Springfield Pricing

Executive Summary

Springfield Nor’easter is a new minor league baseball team that aims to be based at Springfield, MA, in order to take advantage the city’s distance from any major league game venue, and a moderate household income, thanks to recent boom in healthcare, financial sector and other small businesses. Besides being a development ground for youth players, the owner of the team wants the team to earn its revenue, and be able to run itself, other than some fixed expenses that are paid by its affiliate major league team. In order to make the decision on pricing therefore, a survey is attempted, but that could achieve a minimal response rate at best. Even though an optimal pricing plan can be arrived from the survey responses, the problem is due to very low response rate, the survey results carry little statistical credibility. Therefore what appears to be marginal break-even for the first season of play, could easily turn into a sizeable loss, if it turns out that the percentage of people not participating in the survey actually are not interested in a minor league game, for whatever reasons. Nor’easters marketing director, Larry Buckingham can therefore take further steps in increasing the awareness of the new team, run campaign to generate publicity among local residents, possibly highlighting the fun facts and family-oriented wholesome entertainment side of the minor league games. He should also run similar survey, may be a bit shorter and easier for people to respond, and take time to collect responses, from at least 50% of sample population. Once more credible responses are recorded, then Mr. Buckingham can go forward validating the price point measurements as done in this analysis based on first survey data, and if the result shows net profit after fixed and variable costs, can hold a big launch party and start selling season tickets from next fall. But Mr. Cortez is right, he need to work with the artist to finish the logo design, otherwise no...