Economic Theory explained by Football – Part 4 – Value Proposition

In the fourth of articles, I try to explain why Dulwich Hamlet rather than most other teams were the real winners on Non-League Day back in September.

On the 6th September, Non-League Day broke all records, with over 50,000 fans attending games in the top three levels of the grassroots game.  One of the biggest crowds was at Champion Hill, home of Dulwich Hamlet, where 2,856 people saw their Ryman Premier League game.  More people attended the game against Hampton & Richmond Borough than at Football League matches at Accrington Stanley, Dagenham & Redbridge, Exeter City and Morecambe.  Pretty impressive, but why did they get so many people to that game?

dulwich-hamlet-non-league-day-1The answer can be found in a theory first proposed by US Economists Ayelet Gneezy and his brother, Uri.  Their research took them around the US, visiting Theme Parks (that is a real job apparently) and testing people’s propensity to part with cash.  Their concept was to sell photos of visitors on roller coasters under the principal of “Pay What You Want”.  Whilst their results showed that more people bought the pictures than when they were at a fixed price, the average price was so low that they actually made a loss.  BUT when it was announced that the Pay What You Want was coupled with a charitable cause, the price paid on average increased by nearly seven fold.  They summed up this behaviour as individuals feeling bad when they paid less than the perceived value for something if they knew the money was going to good causes.

So what has that got to do with Dulwich Hamlet?  Whilst many clubs announced free or pay what you want for Non-League Day, fans didn’t necessarily see the value in the game they were paying to watch.  Some, for instance had already paid to attend as season ticket holders, others were simply skin-flints.  However, couple it with a charitable element, such as Dulwich Hamlet did and people are willing to pay more for the same event, because if they simply paid what they felt the true value to be, they would inherently feel bad – us humans do have consciences after all.

Our own experiences of Pay What You Want back this theory up.  Back in March 2013, 405 attended our midweek game against Carshalton Athletic.  The first encounter had been abandoned due to floodlight failure, yet the re-arranged game saw a bigger than average midweek attendance.  In fact, the attendance was identical to that a few days later on a Saturday when Kingstonian visited.  The average payment was approximately £2.40 per head, about 60% less than we would normally take on a match day.  Compare that to a Pre-Season game, on a Friday, in peak holiday season in July against a team just promoted from the County League with little or no marketing.  An attendance of 250 for the game against East Grinstead Town was more than we expected, but what was very interesting was that they paid £2.50 on average.  Why? Because all of the takings were for charity.

And that, ladies and gentlemen, is The Theory of Pay What You Want in a nutshell.

1 Comment

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