The BBC carried a very interesting piece recently which examines the business model adopted by German club Borussia Dortmund. The author of the article Ben Smith outlines the very different approach taken by Dortmund when dealing with supporters and claims that unlike most modern football clubs, in Germany “the fan is king”.
Remarkably, more than 1,000 British supporters are travelling to each Dortmund for each home game. Many argue that this is due to the cost of tickets with the average admission to a home game a mere £13. The best priced Borussia Dortmund season ticket costs £160. This is in stark contrast to Arsenal where the cheapest season ticket cost more than £1,000.
As a result of this pricing strategy Dortmund have 55,000 season ticket holders and more than 30,000 more on a waiting list. The average home attendance of 80,000 plus makes them the best supported club in the world!
Would demand for tickets fall if the price increased? Probably, but I’d be certain the price elasticity of demand would show that they are an inelastic good for most fans. Why not raise the price? Dortmund would argue it to keep football close to the ‘real fans’, something they believe has been eroded in England. I’m not so sure that’s true.
The full article can be read here.