THE GRINCH

From the beginning, the one golden business philosophy of the new Cubs ownership has been that no one else except the Cubs should profit from the Cubs in Wrigleyville.

It did not matter that Lakeview businesses such as bars and restaurants have been serving the community for generations (even when the Cubs product could not draw flies). Ricketts strong belief is that no one is entitled to make any direct or indirect money off his team.

No wonder there has been a contentious relationship between the Cubs and the neighborhood. The suit against the rooftop owners was a prime example. Even after the settlement, Ricketts attempted to block them out of business with new jumbotrons. The residents have pushed back on the unilateral demands of the Cubs, but the Cubs have steam rolled the city council to ask for more and more exceptions to the general business rules.

The Ricketts massive redevelopment plan in and around Wrigley Field is clearly "overzoning" for the residential neighborhood. The density and traffic concerns of the area was not truly addressed as the council rubber stamped the development in a time when Chicago is still reeling from the 2008 real estate collapse.

The Cubs sued a man who was selling on the street corner his own Cubs newsletter. Despite the First Amendment rights of publishers, the Cubs were trying to muscle out anyone who would "compete" with their vendors selling game programs. It would seem petty to try to drive out a man trying to sell programs to help support his kid's education, but the Cubs took the matter to the federal appellate court, which gave me a mixed ruling - - - including a statement that the Cubs themselves were violating a city ordinance against peddlers around Wrigley Field. In response, the Cubs quietly lobbied the city to change that ordinance for the team's benefit.

The Cubs placed their own souvenir shop across the street from Wrigley to compete with the other street merchants. The team pushed the envelope by offering official player signed game jerseys.

The Ricketts wanted the triangle space to be an unregulated, open air beer garden. Even that was too much for police and fire to handle. But this is part of the plan to capture every single dollar spent in a mile radius of the park. The idea of more Wrigley concerts is a way to try to diminish other live entertainment venues like the Cubby Bear. It is also a means of the Ricketts family trying to maximize revenue from Wrigley Field when baseball is not played. It is apparent that whole concept that Ricketts wants to create their own year round entertainment center like Disneyland.

But just as sinister of motivations is how the team treats its most loyal fans, the season ticket holders. Season ticket holders paid top dollar for years of horrible Cubs baseball. The Cubs have been near the top of the league with the most expensive ticket prices. Fans were rewarded during the bad stretch with the advent of "dynamic" ticket prices - - - you had to pay more for games with good teams. All prices inside the park increased as well, making it very difficult for an average middle class family to attend games.

So with the World Championship team of young controllable core of players, the Cubs first reaction was to significantly raise ticket prices 6 to 31 percent. The highest toll is being collected on the prime box seats season ticket holders, who are also being pushed to buy "memberships" in the exclusive lounge to be built under Wrigley Field. This lounge is to keep the high rollers inside the park before and after games so they spend their booze money inside Wrigley. Some called the rise in ticket prices a slap in the face to loyal season ticket holders.

Well, the slap has turned into a full sucker punch. The Tribune reports today that many season ticket holders have lost 2017 seats because the Cubs were upset that many "sold" their tickets during the playoffs for greater than face value. The Cubs already collected the face value on the tickets. But the team is upset that it "lost" the secondary market "profit" on those tickets. It is a really tenuous argument. The Cubs set the price of the tickets and collected the money. The Cubs did not lose anything except the notion that someone else is making money instead of the Ricketts clan.

The Cubs claim that its crackdown is to keep tickets in the hands of people who actually plan on attending the games. It is also a way for them to try to maximize revenues, or at least prevent others from profiting handsomely over their popular product, according to the Tribune story.

The Tribune story states that the Cubs season ticket holder agreement is a "revocable license."
Season ticket licenses are renewed on a yearly basis, the club said, "at the sole discretion of the team." The license agreement includes language advising fans their plan may be canceled if tickets have been purchased "for the purpose and intent of reselling the tickets on the secondary market."

It is ironic since the Cubs have been for years "reselling" their own tickets through their own ticket broker. And Major League Baseball has an official partnership with StubHub makes it easier than ever for fans to sell and buy tickets with a few clicks of a button or swipes of the finger. For high-demand teams like the Cubs, the puzzle is how to capture the maximum amount of dollars without alienating loyal and longtime fans, while keeping at least some prices affordable for the average fan, those who study sports business told the Tribune.

So instead of rewarding the most loyal fans who spent the most to support their team, season ticket holders get the harshest brunt of the Ricketts greed. It just puts into focus one of the realities of this era of the Cubs. The fans truly love and admire the players and coaches, but they do not like the owners.

During the playoffs, I told friends that a Cubs World Championship would be the WORST thing that could happen to the Ricketts family. The Ricketts have not completed the bulk of their real estate development work. They have not generated any new revenue from the McDonald's block or the new triangle building. They are spending millions of dollars with the expectation that more people will flock to their venue to see the Cubs.

