Batter Up! Houston MBAs Help Astros Rethink Ticket Pricing
by Behnaz Abolmaali
Are tickets to a prime-time baseball game featuring two All Star pitchers worth the same amount as a midweek matchup against a team with a losing record? That’s the dilemma four classmates in the Texas MBA at Houston program posed to the Houston Astros baseball team last spring.
Michael Covey, Brandon Grimm, Jonathan Alford and Craig Eissler, all MBA ’09, completed the project as part of the ENHANCE program, which gives working professional and executive MBA students who do not have the opportunity to complete traditional internships a chance to work on current business issues in a consultant role.
The Astros currently use a flat-rate ticket price for all games. The ENHANCE team wanted to see what factors drive attendance.
“We noticed, in talking to the Astros and becoming familiar with the market, that there was not that much hard data on why the team does certain things,” says Covey, the project leader. “We know that a Wednesday game is less attractive than a Saturday game, but now with our help, they can actually quantify how much less attractive a Wednesday game is to a Saturday game.”
The students first analyzed data related to ticket sales during the last three Astros seasons and also studied public data from other teams in the league. Then they ran different models and regressions.
“The best part of the project was that we were able to apply the skills we learned in school, such as working with software and stats, into a real-world project,” says Covey. “It opened up our eyes to things we can do internally at our companies. When we have a hunch about something we want to do at work, we can actually run numbers and quantify the value of certain things.”
The team took advantage of their diverse backgrounds to approach the project from several angles. Eissler, a mechanical engineer at the Fluor Corp., and Grimm, a chemical engineer with Clariant Services & Products, brought statistical backgrounds to bear. Covey, a manager at Continental Airlines, and Alford, who works in product development for insurance agency Kilpatrick Cos., Ltd., brought business instincts and insights.
“In this project we needed both the financial prowess as well as the opportunistic- type thinking to deliver for the Astros. The engineers provided the technical data, and the businesspeople were instrumental with the recommendations,” Alford says.
“The most rewarding thing was delivering for the Astros; they asked us to deliver, and we did,” Alford says.
