Racing to Lower Sales: Nascar's Dismal Season
The recession's effect on entertainment ticket sales is shared across all venues and geographic regions, but nowhere is it felt more than Nascar auto racing.
Nascar draws its fans from a largely blue collar and predominantly male work force, the two demographics hit hardest by the recession. Even the celebrated removal of the ban on "bump drafting"--a racing maneuver that leads to more crashes--or the near win by female driver, Danica Patrick, hasn't excited fans enough to leave their couches for the raceways.
Bristol Motor Speedway had 55 consecutive sellouts until this season's opener in March when attendance dropped by 20%. Promotions, lower priced merchandise, autograph signings, and lower ticket prices aren't filling the gap there or at tracks throughout the country.
The primary rule governing entertainment revenue requires that when the show goes on, people must be in seats. Once over, there is no way to replace the lost revenue. Since Nascar, like any other form of entertainment, adds to its coffers through apparel sales, food and beverages, and uniquely, pit passes and infield access, the lack of spectators has a particularly detrimental effect to the bottom line.
For race car fans, ticket prices for a family of four are prohibitive when your facing an uncertain future. Look at these costs from two ticket sellers for an upcoming race date at Texas Motor Speedway:
|Section||PU 108||PU 108|
|Cost Per Ticket||$75.00||$70.00|
|Delivery||FedEx (2 day) $11.95||UPS (2nd Day) $18.95|
Interestingly, Ticketmaster, the official partner to Nascar, is priced higher than StubHub, yet no evidence exists that StubHub got their tickets at lower rates. With a package price lower than Ticketmaster, is StubHub losing money? Most conspicuous in the two transactions was the absence of a "convenience" or service fees. Does that mean that Ticketmaster has eliminated their reviled fees, or is it that they've rolled them into the ticket cost in an attempt to hide their own profits. A smart move when considering the market they're trying to sell to.
Sadly, with the year half over, 2010 is not going to improve for auto racing. To the fans collective relief, fewer tickets sold means the high-profit ticket companies aren't making a killing either.