But one of the driving forces for fans to come to Cub games was the 108 year championship drought. They came to be a part of history, when the curse would be broken. Many paid dearly to attend games or be around the park during the World Series. It was a once-in-a-lifetime moment.

And that moment finished with a World Championship.

And that diffuses and crumbles one of the foundations of Cub fandom: the lovable losers are no more. People have their championship season. They have their World Series merchandise. They have the lifetime memories of the World Series run. Nothing will surpass that emotion.

So there is little reason for the average person to pay 31 percent more to watch in person the 2017 Cubs. Many will save their money for next year's expensive playoff games by watching games on TV. And for a few, once the top of the mountain was reached, there is no need to climb the trail again. They will become part-time, causal fans.  And those new fans who were caught up by the hysteria of the bandwagon, will probably drop off and return to their normal, non-sports centric lives.

All those elements bode for less revenue opportunities for the Ricketts because the Cubs peaked a couple of years too soon to capture all the Rickettsville revenue.

LOTTERY TRAP

The Cubs are holding a "lottery" for 2015 playoff tickets.

The Cubs have a 99 percent chance of making the wild card play in game.

The Cubs have decided to have a lottery for post season tickets. The lottery page screen:

There are a couple points to be made:

1. Despite what the Cubs marketing department has said, the team did not sell enough season ticket packages to have a built in base for all the post-season tickets. The league and opposing team are given a large block of playoff tickets to give to player families, league staff and baseball national sponsors. It is more probable than not that the Cubs lost many season ticket holders this year because of three years of bad teams at high prices and the bleachers being closed for construction early in the season.

2. The lottery page is a blatant data mining operation. If it was a pure lottery, none of the questions is relevant for your chances to "win" the ability to purchase nose bleed seats at inflated prices. If the Cubs are trying to weed out the die hard fan from the scalper, then just open the ticket windows at 6 a.m. one morning and see the true die hards line up. The team has not announced how many tickets are actually available for each playoff game, so thousands of people may be signing up with no chance of getting a ticket. But in order to feed off the high expectations of the fan base, the team is milking their fans to get valuable data to use or re-sell on the secondary information market.

SPENDING MONEY TO MAKE MONEY

SB Nation (via another publication) calculates that the Blue Jays trading deadline moves not only helped the club vault into first place but also helped the bottom line.

When the Blue Jays traded Jose Reyes and prospects for Troy Tulowitzki, no money exchanged hands. Tulowitzki was owed $94 million after this season and Reyes was owed $48 million. That means the Blue Jays assumed an extra an extra $46 million. It was a risk. Except, the Blue Jays have already made that money back.  From Financial Post:

Overall, (Team Marketing) estimates that group of four would pay $270.43 for the whole trip to the ball game, just a few dollars over the MLB average.

That works out to $67.61 per person. Multiply that by 465,000 more bums in seats and you’ve got a whopping $31.4 million — more than triple the extra spending on salaries.

I recall when Harry Carey commanded the Wrigley Field press box. A Tribune executive secretly whispered that Carey was the most underpaid person in the organization. Why? Because he brought in fans to the ball park. But beyond mere attendance, he brought in beer drinking fans (the most profitable segment of concession sales.)

For example, another 10,000 in ticket sales per game by fans drinking $7 worth of beer for a home season calculates to $5.67 million. Plus Carey was a great ambassador for the beer company, who would spend millions more on ball park advertising.

THE COST OF LOYALTY

There were many fans who grumbled about paying premium prices for less than minor league talent for the past four seasons. There were thousands who canceled their season ticket packages because they could not even give away their spare tickets. The Cubs refused to lower ticket prices during their "blow up the team" rebuild.

The Sun-Times reported on Saturday that the Cubs will not give long time suffering fans a break. 

The Cubs’ biggest prospects have barely started paying dividends on the field, but the club has decided to raise ticket prices for some of the most popular sections at Wrigley Field in 2015.

Season-ticket prices will increase an average of 6 percent in the club, field and lower terrace reserved sections of the park. That increase will affect 20 percent of season-ticket holders, while the other 80 percent will have no change or a price drop.

According to Team Marketing Report, the Cubs had the third-highest ticket price in baseball this season at $44.15. The price is high despite the fact Cubs attendance has been on the decline since 2008. 

The Cubs sent invoices to fans a month earlier than usual to give them more time between making the down payment and full payment.. The earlier timeline is one of a handful of changes being made to the renewal process.

Ten percent of the balance must be paid by Oct. 13, with the remainder due by Jan. 13, 2015. Fans can also opt instead for the four-month installment plan and pay 25 percent at a time.

The club has set up a website to ease the payment process. Account holders will have personalized Web pages with tabs to provide information about their account and the renewal process.

The price hike coincides with the renewed fan interest in the club, as young prospects appear on the roster.

It still is a money first, performance second strategy from the Cubs.