Is it too late to hit the panic button for TKO?
I’ve written a few different articles since the start of the year about the rather sluggish Wrestlemania ticket sales and the takeaways from that situation. I pondered and threw my two cents into the matter by explaining that I think the executives that tout record-setting profits in the conference calls for stockholders might’ve finally hit the tipping point where the causal, and even a portion of the most diehard demographic were essentially priced out of WWE events. Sure, you’re going to get the niche of the “green shirt guy” that has the cash to travel around and purchase those astronomical seats in the front row, and if he can do that, God bless him, but running in a stadium is a much different equation. When the cheapest ticket in the building is $350 for each night of a two-night presentation, management expected fans to be willing to pay that, as well as all of the costs associated with traveling to Las Vegas.
Under normal circumstances, the economic impact of hosting one of these WWE spectacles is massive, which is why cities bid for the ability to secure the sports entertainment conglomerate’s signature pay-per-views. Plane tickets, hotel reservations, rental cars, uber rides, restaurant spending, and any other way that brings money into the location that usually isn’t there is why the WWE can garner those site fees. Keep in mind, Las Vegas, which has seen a downturn in tourism in recent years, outbid New Orleans, the location originally announced for Wrestlemania 42, to bring the show back for a second year after the numbers it brought in for Easter weekend last year.
The fact that the same location two years in a row might’ve been a contributing factor to the lower ticket sales is a different discussion. The point being that these cities pay a few million dollars for a site fee because there’s an expectation, as well as a proven track record, of fans that will travel to the major events.
As I wrote before, from a storyline perspective, it might be as simple as the fan base was very invested in Cody Rhodes’ two-year journey to the championship, and they already saw the peak of the current era when he won the title so there will probably be a natural dip in momentum that doesn’t necessarily have anything to do with the talent of the performers. Cody, Roman Reigns, CM Punk, Randy Orton, and Drew McIntyre are top guys. But, there are natural peaks and valleys to everything. I think in many ways, the John Cena retirement tour bought the office an extra year of a top drawing card, which is fine because such a milestone should be used to draw as much money as possible before Cena hung up his boots, but the point is, the current decline probably has a lot more to do with the natural progression of Cody’s title win two years ago and this decrease in the numbers would’ve happened last year as a reflection of that if Cena wasn’t the centerpiece of the promotion for the retirement tour.
This goes back to the peaks and valleys mentioned, the ability for TKO to be able to increase ticket prices exponentially over a relatively short period of time was based on the demand of a specific storyline, not something that could’ve been sustainable as a reset of metrics so to speak for the sports entertainment market. This isn’t the UFC, it’s a different demographic with a different level of disposable income and a different set of expectations for their ticket purchases. It seems rather naive that TKO CEO, Mark Shapiro assumed that a corporate paint-by-numbers approach would automatically be successfully applied to the sports entertainment business since it worked for the UFC. The MMA demographic is the 18-34 year old male audience. That group typically has a different level of disposable income than a family of four. As much as sports entertainment has evolved over the years, the draw of pro wrestling was based on the ability of a family to attend the show, which is why the fandom for the genre is passed down through generations. That’s just not the case with mixed marital arts, partially because the sports has only existed in its current form for just over thirty years.
I say that to say this, the WWE office realized that they overpriced WM 42 tickets, which is why they had a 31.6% off sale on all tickets less than two weeks ago for the date on the calendar associated with Stone Cold’s iconic catchphrase. The bottom line is (no pun intended), TKO wouldn’t have a 30% off sale if tickets were moving well, or if there wasn’t a problem getting them sold a month before the show. Remember, TKO didn’t run that sale out of the kindness of their greedy, corporate hearts to make things more affordable for the traditional fan base. If that was a concern, we wouldn’t be discussing the domino effect of the overpriced tickets and the organization’s scattering attempt to remedy the issue.
As of this writing, just above and just below 40,000 tickets are sold for Saturday and Sunday respectively. The problem is, the same event at the same venue sold an average of 60,000 tickets for both nights last year. Depending of the set up of the stage, Allegiant Stadium can range anywhere from 65,000-70,000 seats for the event. Don’t get me wrong, the ability to sell 40,000 tickets for both nights is an accomplishment, but a Wrestlemania event that is more than a third empty is obviously below expectations. Besides the tickets being overpriced, the fact that fans have to literally pay double the price to attend the two-night event also doesn’t help the situation. I understand that they want to maximize the revenue from the fans that travel for the shows, and it’s also an added selling point to get fans to make the trip when they can attend two shows, but at the current price point, the two-night format might be more of a deterrent than anything else.
With three weeks until the event, The Wrestling Observer’s Bryan Alvarez reported that TKO has another sale, not just on Wrestlemania tickets, but also tickets for the full line-up of WWE shows being held that week, including Raw, Smackdown, and the Hall of Fame. Again, there wouldn’t be another sale two weeks after the initial sale if the 31.6% discount was effective. Furthermore, it indicates that the vast majority of the fans that have already bought WM tickets made the decision to spend their cash on the signature show without the extra events, which is proof of how even the fans willing to spend the cash to travel there will budget to specific shows. Given that more than 30% off didn’t move enough tickets to eliminate attendance concerns, it’s doubtful that a 25% off sale will make a major difference.
I’d say that WWE management made adjustments to ticket prices too late, which is why I wrote last month that if tickets were going to move, fans would’ve already had to make plans to attend with plane tickets and hotel reservations. Taking into account that the cost of flights generally increase closer to the departure, as well as fuel costs from the conflict with Iran, it’s doubtful that fans will spend significantly more cash to travel to WM because there’s a partial discount on the ticket price for the show. This might sound trivial, but in the midst of the partial government shutdown when wait times at airports have been atrocious because of the staff shortage of TSA workers that weren’t getting paid, some people might be hesitant to volunteer to deal with the dumpster fire of the check-in process at the airport to travel for the show. Reportedly, Trump signed an executive order that will get the TSA workers paid, as they should be, and presumably back to a full staff, but if Congress is still gridlocked when they return from their two weeks of vacation (since they’ve done such a wonderful job so far), it’s possible that TSA workers getting paid could become an issue again if a budget deal isn’t reached in Congress.
So, is it time for TKO to panic?
No, not really. As I wrote before, much of the concern of the sluggish ticket sales for WM 42 is moot because WWE already has the most profitable WM in the history of the company secured next year when the Saudi government pays at least $100 million to import WM 43 to the country. With the conflict in the middle east, who knows if it will be safe for the performers or the fans, but attendance for that event is also irrelevant because the Saudis bought the show. The Saudi money will keep the stock price stable, and they have a few billion dollars guaranteed for their media rights deals so the sluggish WM 42 sales are minimal in the grand scheme of things. However, the biggest takeaway of this entire scenario for TKO should be that they’ve hit the limit for what domestic fans will realistically pay for the product.
What do you think? Share your thoughts, opinions, feedback, and anything else that was raised on Twitter @PWMania and Facebook.com/PWMania.
Until next week
-Jim LaMotta
Email [email protected] | You can follow me on Instagram, Facebook, & Threads @jimlamotta89
