Business Management

Case Study Analysis

The Springfield Nor’easters:

Maximizing Revenues in the Minor Leagues

Executive Summary

The Nor’easters are a new Class A minor league baseball team located in Springfield, Massachusetts. The overall strategic issue and problem for Larry Buckingham and the Nor’easters’ is having plenty of ticket sales their first season in order for them to thrive in Springfield. The main strategic issues and problems they faced were ticket sells due to Springfield’s loss of many higher-wage-earning residents, the Nor’easters’ estimated annual $1.96 million budget for operating expenses, and the ability to cultivate a loyal fan base that consist of die-hard sports fans. The analysis and evaluation revealed that ticket prices are based on the most economical fixed seat in the ballpark, the minor leagues generate just 26 percent of their total attendance from season-ticket sales, and that Minor League Baseball attracts over 40 million fans a year. The recommendation is to price tickets high enough to distinguish the Nor’easters from the college teams but low enough to lure fans away from driving to Boston, for them to consider outsourcing to help operate within their budget, and for them to sell entertainment, not baseball to cultivate a loyal fan base.

Introduction

The Nor’easters are a new Class A minor league baseball team in Springfield, Massachusetts. Larry Buckingham, marketing director for the Nor’easters, received telephone calls from local reporters informing him that the Falcons (a minor league ice hockey team) also located in Springfield might be leaving unless the team sold 300 more season tickets for the upcoming season. Owner Jimmy Mercante (a Springfield businessman) and President and General Manager Bob Cortez anticipated the Nor’easters first season starting in June 2009. As Buckingham was preparing ticket prices for the first season, he was troubled by the Falcons’ general manager announcement which meant that the...