Question

Read Case Ticketmaster – Making Better Decisions passage below and answer the following questions 1-4 in bold :

Case Study: Ticketmaster
In 2010, Ticketmaster found out the hard way that the entertainment industry is not, in fact, as recession-proof as it was once widely believed to be. The company, which sells tickets for live music, sports, and cultural events, and which represents a significant chunk of parent company’s Live Nation Entertainment’s business, saw a drop in ticket sales that year of a disconcerting 15 percent. Then there was the mounting negative press, including artist boycotts, the vitriol of thousands of vocal customers, and a number of major venues refusing to do business with Ticketmaster.

Yet 2012 has been more friendly to the company—under the leadership of former musician and Stanford MBA- educated CEO Nathan Hubbard, who took over in 2010 when Ticketmaster merged with Live Nation, the country’s largest concert promoter. Third-quarter earnings were strong, with just under $2 billion in revenue, a 10 percent boost from the same period last year, driven largely by Live Nation’s ticketing and sponsorship divisions. Ticketmaster was largely responsible as well, thanks to the sale of 36 million tickets worth $2.1 billion, generating $82.1 million in adjusted operating income, which translates to an increase of 51 percent for the year.
That’s because Hubbard knows how to listen, and read the writing on the wall, “If we don’t disrupt ourselves, someone else will,” he said, “I’m not worried about other ticketing companies. The Googles and Apples of the world are our competition.”

Some of the steps he took to achieve this included to the creation of Live Analytics, a team charged with mining the information (and related opportunities) surrounding 200 million customers and the 26 million monthly site visitors, a gold mine that he thought was being ignored. Moreover Hubbard redirected the company from being an infamously opaque, rigid and inflexible transaction machine for ticket sales to a more transparent, fan-centered e-commerce company, one that listens to the wants and needs of customers and responds accordingly. A few of the new innovations rolled out in recent years to achieve this include an interactive venue map that allows customers to choose their seats (instead of Ticketmaster selecting the “best available”) and the ability to buy tickets on iTunes.

Hubbard eliminated certain highly unpopular service fees, like the $2.50 fee for printing one’s own tickets, which he announced in the inaugural Ticketmaster blog he created.
Much to the delight of event goers—and the simultaneous chagrin of promoters and venue owners, who feared that the move would deter sales—other efforts toward transparency included announcing fees on Ticketmaster’s first transaction- dedicated page, instead of surprising customers with them at the end, while consolidating others. “I had clients say, ‘What are you doing? We’ve been doing it this way for 35 years,’” Hubbard recalled, “I told them, ‘You sound like the record labels.’”

Social media is an integral part of listening, and of course, “sharing.” Ticketmaster alerts on Facebook shows friends of purchasers who is going to what show. An app is in the works that will even show them where their concert going friends will be seated. Not that it’s all roses for Ticketmaster—yet. Growth and change always involve, well, growing pains, and while goodwill for the company is building, it will take some time to shed the unfortunate reputation of being the company that “everyone loves to hate.” Ticketmaster made embarrassing headlines in the first month of 2013 after prematurely announcing the sale of the president’s Inaugural Ball and selling out a day early as a result, disappointing thousands. But as the biggest online seller of tickets for everything from golf tournaments to operas to theater to rock concerts, and with Hubbard’s more customer-friendly focus, Ticketmaster should have plenty of opportunity to repent their mistake

1. Identify the problems that Ticketmaster was facing, using cause and effect analysis. What were the Symptomatic Effects? What were the Underlying Causes?

2. What process(es) did Nathan Hubbard use to Generate Alternatives? What alternatives were available to Mr. Hubbard? What types of Uncertainty did he experience?

3. How did Mr. Hubbard select his most desirable alternative? Describe which type of Decision Making he used, and explain your findings.

4. Were the recent decisions that Mr. Hubbard made effective, according to the concepts in Chapter 7 – Decision Making? Explain your response.

Answer 1

1. Identify the problems that Ticketmaster was facing, using cause and effect analysis. What were the Symptomatic Effects? What were the Underlying Causes?

The problem that Ticketmaster was facing was a 15 percent drop in ticket sales in 2010 during the recession. The symptomatic effects from this were that Ticketmaster was experiencing negative press with artist boycotts, the vitriol of thousands of vocal customers, and several major venues were refusing to do business with them. The underlying cause of these problems was that the company wasn’t fan-centered and they were inflexible with the ticket sales.

2. What process(es) did Nathan Hubbard use to Generate Alternatives? What alternatives were available to Mr. Hubbard? What types of Uncertainty did he experience?

Mr. Hubbard turned the company more transparent, fan-centered, and flexible. For example, he made it more flexible for the customers to choose their seats when buying tickets. Another alternative was that he eliminated the service fees of paying to print one’s own tickets. In terms of transparency, he also announced fees on Ticketmaster’s first transaction dedicated page, rather than surprising customers with them at the end. The uncertainty Mr. Hubbard faced was making these new changes when everyone was used to the old ones. He did not know how the customers will react to the new changes and whether it would positively or negatively affect the company.

3. How did Mr. Hubbard select his most desirable alternative? Describe which type of Decision Making he used, and explain your findings.

Mr. Hubbard selected his most desirable alternative by creating LiveAnalytics. This is a team who oversees receiving information from customers and site visitors, then taking in their suggestions. From this, it is evident that he used reasoned judgment. He based his decision on extensive information gathering and listened to the wants and needs of their customers, eventually responding to them.

4. Were the recent decisions that Mr. Hubbard made effective, according to the concepts in Chapter 7 – Decision Making? Explain your response.

The recent decisions that Mr. Hubbard made were effective because he collected information from their customers and looked at what they wanted and needed. For example, he also gave the customers more control on what seat they were buying rather than Ticketmaster selecting the best available option. He also reinforced this change by giving purchases the ability to share the events they were planning on going to on Facebook.   The company has become more customer-friendly as a result of Hubbard’s decision.

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