London Olympic Games
- What are the tradeoffs that Williamson faces?
Williamson has a difficult choice to make whether to sell the Olympic tickets at high or low prices because both options come with positive and negative consequences. He has the task of developing pricing and distribution policies for the 7.9 million game tickets with the aim of maximizing attendance and achieving the target revenue. His challenge is to find the right balance of activities that would satisfy the goals of the stakeholders. For instance, empty seats may not be an indication of poor ticket sales because people can buy the tickets, but fail to attend the main event. Therefore, Williamson needs to sell the tickets to the right individuals and get them to attend the games. High prices may bar a lot of people/ real fans who may not afford the tickets; hence poor attendance and public relations problems. Low prices may attract many fans, but he will fail to reach the target revenue. The ticket prices must be attractive to the people who are interested in the games so that the target revenue can be attained and the seats to be filled up to eliminate problems with public relations. He must also comply with the regulations of LOCOG, which prohibits the sale of tickets at discounted prices to locals but not the European Union citizens.
- Who are the key stakeholders and what is their influence on the tradeoffs?
The London Organizing Committee of the Olympics Games (LOCOG), the Organizing Committee for the Olympic Games (OCOG), the Head of Public Relations and Media, and the International Olympic Committee (IOC) are the major stakeholders. The influence on the tradeoffs comes with the LOCOG perception that ticket revenues are an important legacy of the Olympic Games the view that it is unacceptable to miss the target revenues or the attendance projections. On the other hand, the PR group needs to uphold the position of the Games with the notion of “Everybody’s Games,” which implies that the prices for a portion of the tickets have to be set at a level that the locals and the public can afford. Additionally, both the OCOG and the IOC are more concerned with the maximization of the ticket revenues as well as the attendance on the basis that these factors will impact the broadcast ratings and peoples’ perceptions all over the world. Williamson needs to put all the interests of the stakeholders into perspective and fashion a way of meeting all of them to make the Olympic Games a success.
- What are the implications of the tradeoffs?
Given that the Olympic Games will be broadcast all over the world, with an estimated 5 billion television viewers, a scenario of empty seats will be captured and will give a notion that ticket sales were poor. Such a scenario may be misleading because people may have bought the tickets and only failed to show up at the event. The impression of empty spaces will negatively affect the atmosphere and enthusiasm expected to be achieved by the LOCOG. Failing to attain the targeted revenue due to inadequate ticket sales will adversely impact the total amount of money the OCOG aims to gather through the staging of the event. As such, the tradeoffs may make Williamson meet the goals of one group of stakeholders and fail to achieve another group’s ambitions. Therefore, the success of the Games will be viewed by the stakeholders in terms of the event meeting their specific and unique expectations.