Buy and Sell Tickets on StubHub!

The pure play company I chose is StubHub, which is an online market place where individuals can buy and sell tickets for sporting events, Broadway shows, concerts and other entertainment. What is interesting about StubHub and sets it apart from other similar sites such as eBay and Craigslist, is that StubHub makes a profit off of tickets bought and sold. The site takes 25% commission after a ticket is sold. Ten percent comes from the buyer and fifteen percent comes from the seller. There is a shipping and handling fee if customers opt to have the tickets shipped to them, or they often have the option of picking them up at the event. The concept of StubHub is pretty ingenious because not only is it an online market place solely for people to buy and sell tickets, but the site is making a profit as well. People who utilize the site span from season ticket holders to professional ticket brokers. StubHub also has formal relationships with sports organizations including the NHL, NBA, NFL and NCAA making the site more reputable. Also since the site is owned by eBay, eBay users are often directed to StubHub when exploring ticket options.

StubHub has two main business models. Not only does it follow a brokerage model because it is an auction site like eBay, but it also follows a virtual merchant model due to the commission it makes off of all purchases and sales of tickets. People often do not mind paying the small commission as they are looking for a one of a kind ticket, tickets for events that are sold out, or tickets at a discounted price. When a StubHub user posts tickets to sell, they have the option of selling the tickets at a declining price, fixed price, or as an auction. If they select declining price this means if the tickets are not selling the price will get lower and lower as the event date/sell date approaches allowing the user a greater chance of getting rid of the tickets. A fixed price is just as it sounds – the price does not alter, and the auction option is akin to eBay where users can place bids on the tickets they wish to purchase.

Coupling a brokerage model with a merchant model is what has made StubHub so successful. Not only is the site an online market place – a very popular trend in today’s society, but StubHub also makes a profit when tickets are sold. It knows that if individuals really want tickets to an event that is sold out or has great seats they will pay the extra ten percent to buy the ticket. Also if sellers really want to get rid of their tickets, StubHub is the place to post them and only fifteen percent will be taken from their selling price/profit.

StubHub is a very user-friendly site just like other online marketplaces such as eBay or Craigslist. Once a user creates a personal account their home page will display their current activity: all items they are buying and selling, and their personal account settings. The site itself is divided up into categories consisting of “Sports,” “Concerts,” “Theater,” and “Exclusives.” I know many people who use the site and I personally find much more success finding tickets on it than eBay or Craigslist. Also since StubHub has formal relationships with professional and collegiate sports associations, teams often put tickets up for sale on the site.

I think there are a few basic metrics StubHub uses/should employ to evaluate the success of the business. The first thing I remember is that when you register it asks how you heard of the site and the options include: friend, billboard/signage, news story, magazine, other, radio, sports teams, or TV. This allows StubHub to determine what or who is driving traffic to the site and where it should focus its efforts more. The site can also be a way to track the number of tickets purchased and sold and monitor activity including the current number of users on the site. Since the site also follows a merchant model, it can track revenue based on commission it makes. Another tactic StubHub could use to evaluate its success level is to watch its competitors and the presence of ticket sales on other sites such as Craigslist. Also, since StubHub is owned by eBay, eBay should be aware of all ticket sales transpiring on its site and when it is appropriate to direct customers to StubHub.

To create your own account, visit StubHub! It's a great time to get some March Madness tickets!