WWE has yet to hold 1 single event in front of wrestling fans since the middle of March 2020. Since then, they've either gone empty arena, developmental wrestlers posing as fans ringside, and/or having multiple screens (the "Thunderdome"). Obviously, this is due to the COVID-19 pandemic in which the virus is easily spread within mass gatherings. For 2021, once the vaccinations are given to the general public, the WWE will probably try to hold live events again. I can imagine that they'll roll them out slowly but with time and confidence, larger arenas the nation will hold events again. Those things are funded by tax dollars and are a source of additional tax revenue. States will reopen them once the liability risk of the virus is gone.
Point being, when the WWE begins to hold Live Events with fans again, they need to start thinking about their consumers. After all, the Economy has officially been in a Recession since February 2020 and many Americans (including wrestling fans) have been hit with unemployment and in many cases, their jobs won't be returning. Even if we get out of this health crisis, we'll still have a few years to sort out the economy and get it fully moving again.
With that said, if the WWE wants to begin touring again, they need to be more considerate of wrestling fans.
In other words, stop price gouging them on tickets.
Here are the average ticket prices for the last 6 years, as reported by the WWE's own 10-K Financial Reports on North America:
Look at that last price increase for 2019.... And then also consider that the WWE began to cut back on houseshows and we were a full year with the combined Pay Per Views as well. While the reduced attendance could be blamed on fewer events being put on during 2019, if you divide total attendance divided by # of shows, 2019 is also significantly less than the prior years. IN FACT, 2014 to 2017 hover around 6,000 fans per show while 2018 and 2018 are more close to 5,000 fans.
If you have ever taken an economic course in college, you would know that the Law of Demand states that there is an inverse, indirect, or negative relationship between Price (P) and Quantity Demanded (Qd). In other words, the variables move in opposite directions. When prices go up, consumers demand less of a good or service. When prices go down, they'll demand more... That is, unless an outside factor like Income, Tastes or Preference, or Population Growth causes the consumer's price threshold to change. For example, if I obtained a raise at work, I have more disposable income to spend and I become LESS price sensitive... However, if COVID-19 caused you to lose your job, you are going to cut back on spending and therefore become MORE price sensitive.
Right now, the WWE's television viewership is in a major decline as we're seriously becoming not just permanently under 2 million viewers for USA Network's WWE Monday Night RAW, but maybe under 1.5 million. RAW's viewership is eroding fast and fans are very unhappy with the Creative Direction of that show. WWE Smackdown is kind of stuck at 2.0 million viewers... It's not eroding quickly right now, but it's not growing either. Bear in mind that the show started off as being near 3.0 million viewers per show.
Overall Tastes & Preferences for the WWE among consumers is DOWN right now... COVID-19's causing of a Recession has caused LOST incomes. Therefore, the price willingness of your wrestling fans to pay for WWE live shows is quite low right now. Paying an on-average $64 per show is rough and that ads up if you took an average family of 4. Oh, and there's parking... The kids will want merchandise and WWE's shirts are freakin' $35. Arena snacks are NEVER cheap. It adds up quickly will cause your standard family to not go as often.
WWE needs to watch the NBA and the NFL very closely, particularly as both return to playing games in full stadiums again. Their ticket prices are through the roof and both leagues are very demanding to have mostly Season Tickets sold rather than general admission. On top of that, the stadiums or arenas will charge an annual Personal Seating License to each Season Ticket holder. For decades now, older fans have been paying for these like a regular routine. If you've attended any games, you'll see the same kind of person everywhere... Middle aged guys everywhere.
If you look at statistics, the majority of the wealth held in the United States is by guys 50 years or older. The average net worth of someone aged 45 to 54 is about $725,000 and someone above 55 is about $1.2 million. Compare that so someone under the age of 35 at about $76,000. Your net worth combines your income, savings, stock holdings, investments, and assets. As you get older, you'll earn more income to buy more things, investment in more markets, or just save overall. That, or you could just spend it on Pittsburgh Steeler tickets?
