NFL Teams Score Big in the Suite Market

Editor’s Note: Suite pricing across a multi-variant landscape is further investigated in this article, the first of a four part series. The average low and high cost of a suite for each team is sourced from the ALSD Reference Manual. However, the research does not take into account how many suites are priced at each price point, slightly misrepresenting accurate averages, but still providing a credible means of comparison. Tackled first in this issue is the NFL. Check back in subsequent issues for similar analysis for the NBA, NHL and MLB. 

There is no doubt that the suite industry has seen a boom in the past 21 years since the inception of the Association of Luxury Suite Directors. Leagues enjoy the cachet that suite ownership delivers, not to mention the revenue that comes along with it. But which cities do better and why, and does the same hold true for all franchises in that metro area? How do venue expansion and renovation impact revenue per event? What factors best determine suite price? Are the teams in cities with dense populations able to charge more for a suite? Or is team performance more influential?
The numbers are in. And as a new football season begins, a fresh look at each team in the NFL is given here. The research does not get caught up with who won last year’s Super Bowl, but Go Saints! (shameless personal plug). While this might play a role in what the Saints can charge this year for a suite, this article is more objective and based on many factors. All teams are not equal, but how unequal they are varies for many reasons, not just recent on-field success, the age of a team’s facility or geographic location.
The variables taken into account are areas that impact the demand for suites, as reported by industry leaders in the field. They are likely to change by geographic market. The game plan for this study is to organize data across many variables in a single table, allowing trends to emerge that shed light on why some teams can charge more than others for a seemingly comparable product.
The following list includes the variables chosen with the sources in bold type.
v Forbes- Team value of the total franchise
v Forbes- Team value ranking among all 32 NFL teams
v Arbitron- Population of metropolitan area
v Arbitron- Market ranking compared to other metropolitan areas
v Fortune- Listing of the top 1000 companies in the US
v Full House Entertainment Database Marketing- Breakdown of the number of Fortune 1000 companies by metropolitan area
v NFL- Conference,AFC or NFC
v NFL- Division, North, South, East or West
v ALSD- Low and high average cost of a suite
v ALSD- Maximum suite seating capacity for all suites
v ALSD- Suite seating percentage of total stadium capacity
v ALSD- Year stadium was built or most recent major renovations
The goal is to assess how teams are doing within their own suite market and to uncover insights that help teams and leagues improve their inventory performance. Previously, teams were considering only their own metrics when making important decisions. Understanding their performance within the context of other teams could drastically impact their actions. Similarities are found between teams when studied across these criteria as well as some large discrepancies. For example, the Dallas Cowboys have 300 suites, which is the most in the NFL. In comparison, the Minnesota Vikings have the fewest with only 80 suites. The Green Bay market includes only four major corporations as defined by the Fortune 1000 listings. Given the population, corporate presence and number of suites available, one might infer the overall value of the Packers to be low, but the Forbes listed value outweighs nearly half of the teams in the league. Tables 1 & 2 show team standings on all criteria; the charts are broken down by division and conference.
These conclusions beg deeper analysis. The suites at Cowboys Stadium in Dallas make up 10% percent of the overall seating capacity of the 80,000 (expandable up to 100,000) seat stadium. Meanwhile, Candlestick Park, home of the San Francisco 49ers, has the lowest percentage at 1.9% of the capacity of 70,000 seats. Sensibly, both the Minnesota Vikings mentioned previously and San Francisco 49ers have concept designs in place for new stadiums to address these concerns in the coming years.
The most affordable suite presently is found at Ralph Wilson Stadium, home of the Buffalo Bills, at $28,400 for a season. In contrast, the Miami Dolphins have a suite offering that brings in $750,000 annually. Considering the entire NFL, the average low cost of a suite sells for $64,597, whereas the average high end cost is $246,712.
Does the picture vary by dividing the teams by conference? Absolutely. The AFC average for the low cost of a suite is $57,213 versus $71,982 in the NFC. Similarly, the average high cost of a suite in the AFC is $228,819 versus $264,605 in the NFC. How does the NFC manage to command more for lowest price, highest price and total team value? Could it be that it includes more northeastern cities that tend to be more densely populated?
To no great surprise, New York is ranked largest in population by Arbitron in 2010 with 15,669,500 people. The smallest NFL metropolitan area is Buffalo with 968,000 residents, ranking as the 53rd largest marketplace in the United States. As a whole, the AFC plays in a smaller marketplace averaging 3,039,750 people versus the NFC, which averages 4,375,250 people in their cumulative regions. 
In 2010, Forbes assesses the Dallas Cowboys at a team value of $1.81 billion and the Jacksonville Jaguars at a value of $725 million. So while Dallas currently delivers more than twice the team value of Jacksonville, Jacksonville can narrow the margin. Perhaps they build or renovate. Anything that improves the prestige of the brand results in higher team value. It should also be pointed out that other teams on the bottom of the Forbes list also play in some of the oldest venues in the NFL.
While the AFC’s average team value of $995 million is comparable to the NFC average team value of $1.05 billion, the AFC is still not commanding the same level of dollars compared to the NFC on average. Table 3 displays the commanding lead the NFC has over the AFC in all but one variable.
The insights, taken from these tables, show how teams stack up against each other in terms of suite pricing in the NFL. A great deal goes into the business side of suites and how teams justify setting their suite prices. It is not a small consideration. Many factors contribute to the final pricing structure that teams employ. Nobody wants to leave potential untapped revenue, but how do teams know how they compare unless they consider the variables.
 CLICK HERE to see how the 30 NBA teams stack up against each other in the suite market.
 CLICK HERE to see how the 30 NHL teams stack up against each other in the suite market.
 CLICK HERE to see how the 30 MLB teams stack up against each other in the suite market.
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