Examining the relationship between legitimacy-building strategies and firm revenues

Abstract

Research question: The secondary ticket market has traditionally lacked the perception that it was a safe and legitimate place to acquire tickets. The current study examined the relationship between legitimacy-building strategies, such as lobbying for the deregulation of anti-ticket-scalping laws and engaging in partnerships with established sport organizations, and the revenues generated by the largest secondary market firm, StubHub. This study was conducted within the context of National Football League (NFL) ticket resale.

Research methods: StubHub provided ticket resale figures for all 256 regular season games which took place during the 2007 NFL season. Hierarchical regression was utilized in order to examine the relationships between both price restrictions and secondary market partnerships, and ticket resale price and ticket resale volume.

Results and findings: Results indicate secondary market partnerships have a significant influence on firm revenues, increasing the number of transactions while accounting for only slight decreases in price. Anti-scalping laws have a less pronounced association with resale volume and price.

Implications: This research extends academic literature on secondary market operations and provides practical implications as primary and secondary market firms as well as state and local legislatures may use the findings to inform their decision-making.

Keywords:

• organizational legitimacy
• secondary ticket market
• anti-scalping regulations
• ticket pricing
• e-commerce

Notes

1. At the request of StubHub, specific pricing information has been withheld from this manuscript.