Both the NBA and NFL, however, are starting to see this older fanbase decline in both viewership and attendance. For both leagues, they've been affected by politics in the forms of protesting the National Anthem, placing political messages on courts, jerseys, and equipment, while lacing broadcasts with various political messages. The end result has seen the older fanbase beginning to boycott these leagues. Both the NBA and NFL have seen attendance and viewership declines. 2020 has been especially brutal on the NBA, as their NBA Finals viewership was legitimately down 50% and that was despite its top star, Lebron James, appearing in the finals with the league's most famous team, the Los Angeles Lakers. NFL is seeing declines as well and advertisers are beginning to become more demanding of the "bang for their buck".
However, for both leagues, they haven't had fans in their stands for their seasons since March 2020 (or just a few fans for NFL games). Both the NFL and NBA have yet to endure the Live Attendance fan reaction because of COVID. It his highly expected that Season Ticket purchases will decline significantly for both the NBA and NFL due to politics being injected into the games. Because of that, their DEMAND to attend live games will go down and they will NOT be as willing to be price gouged by the NBA or NFL as they once were. The NFL and the NBA have major issues to sort out when their games can be fully attended again, possibly during mid-to-late 2021.
The NBA appears to have a LOWER ticket price than the WWE, but this differs heavily per market. Attending a Knicks or Lakers game is far more expensive than a Bucks or Grizzlies game, for example. The NFL, however, has an average ticket price of $151 per game!
In WWE's defense, they have not upset the 50+ year old fanbase. To WWE's credit, they have mostly stayed out of politics and have tried to understand that their programming is an "escape" for fans. Their decline is due to a LACK OF QUALITY from their wrestlers and creative team... Fans are just bored with the product... NBA and NFL, in my opinion, have not dipped in quality. In fact, I'd argue that the games are becoming more exciting with new superstars arising in both sports.
Point being, WWE needs to possibly learn from the potential declines in the NBA and NFL and consider LOWERING their Ticket Prices for their events.
Also, consider moving to arenas that are not as expensive... During late 2019, All Elite Wrestling (AEW) was starting to struggle to fill their usual 5,000 seat arenas. In other words, they are NOT A THREAT to tour the same 10,000 to 20,000 venues that the WWE tries rotate within to keep competitors out. Therefore, the WWE can consider holding their events in SMALLER arenas to save money on leasing fees and also give them a chance to offer a LOWER price to their wrestling fans.
I wrote about this extensively through the early 2010s when the WWE began to consider WWE Network. They had concerns about their declining Pay Per View buyrates YET THEY DID NOT NOTICE that their repeat increases in Pricing killed that golden goose. In a short period of time, they cranked up the price of Pay Per Views from $24.99 during the early 2000s to $44.99 through late 2013. On top of that, the WWE tried to increase the amount of Pay Per Views by allowing each brand (RAW, Smackdown, and ECW) to have their own monthly Pay Per View. They were not only price gouging their wrestling fans but burning them out with too many choices. On top of that, the split brand PPVs were terrible!
Over the past 5 years, the loyal 50+ year old WWE fan have shown their loyalty and have been paying those higher prices. Hence why the WWE's revenues were increasing despite lower attendance and viewership. The loyalist of loyal WWE fans were paying more PER YEAR than ever on merchandise, live events, WWE Network, etc.
However, we've just been hit with a major Economic Recession thanks to COVID-19.
Usually with an economic recession, the Unemployment Rate usually lags behind the rest of the economic variables. Why? Employers need some extra confidence to be ensured that the "worst is over" and that it's financially worth it to expand their business again. What an employer does not want is a double-dip based recession where they thought that everything was OK again and began expanding only for another economic downturn to hit.
It's going to take a while for many unemployed Americans to find work again, as many businesses were forced to close due to the State issued quarantines. If you just look at the Movie Theater business... COVID is restricting the production of movies to be made and people are fearful of attending movies in theaters now. Also, they are becoming more adjusted to just streaming movies from Netflix, HBO MAX, Disney+, Amazon Prime, and others. The convenience factor is fully realized... Bars, clubs, and other businesses relying on socializing and the nightlife will be in deep financial trouble. Cruiselines will be done... And with Wrestling and Sports not having events, that's fewer parking attendees, food service workers, maintenance crews, merchandise sellers, etc. working at large events. People aren't driving as much and therefore, domestic drilling is down because we have an abundance of supply. That's not good for an Oil & Gas worker. Look at all of the national chain restaurants and store that have closed down.
