Tickets to sports events like the NCAA basketball tournament are currently sold well in advance of the games. Fans who wait to purchase a ticket after knowing which teams will play are often disappointed because the tickets are sold out by then. Recently, some firms have offered fans the opportunity to purchase forwards on tickets before this uncertainty is resolved. Each purchased forward is linked to a team - if that team makes it, the fan must buy the ticket; otherwise, the forward expires. Such forwards protect fans from uncertainty and provide the firm with assured revenues. This paper presents an analysis of data from a company that offers forwards in a sports ticket market. Multiple models that account for fan heterogeneity are presented to capture forward purchase and resale behaviors. The analysis and findings shed light on how fans mitigate risk in this volatile setting and lay a foundation for future work on consumer forwards.
AllisonP. D. (2005). Fixed effects regression methods for longitudinal data using SAS. Cary, NC: SAS Institute Inc.
2.
BasuroyS., ChatterjeeS., & RavidS. A. (2003). How critical are critical reviews? The box office effects of film critics, star power, and budgets.Journal of Marketing, 67, 103–117.
BerumentH., & KiymazH. (2001). The day of the week effect on stock market volatility.Journal of Economics and Finance, 25, 181–193.
5.
CameronA. C., & TrivediP. K. (2009). Microeconometrics: Methods and applications. New York, NY: Cambridge University Press.
6.
DowlingG. R., & StaelinR. (1994). A model of perceived-risk and risk handling activity.Journal of Consumer Research, 21, 119–134.
7.
FlahertyN. (2004). Battle of the blues.IEE Review, 50(4), 48–50.
8.
GreeneW. H. (1990). Econometric analysis. Upper Saddle River, NJ: Prentice Hall.
9.
HappelS., & JenningsM. (2002). Creating a futures market for major event tickets.Cato Journal, 21, 3
10.
HongH., LimT., & SteinJ. C. (2000). Bad news travels slowly: Size, analyst coverage, and the profitability of momentum strategies.The Journal of Finance, 55, 265–295.
11.
KeenerJ. P. (1993). The Perron-Frobenius Theorem and the ranking of football teams.SIAM Review, 35, 80–93.
12.
KeneseiZ., & ToddS. (2003). The use of price in the price decision.Journal of Empirical Generalizations in Marketing Science, 8, 1–23.
13.
LancasterT. (2000). The incidental parameter problem since 1948.Journal of Econometrics, 95, 391–413.
14.
LeitnerC., ZeileisA., & HornikK. (2010). Forecasting sports tournaments by ratings of (prob)abilities: A comparison for the EURO 2008.International Journal of Forecasting, 26, 471–481.
15.
MarkowitzH. M. (1991). Portfolio selection: Efficient diversification of investments. Hoboken, NJ: Blackwell Publishers Limited.
16.
NeuhausJ. M., & KalbfleischJ. D. (1998). Between- and within-cluster covariate effects in the analysis of clustered data.Biometrics, 54, 638–645.
17.
ParkD-H., LeeJ., & HanI. (2007). The effect of online consumer reviews on consumer purchasing intention: The moderating role of involvement.International Journal of Electronic Commerce, 11, 125–148.
18.
PickensC. T. (2006). Of bookies and brokers: Are sports futures gambling or investing and does it even matter?George Mason Law Review, 14, 227–270.
19.
PopeD. G. (2009). Reacting to rankings: Evidence from “America's Best Hospitals.”Journal of Health Economics, 28, 1154–1165.
20.
RaventosP., & ZolezziS. (2011). Sportsbooks and politicians: Place your bet!Journal of Business Research, 64, 299–305.
21.
SainamP., BalasubramanianS., & BayusB. L. (2010). Consumer options: Theory and an empirical application to a sports market.Journal of Marketing Research, 47, 401–414.
22.
SenS., & BlockL. G. (2009, June). Why my mother never threw anything out: The effect of product freshness on consumption.Journal of Consumer Research, 36, 47–55.
23.
StickelS. E. (1985). The effect of preferred stock rating changes on preferred and common stock prices.Journal of Accounting and Economics, 8, 197–215.
24.
SteinB., & DeMuthP. (2008). Yes, you can supercharge your portfolio!: Six steps for investing suc-cess in the 21st century. Carlsbad, CA: New Beginnings Press
25.
TuchmanR. (2009). The 100 sporting events you must see live: An insider's guide to creating the sports experience of a lifetime. Dallas, TX: BenBella Books Limited.
26.
WestP. M., & BroniarczykS. M. (1998, June). Integrating multiple opinions: The role of aspiration level on consumer response to critic consensus.Journal of Consumer Research, 25, 38–51.
