NFL Ticket Demand Probably Didn't Fall

I noticed a story about NFL playoff tickets today. Some of the games are in danger of not selling out and this would result in local TV blackouts for the broadcast of the games. The story is being sold as if demand for NFL tickets is down.

"It would be a tremendous embarrassment to the league to have three of four playoff games blacked out locally, and likely, the tickets will get sold somehow to avoid that scenario. But there's a bigger issue here. Is this the most stark example that NFL fans aren't too excited to go to games anymore?"

But that story is wrong. What is really happening is that the NFL forecasted demand incorrectly. They are charging much higher prices for the tickets - tickets for the wildcard game that isn't selling out are priced higher than their divisional championship game in 2012. So the demand didn't necessarily fall, but the price point did rise and we are seeing that fewer tickets are sold as a result of this.

The headline should read "NFL teams mis-forecast ticket demand and may need to lower prices to sell all of the tickets on time*." But that doesn't make as a good a story.

*For most products it makes sense to keep the price level high enough so that there is supply left over because prices low enough to sell out don't maximize revenue. In general, if a good sells out it means it was priced too low. But for NFL games there are additional consequences to not selling out, from local blackouts of the game to negative signaling about the popularity of the teams playing.