Q1: By the time of the case, Williamson has already made some decisions on product architecture and price structure/process. What are they and what do you think of those decisions? In particular, what is the role of “price tiers” for each event?
ANS: Some of the important decision that Williamson had already made about the product architecture and the pricing structure and process is as follows
A total number of tickets would be 7.9 million across all events. This is an important decision which is mainly dependent on the size of the Stadia and what the organizers want from the games.
In late 2010, international and domestic sponsors, the 205 national Olympic committees, the international federations, and other IOC affiliates could place requests for tickets specifying how many tickets at each price point they desired for each event. All would pay full price for any tickets ultimately received and collectively these groups would receive no more than 25% of the tickets. This is another very important decision as one reason why the stadiums were empty in Beijing Olympics was that many of the tickets were allocated to the national Olympic committees and other organizations and sponsors which were not attended by most of them. Limiting these seats to 25% mean they would not impact the attendance to a level that stadiums seem empty.
In the spring of 2011, the general public could similarly place requests for tickets via an online ballot, specifying the event, a number of tickets and price point they desired. This would help to price the ticketing in a way that would maximize revenues and attendance.
In the summer of 2011, ticket requests from both the IOC affiliates and the public would be processed and the individual would be informed as to whether they had obtained tickets. This would provide them with sufficient time to plan their attendance.
Later in 2011 and into 2012, any remaining tickets would be offered for direct sale so that maximum tickets can be sold to ensure maximum attendance.
During the Games, tickets still not sold would be available for purchase at box offices throughout London as was normally done in previous Olympic games as well.
Q2: To get traction on this complicated problem, focus on three sports: aquatics-swimming, cycling-indoor track, and table tennis. Exhibit 9 of the case gives us the decisions of the last three Olympics (Sydney, Athens, and Beijing) on a number of price tiers and specific price levels for these events in prelims and finals. What number of tiers and price levels should Williamson set for each of these?
Aquatics-swimming
Historically, there are always three tiers for the pricing and there were two price levels, one for preliminaries and second for Prelim/finals (where both prelim and finals are contested). So this trend should be continued. However, the pricing should be set keeping in view the desired attendance and revenues.
Cycling-indoor track,
For cycling- indoor track, there were 1 tier and 2 price levels in the last three Olympics. It should continue with price adjustment according to the available tickets, desired attendance level and revenues.
Table tennis
For table tennis, the Athens and Sydney Olympic have two price levels but a single tier. However, in the Beijing Olympics, there were two tiers and two price levels. But it was due to the fact that table tennis is very popular in China. So for the London Olympics, there should be a single tier with two price levels as table tennis is not that popular in Europe, particularly in England.
Q3. Does it make a difference that the London Olympics are a one-time event? Why or why not?
ANS: As far as ticketing is concerned, no, it does not make any difference that it is a one-time event. This is because all bigger sporting event like FIFA football finals, field hockey etc. are played at a gap of four years and are a one-time event for the cities where they are being played. It is a similar event. From an administration point of view, it is different as it is not totally a commercial thing and even the cities spend their own money to support it.
Q4. What are the key metrics by which Williamson should be judged after the games?
ANS. The major target for Williams is to ensure an event that has maximum attendance and revenues. He should be judged for the percentage of target achieved in revenue, ticket sales, and attendance in each of these areas. This is because none of these targets can be compromised. However, apparently, attendance is most important as lack of attendance would cause negative publicity of the event and the city organizing the event along with the IOC.
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