Sunderland, within sight of a money

Sunderland,

Sunderland, within sight of a money spinning place in the Champions League and enjoying their second biggest average attendance ever, yesterday announced that they were cutting season ticket prices for the 2002-03 campaign. Next season Mackems will, according to the club, enjoy the cheapest season tickets in the top flight with an average reduction of around 10% on this year's prices. The move was taken as the Wearsiders, who currently boast 36,000 season ticket holders, gauge public demand before beginning work on a £9 million expansion of the Stadium of Light to a capacity of 55,555 in time for the 2004-05 season.

"We are proud of our pricing policy and the fact that we can reward the fans," said the Sunderland chairman Bob Murray. "It's not the most affluent of places but we will now, on average, have the cheapest season ticket prices in the Premiership."

The adult price range will run from £320 to £435. "The crowds here are phenomenal. When you look at the

population base of 3.5m and the wealth, it's absolutely stunning. Sunderland's progress over the last few years is unmatched by anybody in football, anywhere in the world."

Sunderland's average attendance is nearly 48,000, and Murray is hoping the move to secure the club's future support will justify building England's second biggest club stadium.

"By the 2004-05 season we will be one of the 20 wealthiest clubs in the world and this is a continued investment in the success of Sunderland," he said. "We have one of the highest wage bills in English football, but our attention remains focused on our season ticket holders and our fan base. Sunderland should be accessible to all, not simply the well off."

The club, currently fourth in the Premiership, boasts the highest percentage of female season ticket holders in the country at 19% as well as the youngest average season ticket holder. With that in mind, they aim to increase the number of under-12s (season ticket prices reduced by £50 to £95), under-16s (from £145 to £133) and young adults (by a maximum of £125) at the Stadium of Light.

"Research has told us that many season ticket holders reach the precipice between 16 and 17, fall off and don't support the club any more because their parents no longer buy their season tickets since they graduated to adult prices," said Sunderland's marketing director Jim Slater. "We're very much hoping that we will retain those season ticket holders and they will support us for the rest of their lives."

"Teenagers are the supporters who tend to suffer most," said Sheila Spiers, who sits on the national committee of the Football Supporters' Association. "If you look at Premier League crowds there are hardly any youngsters compared to a few years ago. Football is in fashion at the moment, but when it goes out of fashion most Premiership clubs will realize that they have not catered for the future."

Read the following caselet carefully and answer the following questions

1. What are the external factors that need to be considered by Premiership football clubs when developing pricing strategies?

2. Compare and contrast cost-based and competitor based pricing strategies vis-a-vis Sunderland.

3. Discuss the bases of segmentation used by Sunderland