StubHub Finds Customers Buy Fewer Tickets When Shown the Actual Price

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It’s the most common complaint among ticket buyers: hidden fees, surcharges, and other tack-ons that dramatically change the listed price of ticket.  So why aren’t ticket providers doing more to provide transparent, ‘all-in-one’ pricing that displays the final cost, upfront?

Because it doesn’t work.  In fact, it turns out that people actually buy less when presented with the actual prices.

Offering proof of that is StubHub, one of the largest ticketing providers in the world, a company that is now ending its policy of displaying all-in-one pricing after sales dropped roughly 20 percent on the experiment according to calculations by the Wall Street Journal.  “The hope was that the industry would follow and that would yield greater transparency,” StubHub president Stephen Cutler just told the Wall Street Journal.

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That didn’t happen, and the data simply doesn’t lie.  Just to confirm its suspicions, StubHub started splitting its results in August to display ‘all-in’ results to some customers, and ‘non-transparent, hidden’ prices to others.  That A/B testing, according to the company, caused a small uptick in overall sales, with ‘lower,’ hidden-pricing driving the gain.

Moving forward, StubHub will go back to non-transparent, hidden pricing, at least on its default displays (and in the pricing displayed by comparison engines and Google).

Others, most notoriously Ticketmaster, have no intention of switching.  Several years ago, former Ticketmaster CEO Nathan Hubbard promised all-in, one-price ticketing, though the company was actually moving in the other direction.  In June of last year, Ticketmaster settled a long-running class action lawsuit involving illegally-inflated order processing and delivery fees.

 

 

11 Responses

  1. Name2

    “Customers buy less when shown…”
    Correct.

    “Customers buy less tickets when shown…”
    Not correct.

    Reply
  2. Curtis Jenkins

    Customers are stupid. They love to complain about things like fees, but don’t actually want that. They typically have NO idea what they want, and NO idea WHY they’re buying the things they buy.

    Reply
  3. Name2

    There’s a nice chapter in Kahnemann’s “Thinking Fast and Slow” about consumer behavior and the hypnotic power of numbers, even when that power COMPLETELY contradicts logic and reality.

    One could probably write volumes just about event ticket pricing.

    Reply
  4. Steve

    The number of times I’ve pulled up tickets on ticketmaster, then closed the window before final checkout because of the absurd total cost (vs. actual ‘ticket price’) is probably in the hundreds by now. I hope their entire executive board gets ass cancer.

    Reply
  5. Name2

    I recently blew $395 on a single seat at StubHub for an event. Contrary to my USUAL ticket-buying behavior (which, among other things, is to not buy scalped tix), I just wanted to know the bottom-line number coming out of my pocket. I knew the face value was <$100, but I didn't care. I vaguely knew a little something-something in the background about what StubHub takes as a cut, name-your-price options, etc., but I didn't care.

    I just wanted to know the final damage so I could either pull the trigger or walk away.

    Reply
  6. Rickshaw

    Solution: Show fans the wrong price then charge their credit cards the right price. Few people look at their bill/statement anyway. It’s a win/win.

    Reply
  7. An Agent

    Of course more people bought without the fees shown – because they thought they were getting the lower price. I can’t tell you how many didn’t realize those fees were being added on until it was too late because they don’t pay attention. They thought what they saw was how much they were paying and then SURPRISE! Of course Stubhub doesn’t let you return or exchange, so then you’re stuck with tickets you just paid more for and Stubhub wins because they DO show you the prices – it’s just that you’re too stupid to actually read and they know that.

    Reply
  8. Name3

    I purchased 2 tickets from stub hub and just learned that face value of the ticket are $110.00 with fees and the tickets were going for $160.00 or so dollars, the dishearten fact for me is the face value. just pure greed..

    Reply
  9. Jeremy

    I was wondering what happened, I went to buy tickets on StubHub recently and was hit with huge fees during checkout. Taken aback I bailed immediately! This really sucks, I loved their bottom line pricing but apparently because a bunch of idiots out there can be so easily tricked we have to go back to the hidden price model. At what point are we going to start teaching critical thinking in high school so these shitty practices won’t be so rewarding?!

    Reply
  10. No More StubHub

    I hope to never use StubHub again to buy tickets. 25% mark up on the buy side. No thanks. I’ve made a couple of purchases on Tick Pick where the buy price is still “all in” and probably saved 15% over StubHub.

    Reply

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