Red Sox taking ticket resales in-house
The Red Sox are launching their own online service for reselling Fenway Park tickets next month, replacing previous deals with StubHub Inc. and Ace Ticket Worldwide Inc. as the team tries to cater to its all-important base of season ticket holders.
The new service, called Red Sox Replay, was created with Major League Baseball Advanced Media LP, the league’s digital services arm, and its Tickets.com subsidiary. Buyers and sellers can transfer tickets digitally on the Web or through a free mobile app, eliminating the need to print out or hand over paper copies before a game.
Taking control of online ticket resales will give the team a larger slice of revenues from the secondary market and more direct control over customer service, experts and team officials said.
Season ticket holders will pay lower fees, and buyers will have the team’s guarantee that the tickets are genuine. Ticket sellers will not be obligated to use the Red Sox service.
The Red Sox’ digital ticket marketplace was previously handled by StubHub, which has a long-running deal to provide the service for Major League Baseball. But individual teams can opt out of that league-wide arrangement — the New York Yankees and Los Angeles Angels, for example, use Ticketmaster for their official resale sites.
By launching their own resale site, the Red Sox are also ending part of a nearly 10-year-old marketing deal with Boston-based Ace Ticket, which buys and sells tickets. Ace advertising will be removed at Fenway in favor of promotion for Red Sox Replay, team president Sam Kennedy said.
Ace will continue to have a marketing deal with NESN and WEEI, the team’s official TV and radio networks.
The new Red Sox marketplace will charge standard ticket-holders 10 percent to sell their tickets. Season ticket holders are charged 5 percent, but those fees can also be applied to the following year’s purchase of season tickets, making those sales effectively free. Buyers will be charged 15 percent plus a $5 “processing fee.”
Prices will be set by the ticket sellers themselves. On the Replay website, the Red Sox recommend “looking at other listings to get a sense for where the market price is for your particular tickets.” Unsold tickets can also be donated to the Red Sox Foundation, with a corresponding tax write-off for their value, the team said.
StubHub, by comparison, charges sellers 10 percent and collects an unspecified “service and delivery fee” from buyers, the company said on its website. Terms of the company’s overall deal with Major League Baseball were not disclosed.
Bringing its ticket resale marketplace in-house makes sense for the Red Sox, said Sucharita Mulpuru-Kodali, an analyst for Forrester Research Inc.
“They have unique access to inventory, which is the biggest part of the battle. The bigger question is why these teams took so long to go down this route,” she said. “I think that teams may not have realized how much money they were leaving on the table.”
The New England Patriots, Boston Bruins, and Boston Celtics all have official resale websites operated with Ticketmaster.
Kennedy praised StubHub and Ace, calling the latter “a New England institution.” He said the change was not an attempt to undercut the business of third-party ticket companies, but rather a bid to exert more control over the way season ticket holders in particular sell their unused tickets.
Some 22,000 of Fenway’s nearly 37,700 seats are owned by season ticket holders, he noted. The Red Sox are owned by Fenway Sports Group, whose principal owner, John W. Henry, also owns The Boston Globe.
“We recognize that our customers, buyers and sellers, will continue to use platforms like StubHub and Ace Ticket and myriad other secondary sites out there,” Kennedy said. “This is in no way an attempt to take on any competitive platforms. We’re not doing this as a result of anything that another platform did.
“The ticketing component to any sports franchise is the lifeblood of the organization, and our season-ticket base is the most important subset of customers that we have,” Kennedy said.
Jim Holzman, Ace Ticket’s president and CEO, said his company still has a “positive relationship” with the Red Sox.
“When we entered our partnership with the Red Sox almost 10 years ago, the secondary ticket market was a much different place. It was just a whole different world out there,” he said. “We’ve been around for 35 years and we’re going to be around for another 35 years.”
StubHub did not respond to a message seeking comment.
Harvard Business School professor emeritus Stephen A. Greyser, a sports business expert, said the change was “inherently a smart move” for the Red Sox. Not only can the team offer better customer service, it also will be able to collect data about secondary-market ticket buyers, a potential source of valuable marketing information.
Third-party resellers and marketplaces have to be disappointed, he added.
“I’m sure that they’re not happy,” Greyser said. “The question is, how unhappy are they?”
Massachusetts has an antiscalping law limiting resold tickets to a $2 price markup and added service charges, which the state says can include various “costs attributable to resale.” But enforcement is spotty, and ticket brokers like Ace have advocated for an update to the 1924 statute to reflect the current market for resold tickets.
Edgar Dworsky, founder of the ConsumerWorld.org website, said the benefits to ticket buyers of the new Red Sox service are somewhat muted by the fact that the resale market still leads to significant premiums over the ticket’s face value.
“This is not designed to bring tickets back down from the stratosphere,” Dworsky said. “It’s going to be one more outlet where consumers may have to pay an outrageous price but maybe it’s not quite as outrageous as what the conventional ticket brokers might charge them.”