With a major DECLINE in demand to watch WWE live, as assumed from the RAW viewership drop especially, combined with economic hardships endured by the fans... WWE needs to seriously consider being generous to their fans. Lower the prices and potentially create discounted prices if you a WWE Network subscriber to help combat scalpers.
Do you really believe that you can charge $64 to wrestling fans for live shows right now? No way... Demand is just not there. There might be some pent-up demand due to fans wanting to get out and do something, but to pay $64 to see Randy Orton wrestle the Fiend in a Main Event of a Pay Per View? Please...
This is where the WWE potentially acts as a monopoly... They try to be exclusive to an arena while charging higher prices than they should. Yet, what they don't realize is that they need major fan goodwill right now.
During 2018, I actually attended a LIVE Smackdown televised show and had 3rd row tickets for that event. Damn floor seats were expensive... If I tried to get the 1st or 2nd rows, I would be required to saw off an arm and a leg. However, my main point of attending this show was how much I enjoyed the Smackdown show that I attended. Being in the 3rd row gave me a whole new perspective on the event and I thought that most of the matches were really good. I wrote my review of the show and I was attacked on all fronts by WWE fans. They thought that the show SUCKED and that I was out of my mind for praising it.
See, this is what wrestling fans need... They need to attend the live shows to appreciate how hard the wrestlers are actually working in each and every match. Maybe you just don't see that on television, as watching a show live in attendance allows you to hear sounds that you wouldn't hear on television and see things that the camera men aren't watching.
BUT, by having higher prices, you are blocking off any younger wrestling fans from attending in the first place. Hence why the WWE's demographics below the age of 40 are terrible right now. Following this economic recession, many of your loyal WWE fans above the age of 40 might not have as much disposable income as they did before the recession.
Thus, WWE... LOWER THE DAMN TICKET PRICES!!!!!
And go to smaller arenas. There is ZERO shame in that and there is MORE shame in paying more lease money to a place that you're tarping 2/3 of the arena off anyway.
One would figure that a man with a business degree and now CEO/President and Board Chairman named Vince McMahon would know a little about economics... Right? Maybe several in the Marketing Department? CFO? I could suggest the Chief Brand Officer, but she has a communications degree... And her husband never attended college.
If someone's Income or Tastes/Preferences INCREASE, they won't be as sensitive to higher prices... If Incomes or Tastes/Preferences DECLINE, they will become more price sensitive than ever.
Be good to your fans... 1.5 million of us have stayed loyal to you for years and have endured many bad years of poor Creative and the wrong Talent being pushed to the top. Yet, we're still here... Give us a financial break to make us eternally grateful to you. Take, for example, the WWE Network priced at $9.99 and that has NOT changed since 2014. Your loyal fanbase LOVES that streaming service.
Give your fans a financial break on the ticket price and they might reward you with more merchandise sold. After all, all of your merchandise is assembled overseas in Asian countries and I GUARANTEE that you make more on the margins of merchandise than paying the arenas on leases for ticket sales. Seriously, it probably costs $0.20 per t-shirt and the WWE sells them at $35 per shirt.
Your own 10-K report from 2019 suggests that the WWE made $125.6 million at Live Events. If you look at that as a percentage of Total Revenues, $125.6 Million divided by $960.4 Million... 13% of total revenue. Mind you, this only had 1 quarter of the new RAW & Smackdown deals. Had the WWE held Live Events during 2020, it would be much lower as a % contribution due to those larger TV Deals.
TAKE CARE OF YOUR FANS and REDUCE TICKET PRICES please, WWE.
Do the right thing that will surprisingly create other "multiplier effects" to grow your bottom line. Fans would attend more events at cheaper prices, maybe feel confident to buy more merchandise...
Otherwise, keeping your prices high will scare away more of your longer time customers and convince other fans not to become a WWE fan ever.
So just chill... Until the next episode!
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