA arenas and also considering the demand for their best tickets.
VIP tickets are club seats, suites and seats in other areas that the team designates as “premium seats.”
To prepare its VIP ticket holders for the potential sticker shock, the team’s marketing and sales employees called them before renewal information was sent out. Friday was the first renewal deadline.
“We absolutely don’t want to lose season-ticket holders,” said Tracy White, the Hawks’ senior vice president for sales and marketing. “But at end of the day we had to take a hard look at what the value is in specific areas, particularly those where we are at capacity or near-capacity and people continue to express interest in getting in.
“Where we have had to make a decision if [tickets] are appropriately priced, we looked at what is going on in other markets while still being sensitive to what is going on economically.”
To soften the blow, the Hawks are offering premium-seat holders incentives that include food and beverages in the cost of the ticket.
The Hawks also are decreasing prices for non-VIP seats in the lower bowl by an average of 3 percent for next season.
Even after the dramatic increase in prices for premium seats, White said the Hawks’ average season-ticket prices will rank among the bottom third of the NBA’s 30 teams. He said non-VIP seating in the lower bowl and upper level will rank in the league’s bottom 20th percentile.
Overall, White said the average season-ticket price for Hawks games will increase by .08 percent.
“It’s never a popular decision when you raise prices in any areas,” he said. “We are very strategic with where we are increasing prices and strategic where we are decreasing prices.”
The spike in premium-seat pricing comes as the Hawks enjoy an on-court resurgence.
They were tied for the third-best record in the Eastern Conference on Friday and are on pace to finish with at least 50 victories for the first time since 1997-98. Their 26-7 home record was third-best in the East before Friday.
“We believe we offer a good value,” White said.
Despite the team’s success, the Hawks’ average announced attendance of 16,092 for 33 home games this season ranks 20th in the league. They have sold out six games.
White wouldn’t say how many season tickets the Hawks sold for this season. He said the team sold 2,300 new season tickets this season and already is on pace to top that mark for 2010-11.
White said the season-ticket base has “grown steadily” over the past four seasons but still isn’t where the Hawks would like.
“To get to sellout situations you’ve got to have a strong season-ticket base,” he said. “If you have a small season-ticket base it is very, very hard to move an additional 15,000 tickets for 41 games, especially when you have weeks of three or four games.
“You want to get to 10,000 [season tickets] and then you are talking about 8,000 a game [walk-up customers], and that’s much more achievable.”
The Hawks’ ticket-price increases come during difficult financial times for many of their customers and also for the NBA. At All-Star weekend commissioner David Stern said teams would lose $400 million this season (though he made the remarks while making the case for a new labor agreement with players that is more favorable to owners).
Lagging demand for tickets might be part of the problem. According to Team Marketing Report, a sports-marketing research firm, the average cost of an NBA ticket fell 2.8 percent to $48.90 this season, the first decrease since the 2001-02 season.
TMR compiled those figures before some teams, including the Hawks, began to offer significantly discounted individual game tickets and other incentives to spur demand.
TMR said the Hawks rank 12th on its Fan Cost Index, which includes an average-priced ticket, two small draft beers, four small soft drinks, four regular hot dogs, parking for one car, two game programs and two of the cheapest adult-sized caps.
According to TMR, the average price of $51.78 for the Hawks’ non-premium tickets ranks 13th in the league. That suggests the Hawks’ premium prices had lagged behind those of other teams until now.
White said the Hawks rank No. 1 in the league in individual and in the top half in group sales, which include tickets that aren’t part of a mini or season plan. Though Hawks’ attendance numbers haven’t kept pace with their winning, the individual game sales suggest there is an interest in attending games if the price is right and no long-term commitment is required.
“I think that’s a fair statement,” White said.
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