## Monday, June 22, 2009

### Did Free Parking Make a Difference?

The Dodgers provided free parking at Dodger Stadium on Tuesday, Wednesday and Thursday of last week. Will we see this fabulous offer again? Let's look at the numbers:

 avg attendance[1] free pkg attendance walkup sales Tues 34,895 41,169 3,000 [2] Wed 35,888 46,274 3,800 [3] Thurs 35,822 50,492 4,000 [4] avg 35,471 [5] +10,443 3,600

And the determining formula goes[6]:

 A. [# of additional fans x \$29.66 average ticket price] - B. [# of additional cars x \$15 parking fee] - C. [lost parking revenue from fans who would have attended anyway]

Now let's plug the numbers into the formula:

 A. 10,443 additional fans x \$29.66 = \$309,739. - B. assuming two fans per car: 5,222 additional cars x \$15 = (\$78,330). - C. The paid-parking average of 35,471 fans per game puts Dodger Stadium at 63.3 percent capacity; 63.3 percent of Dodger Stadium's 16,000 parking spaces is 10,128. What percentage of those fans pre-purchased individual or "Mini Plan"[7] tickets that don't require pre-paid parking? We'll assume half, or: 5,064 cars x \$15 = (\$75,960).

That is to say:

 A. \$309,739 - B. (\$78,330) - C. (\$75,960) = \$155,449 net profit per game.

Ding ding ding! We have a winner!

And what of the much-ballyhooed day-of-game ticket sales? An average of 3,600 walkups per game accounted for ticket revenue of \$106,776. Minus the lost parking costs of \$27,000, the team made \$79,776 of its free-parking profit on the day of each game.

In other words, more than half of the Dodgers' free-parking profit was generated by walkup sales, which makes sense given the weekday games. The Dodgers could likely increase advance ticket sales by giving more notice for free parking, or even — heaven forbid — offering it on a weekend, when fans are more likely to commit to plans in advance.

On top of their nearly half a million dollars of free-parking profit, the Dodgers can count revenue generated by additional concession and souvenir sales (including those by fans who reallocated their parking money), as well as the positive publicity generated by the promotion.

The verdict? The Great Parking Experiment of Aught-Nine was a win-win situation for fans and management. Expect to see more free-parking promotions in the future.

1. not including fleece blanket, Casey Blake bobblehead and cooler bag giveaway nights
2. as announced in a Dodgers press release
3. as reported by Robots Took My Medicine
4. as announced by Vin Scully during that game's telecast; actually 4,000+
5. over ten qualifying games
6. "Doo, doo, doo, doo, doo, doo, doo, doo; Doo, doo, doo, doo, doo, doo, doo, doo."
7. It's unclear whether pre-paid parking is compulsory for Mini Plans; we'll assume not.

rbnlaw said...

This is certainly bittersweet news to Parking Lot King Frank Mc Court.

Steve Dittmore said...

Interesting post and information. You assume all of the increased attendance is attributable to the free parking promotion, which it may have been. However, there are other factors which may have contributed such as lack of substitutes (Lakers done), opponent (when was the last time A's played in LA?), record (Dodgers are good, and fans like winners), players (Nomar fans?), how many fans would have gone to the game anyway AND paid the \$15 parking, etc. It would be worth comparing these numbers if the Dodgers do it again.

Steve Sax said...

The Dodgers' next gambit should be announcing that they will be offering free parking for a randomly selected X games through the remainder of the season. That way, people can take their chances and show up hoping to take advantage of it...the Dodgers would get an incremental benefit for all games!

Steve Sax said...

Steve, good points there. We'll have to see if Frank ever does this again, but I'm guessing there's a 50-50 shot (given he's trying a wealth of things to get people in the stadium this year--to his credit, I might add). We'll put our SoSG Analysis staff on it if another opportunity arises.

Also, Mr. Dittmore, might I add that that's a smart-looking avatar?

gCHOW said...

Good info. However, I'd still rather see the dodger tram/shuttle come back to life. Even if they charged \$2/ride, I'd still go on it.

Either way, people forget the traffic nightmare caused by the FREE PARKING DEAL at Dodger stadium. Took me on average 1.5-hours to get home when it usually takes me 45 minutes (my commute is Torrance to South Pasadena).

Unknown said...

Pre-paid parking is not compulsory for mini-plans.

As for the free parking causing more traffic, I didn't see it. I think the traffic was more caused by the higher attendance numbers.

Eric Karros said...

Nice post. To me this means that if they paid us \$15 to park, revenue would increase and additional \$150k per game.

Orel said...

The next Tuesday-through-Thursday paid-parking home games should help address most of Steve Dittmore's questions. As for the A's playing in L.A., I would think their regular appearances in Anaheim would be enough to satiate die-hard A's fans.

Steve Dittmore said...

Saxy - Thanks for the props on the avatar, but it is really just my ugly mug (obviously). I'm on faculty at the University of Arkansas and I try to remain as transparent as possible.

Orel - Fair point on the Angels. I always forget about them :-)

I try to use class examples which students can relate to and this post can certainly be used to illustrate sport economics (substitution effect) and promotion. I hope the Garvey family won't mind me using it (w/full credit).

Unknown said...

Steve Dittmore - You do have a point with the calculation of how many would have gone anyway, though I think another calculation is important. Remember that these 3 games were part of the FURCAL15 promotion, which is part of the larger overall promo to sell tickets for \$9 bucks. That may have driven some of the sales, as the reserve sections were full.

Steve Sax said...

Alireza, great point. In fact, SoSG AC used this Furcal15 discount