Market Power

The Effect of the Fall of the Dollar

More Canadians shop in the US (virtually and actually).  No surprise there.

Roush Fenway Racing

Reader Don Coffin sent me this article on Roush-Fenway racing.  The Boston Red Sox, through its Fenway Sports Group marketing arm, have bought an ownership stake in NASCAR's Roush Racing, the racing team that includes Carl Edwards.  It's an interesting read, but this passage puzzled me:

"I think FSG is an opportunity to keep up with the Yankees," said Kennedy. "Their new park will be off the charts and their resources will continue to be dramatic. We're the little brother, trying to keep up with them."

Maybe I took this wrong, but I don't see how owning part of any NASCAR team would improve Boston's ability to compete with the Yankees (not that they need any help!). 

If teams maximize profits, competition will not be balanced unless fans of either team have more-or-less equal willingness to pay for the action on the field.  When a team discovers a new revenue source that is not dependent on the action on the field, it will have no incentive to spend it to improve the team because no matter what it does, that revenue still flows into its coffers.   The article notes that Edwards had a Red Sox logo on his Busch Series car at New Hampshire earlier this year, but is this something that has much of an affect on fan willingness to pay? 

More likely is this:  the Red Sox feel that buying part of a NASCAR team is a cheaper way to advertise than to simply buy a space for a sticker on a race car.  In other words, it's a cost-saving measure.  If so, the savings will rightly flow to the owners, not to players.

California, Eat Your Heart Out

My friend Brad sent me this lateralfest.  I count 15 laterals by Trinity of Texas.

New Category: Economics, Ticket Scalping

Since I have written several posts on ticket scalping of late, I have created a new category entitled "Economics, Ticket Scalping" and I have re-tagged my posts on scalping with this new category.

Why Are Hannah Montana Tickets So Expensive?

Reader Mark Stratton sent me this Yahoo! article about the recent brouhaha about high-priced Hannah Montana tickets on the secondary ticket market.  The third paragraph gets right to the heart of the matter:

"The more fundamental issue is that promoters of the Hannah Montana series apparently haven't priced tickets commensurate with demand, opening the door to a secondary market with much higher prices," the Fed said.

Here is the article from the Federal Reserve Bank of Richmond quoted in the Yahoo! article.

As I noted in this post from awhile back, there are some acts who really understand their markets.  Scalpers have few inefficiencies to exploit in these instances.

The Fed article does discuss something of interest that those trying to get hot tickets know all too well:  scalpers are using technology to essentially cut in line in virtual ticket queues.  This is something that involves IT and legal issues that I cannot comment on at this time.  But the Fed article gives some market-based recommendations on what might be done to minimize the impact of virtual line-cutting.

Somewhere, a King Smiles

King is no doubt pleased.  Has diminishing marginal utility set in yet?

When Businesses Compete, Customers Win

Schnucks pharmacies on Monday will be the first in the region to offer a selection of antibiotics for free. Customers can receive up to a 21-day supply of any one of more than 54 generic, oral antibiotics at no charge.

...Schnucks' announcement comes about a year after rival Wal-Mart Stores Inc. announced plans to offer about 150 generic medications for $4. Other pharmacies have countered with similar plans. And a few — including food and drug chains Meijer Inc. and Publix Super Markets Inc. — are offering free, generic antibiotics in programs similar to Schnucks'.

Story here.

Big XII Teams in the Top Ten, and a Concern

Three Big XII teams rank in the top 10 in both the AP college football rankings and the coaches poll.  Neither of those teams are named "Texas," "Texas A&M," or "Nebraska."  From the Big XII north, the supposedly weaker division in the Big XII, Mizzou is (9th) and Kansas (8th).  Oklahoma ranks in the top half of the top 10.  Congratulations to both the Tigers and the Jayhawks.  Arrowhead will be rocking if you both keep it up.

I had the pleasure of watching Mizzou beat Iowa State this past weekend in Columbia, Mo.  That also means I had the displeasure of watching Mizzou's defensive leader, Pig Brown, go down with a season-ending achilles tendon tear in a non-contact injury.  Pig was trying to run down a player from behind when he crumpled to the ground. 

Been there.  Done that.  Different tendon.

This is eerily similar to what happened last year when, in the 8th game of the season, Brian Smith, the Tigers' sack leader and leader of the defense, broke his hip on a freak play.  The Tigers sat at 7-1 after that game, but they lost 4 of their next 5.  Mizzou is now 7-1 this year and has lost their defensive leader.  Hopefully history's repetition stops there.

New Digs At Okie State

Nice.  HT to Tom Kirkendall.

The Best Fans in Football are Like Most Other Fans

Nebraska football fans have been held up as the best fans in football.  Supposedly.

"People will come up and be like, 'You suck!'" said Bowman, a senior cornerback. "To me, to the team, they say it to anybody. Anybody associated with the football program. It's bad.

"You see them at the games. They'll come up behind the bench and just be like, 'Y'all suck,' or, 'How can y'all wake up in the morning?' I'm dead serious, man."

...At least two other players mentioned that they could hear an assortment of catcalls from fans while sitting on the bench during games. The more vitriolic comments seem on the increase after embarrassing back-to-back home losses to Oklahoma State (45-14) and Texas A&M (36-14).

Bowman and senior receiver Maurice Purify said Tuesday that, at least in their experience, the simple booing of a month ago has given way to more bitter and pointed remarks — and traveling to Texas on Saturday might not be a bad thing for an embattled team.

NU fans know college football.  Nebraska fans of old have been gracious, applauding the opposing team after a hard-fought battle.  I saw this with my own eyes in 1998 when MU lead NU at halftime in Lincoln, only to lose 20-13 to the Bugeaters in the end.  The applause was welcome, and classy, I thought.  Still, I was skeptical that NU fans really were that much different than college football fans from other parts of the midwest.  What if NU didn't have the winning tradition?  What if you replaced "N" with "IS" or "M?"  What then?  You probably wouldn't be able to tell them apart from any other group of midwestern fans:  good, knowledgeable people.  But people, nonetheless.

Now the shoe is on the other foot, and guess what.  NU fans are acting like any other group of midwestern football fans:  gracious when they are winning, not so gracious (and understandably frustrated) when they are losing.  Whodathunk?