June 12, 2003

Prospectus Today

Something New

by Joe Sheehan

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It's a cliché to say that the great thing about baseball is that you can always see something you've never seen before.

Of course, comments like that reach the point of cliché because they're true.

Last night, the Houston Astros lost their ace starter, Roy Oswalt, in the second inning to a groin injury. This messed them up so much that they went on to use five relievers in completing the first no-hitter against the Yankees in almost 45 years. Peter Munro, Kirk Saarloos, Brad Lidge, Octavio Dotel, and Billy Wagner combined to strike out 11 batters in tossing the first six-pitcher no-no in MLB history.

I'm a Yankee fan, and while I'm frustrated by this team's lack of depth and its terrible problems scoring runs, this was just cool. There's not a ton of analysis to be done here. No-hitters happen, and while the Astros' bullpen is probably more likely to do it than your average starting pitcher--getting lots of strikeouts helps, and the five relievers who threw average 10.1 Ks per nine innings--it's not like you can predict something like this. It was just one of those great baseball events, the kind of game that makes memories for the faithful and turns the uninitiated into fans.

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Onto less enthralling matters...Sammy Sosa's suspension for using a corked bat was reduced to seven games, so the Cubs' superstar began his week off last night in Baltimore. The punishment will keep him out of the last two games of the Orioles series, the entire trip to Toronto and the first two games of next week's trip to Cincinnati.

Five of the six games Sosa will miss are in cities in which he has never played. Given that Major League Baseball has sold interleague play as the opportunity to see stars from the other league--moving to a rotating schedule of opponents to further that goal--it's awfully unfortunate that Sosa will participate in just one of the six games the Cubs play this year in the two cities they've never visited.

It certainly reduces the value of interleague play for fans in Baltimore and Toronto. The Orioles had by far their largest weekday ticket sales (save Opening Day) for their games the last two days against the Cubs, and while much of that is the natural bounce teams get in the summer, it's fair to assume that at least some of it was due to the promise of a show by Slammin' Sammy. The Cubs are third in the majors in road attendance, and it's not because of Mark Grudzielanek.

The situation is a bit more sensitive in Toronto. The Saturday and Sunday games in Canada are two of seven designated "Premium" by the Jays, with ticket prices running about 10-15% higher than normal. It's not just an interleague thing: they're the only two of the Jays' nine games with NL opponents to be flagged in this manner. It's fair to say that Sosa was a big part of that designation; on the Jays' official Web site, the first line of promotional copy reads, "Sammy Sosa and the Cubs make their first appearance at SkyDome."

Now, the Orioles and Blue Jays certainly can't be blamed for the fact that Sosa isn't going to play. But it does create the potential for fans in Toronto who bought the tickets to say, "Hey, you charged me more for Sammy Sosa, and there's no Sammy!" (As far as I can tell, the Orioles did not charge more for the Cubs' series. I expect, however, that they leveraged Sosa's popularity to market tickets for the games.)

Earlier this year, I was asked by a radio caller about variable pricing, which has started to make serious inroads this year. The caller was indignant, focusing largely on the fact that ticket prices would be going up for certain games. I responded that I loved the idea, because while premium matchups, dates, and seats would cost more, almost every team with a plan had the converse as well, with lower prices for many games. Cheap tickets to baseball games are plentiful, a fact cleverly hidden by the marketing geniuses at MLB and the savants who came up with the Fan Cost Index.

Let's face it: ticket pricing has long been inefficient because it hasn't reflected the wide range of demand based on opponent and season. We know that attendance spikes on weekends, for good or attractive opponents, and in good weather months, and yet for years, the only differential pricing teams did was for better seats in the ballpark. The new system allowed teams to price attractive games closer to their market value, while opening up opportunities for fans--including the blessed families who have supposedly been priced out of the ballpark--to see games on the cheap. As far I was concerned, variable pricing was the best business concept to hit baseball in years.

The problem, however, is that variable pricing shifts risk from seller to buyer. The fan purchasing a premium ticket is now paying extra for something that a team doesn't necessarily control: an experience, including things like the weather and star opponents. If you pay a premium price, you're doing it because you expect a premium product, and baseball teams can't guarantee delivery of that product. It's a tenuous position.

In the past, I've not been sympathetic to complaints that fans didn't get what they'd paid for when it came to road teams. Toward the end of the 1998 season, fans in Milwaukee complained when Mark McGwire was benched for a September game at County Stadium. I came down hard on the side of the team, because the ticket they'd been sold was for a baseball game, not an individual performance. Two years ago, I attended the one game of a three-game series in Anaheim in which Cal Ripken Jr. didn't play. I was disappointed to not see the Hall of Famer one last time, but the venom spewed on his replacement, Tony Batista, by the crowd was nothing short of ridiculous.

I know that bad teams often market tickets by advertising the opponent, a legitimate strategy for attracting people to a lousy product. Once variable pricing comes in, however, I think there's an implied contract that the sale isn't for a ballgame, but for something extra, or something specific. If, as is the case with the Rockies, a Saturday in the summer is more expensive because you can expect nice weather, what happens if it's 47 degrees and drizzling that day? If it costs more to see the Giants because they have Barry Bonds, what happens if Bonds breaks his leg two days before coming to town? A fan holding that ticket is still out the extra money he paid for it.

This has already affected the schedule, by the way. A Dodgers/Giants rainout from April was rescheduled for the last Saturday of the season because that was apparently the only day the Giants could do it and still provide "equivalent value" to fans holding premium tickets. That's not the only problem; being in the lower tier has become the 21st-century equivalent of being scheduled for Bat Day, and some teams aren't real happy about the designation.

I'm sure the Jays, Reds and Orioles are happy as hell to miss Sosa for competitive reasons. They have a better chance of beating the Cubs if he's unavailable. However, from the standpoint of the casual fan in Baltimore or Toronto, the kind who interleague play is supposed to attract, Sosa's suspension just denies them their chance to see one of the game's greatest stars.

Maybe it's just 200 people. Maybe it's 2,000. Maybe it's 20,000. I can't hang a number on it, but I'm certain that there are people in those cities who bought tickets because they'd watched Sammy Sosa hit all those home runs and do that kissing thing and this might be their only chance to see it in person. They won't get that now, but their money's in the pot, and that's a problem.

As much as I respect the orginal thought that has gone into implementing variable pricing plans, I have to say I was wrong about them. MLB teams may yet find a way to make it work (without forming LeechCo, that is), but the problem of selling a product you don't control rather than one you do is going to be a difficult one to solve.

Joe Sheehan is an author of Baseball Prospectus. 
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