Lotteries Suck

That's the email I got from the Mets today. More than a dozen people I know tried and failed to win the right to buy tickets to any of the *four* games offered in this poor choice of method to allocate tickets. It's like the Mets made a conscious decision to prevent average fans from getting Opening Day tickets except through a scalper.

Think about it this way: With a lottery, you guarantee that eBay sellers and scalpers will sign up for the sole purpose of putting the tickets on the secondary market. Since the lottery signup is online, the barrier to entry is tiny (an internet connection and a credit card to buy tickets if you win the lottery) and there are no geographic hurdles (a reseller in Flushing can register as easily as one in Fargo). Because of the low cost of entering the lottery, resellers will enter many, many, many times, lowering the chance that any single Mets fan will win a chance to purchase tickets.

If, instead, every ticket the Mets wanted to sell for these games was put on the auction block, scalpers could still participate, but there would be little profit opporunity for them. That's because fans who want to go to the games would buy tickets at the "market clearing" price. Scalpers could try to bid $51,111,111 for dugout seats, but would be unable to resell them for more.

Using a lottery begs the question: Are the Mets trying to help out scalpers, or are they just too stupid to realize their mistake?

Tickets and You

Wednesday, the New York Times reported on the Mets' plans to make their four platinum priced 2007 games - Opening Day and the 3-game series against the Yankees - available in a lottery. According to the press release:

"The Mets have launched the online ticket registration to provide fans a fair and convenient way to purchase tickets from the limited availability for Opening Day and the Subway Series."

Sure it's convenient to win the right to buy tickets in a lottery - you don't have to stand in line at a ticket window. But whether the lottery is fair depends on your perspective - whether you get lucky and win the lottery, or not. As a public service, here's a quick economics lesson courtesy of Get Untracked.

Fans of all sports now accept variable pricing for tickets, the idea that a Mets game versus the crosstown rival Yankees on a sunny May weekend should cost more than a game on some random Tuesday in September against the 91-loss Nationals. The Mets in fact charge five times as much for an upper deck reserved seat at the former game as compared to the latter ($25 to $5). However, the Mets admit by the act of holding this lottery that they're still not charging enough for those Platinum games. For many fans, the admission price they would be willing to pay for Opening Day or the Subway Series is much greater than that charged by the box office, resulting in a shortage of tickets, more commonly referred to as an event being sold out.

Why do teams underprice their most in-demand tickets? Teams' public relations staff will tell you it's to keep ticket costs low enough that the "average fan" won't get pissed off at a team charging $100 for nosebleed seats at the Subway Series. But that P.R. is B.S. Fans don't feel taken advantage of by scalpers who can get them into a sold-out game. Diehard fans appreciate the ability to pay for tickets to a game they really want to attend, which is why eBay and Stubhub and all the teams' own scalping sites are so successful.

But wait!, you say. Scalping deprives fans of the ability to attend games if they can't afford scalpers' high prices for tickets. Remember, though, there are only about 55,000 seats at Shea Stadium but many more thousands of people who want to go to Opening Day. Even in a world with no scalpers, there will be people who want to attend but cannot. Scalpers make it possible for at least a portion of those people - those who value attendance most highly - to see Opening Day.

The fairest - by which is meant most transparent - way to sell these Platinum tickets would be to hold an auction for each and every one of the seats not already sold to a season ticket holder or otherwise hoarded by the Mets for VIP's. An auction at the start held by the Mets would simply replace an auction at the end held by scalpers, and would ensure that nobody gets "lucky" by winning the lottery and paying face-value for seats that would go for many times as much on the open market. Everybody - not just lottery winners - has the right to buy tickets to the game. That's fair.