‘Funflation’ drives sporting event ticket prices up 25%
John Brown #16 of the Buffalo Bills celebrates with fans after catching a touchdown pass in the third quarter against the New England Patriots at Highmark Stadium on January 08, 2023 in Orchard Park, New York. (Photo by Bryan M. Bennett/Getty Images)
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Dan Hornberger has been a fan of the National Football League’s Philadelphia Eagles for as long as he can remember. As an adult, his office has team memorabilia on the walls.
Last year, the loyal supporter went to five home games, about an hour and a half away from his house. This year, however, Hornberger is on track to attend two games as costs mount.
“I’m a big fan,” Hornberger, 40, said. “Ultimately, it’s just a complete refusal on my part to pay those prices.”
Sports prices have increased this fall, according to federal data. That has made game tickets the latest victim of “sports,” a term economists use to explain the rising price tags of live events as consumers tune in to the experiences. which they lost during the pandemic.
‘Big Bounce Back’
Admission prices for sporting events jumped 25.1% in October 2023 from the same month a year earlier, according to Bureau of Labor Statistics consumer price index data. The sector saw the highest annual inflation rate out of the few hundred that make up the inflation measure.
Overall CPI rose a relatively modest 3.2% on an annual basis. The index tracks the prices of a wide basket of goods including milk, jewelery and air fares.
“We’ve seen this across the entire entertainment and hospitality sector,” said Victor Matheson, a professor and sports economist at the College of the Holy Cross. “People are getting back to things they love to do and are willing to pay a fortune.”
Part of the reason consumers may be seeing higher ticket prices for their favorite sports teams is due to increased use of dynamic pricing models, Matheson said. These structures allow ticketing platforms to get more or less per ticket, depending on demand for the event at any given time.
There is also a line-up of exciting sporting events taking place this fall. Beyond the regular seasons of major leagues, the Formula One race in Las Vegas last week and the unveiling of soccer legend Lionel Messi’s move to the Inter Miami team this summer has boosted fan spending.
But a big reason for the huge 25.1% jump is because of how low prices were a year ago, said Matheson. Teams will cut ticket prices in 2022 in an attempt to win back fans who have grown accustomed to watching at home.
Sports ticket prices were 14.2% higher in October than in November 2019, a smaller gain than the overall index’s 19.6% increase, a CNBC analysis of CPI data showed. Much of the pressure to increase admission costs has come this year, reinforcing the role of sports as consumers shift their attention from Taylor Swift and Beyoncé concerts to NFL and Major League Baseball games.
“We’re seeing a big bounce back in prices,” Matheson said.
Sales of the NFL and the National Hockey League have doubled around 2023 compared to the previous year, according to ticket platform StubHub. NBA sales are up nearly 60% at the start of the season compared to last, while college football is up about 50%.
To be sure, not all sports this year have seen the same price growth. StubHub said ticket prices across the top 10 major sporting events were 15% higher in 2022 than in 2023.
Matheson said overall tamer inflation should help cool sector-specific growth. A return to more normal entertainment consumption habits after the post-pandemic surge in knowledge can help reduce demand and prices, he said.
Rodney Paul, director of the sports analytics program at Syracuse University, said interest in attending games should remain somewhat stable even if the economy worsens. That’s because a large portion of the consumer base is well off enough to afford pro-sports tickets — which he said is largely a luxury — and should be able to afford a better discount. due to their financial status.
But Paul said a significant change in the state of the economy could push less financially stable fans to cut back on additional costs, in turn hurting demand. Cash-strapped shoppers may justify spending more than they’d like this year by reminding themselves that they didn’t spend much or anything on game tickets during the pandemic, Matheson said.
Part of the financial burden comes from the resale market for tickets, some sports fans say. An increase in the price of parking and food inside the stadium must also be factored into the financial calculations of fans like Hornberger and Sara Weddington.
Weddington was able to save enough to attend a Kansas City Chiefs game last season, but said she felt out of the question this year because prices have gone up. up The longtime Kansas City area resident said she feels for people who never got to see a game before the recent cost hike.
“It’s worrying for such an important part of the community to be so out of reach for a lot of people,” said the 23-year-old. “It’s like you can’t go to a game or go to a candy store and not to be able to get candy.”
However, Syracuse University’s Paul said that sports have taken on new meaning in the post-pandemic world. As people work from home more and more, he said there’s a greater need for personal social spaces — and those who can afford it are more willing to go out.
“There’s a real longing for the kind of sense of unity that the world of sports brings,” he said. It’s “a really interesting experience that might be even more interesting now because people missed it in the past.”
— CNBC’s Gabriel Cortes contributed to this report.