Next time you do the 'lottery' - thoughts and analysis

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Next time you do the 'lottery' - thoughts and analysis

Postby clerkkent » Tue Feb 14, 2012 12:40 am

Figures provided estimate there were around 110,000 requests for 40,000 tickets. What wasn’t disclosed is how the requests were partitioned amongst the three tiers.
If we assume that request were proportionately dispersed over the actual ticket availability ratio, then we would have the distribution shown under the ‘evenly prorated’ column. However, if we assume that burners are naturally inclined towards a bargain, we could then safely assume that requests would be biased towards tier one (the cheap tickets).. one possible distribution can be found in the ‘bargain seeking’ column.

Tier qty avail price evenly prorated bargain seeking
Tier 1 10,000 $240 27,000 50,000
Tier 2 15,000 $320 40,500 29,000
Tier 3 15,000 $390 40,500 29,000
40,000 108,000 108,000


As much as BMORG tried to avoid the term ‘lottery’, at the end of the day, the process involved a consideration (in this case, entering one’s info and a valid credit card) for a chance to earn a reward (opportunity to purchase tickets, perhaps at a bargain rate ($240) than expected future prices ($390)). As the reward was great, and the consideration was next to nothing, this coupled with perceived scarcity and the self fulfilling specter of a ‘lottery’ triggered an avalanche of entries.


Although we really have no way of calculating the ratio amongst the 110,000 entries, we can assume three groups of people enrolled to purchase tickets:

1) People who actually want to by a ticket so they can go themselves
2) People who want to get a ticket because they want to help out friends or family, but have no intention of going themselves.
3) Profiteers who are buying for resale


2 major policy changes that would winnow down the number of distorted entries :


Flat rate pricing – removing the tiers.

In the recent ‘lottery’, the were limited number of the lowest priced tickets ($240), and it was going to be the only time that tickets were going to be available at that low price. As such, a surge of entries happened in order with the hopes of getting a ‘bargain’. Despite all the tenets of the Burner community, including paying the highest price you can, human nature predominately yearns for a bargain. After the main round of ticket sales occurred, the remaining tickets are to be available for $390… thus, a $240 investment becomes a $390 asset in a few months. After fees, that is a fifty percent gain in 3 months, or an annualized 200% profit.. enough to attract the attention of scalpers. By removing the tiers and implementing a flat price, you remove the enticement for bargain seekers, while Profiteers no longer have the shelter of being able to compare the current BMORG price to their marked up price (“ So what if I paid $240, Burning Man is selling their tickets for $390.. You’re not complaining about their prices!”)



Requiring a deposit - Require all applicants to put forth a deposit, anywhere 20% to 100% of the expected ticket price (assuming a flat rate price structure). The deposit would be credited to the buyer if they are selected for tickets; other wise would be fully refunded if they were not selected for tickets

Having a required deposit would reduce category 2 people because friends& family are less likely to tie up a sum of money for a friend vs enrolling a credit card and then getting paid back should they get picked.

Having a required deposit might reduce category 3 people because scalpers are less likely to tie up large sums of money to increase their odds. In the recent lottery, scalpers could feasibly enter infinite times at no cost, other than having valid credit cards on file. If each entry required money upfront, small time profiteers would unlikely have the cash to front such an ‘investment’.



Some things I do not know - whether requiring money up front now makes the ticket ‘lottery’ an actual lottery, subject to lottery rules and regulations. Secondly, I’m unclear if requiring deposits from all potential ticket buyers is permitted by assorted regulations.
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Re: Next time you do the 'lottery' - thoughts and analysis

Postby junglesmacks » Tue Feb 14, 2012 5:53 am

...because what we needed was yet another lottery analysis thread.
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Re: Next time you do the 'lottery' - thoughts and analysis

Postby clerkkent » Tue Feb 14, 2012 7:14 am

C'mon, our grand kids will be studying this case in business school! :P
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Re: Next time you do the 'lottery' - thoughts and analysis

Postby 5280MeV » Tue Feb 14, 2012 7:26 am

clerkkent wrote:C'mon, our grand kids will be studying this case in business school! :P


My grandkids will be studying this at home:

"Back in the 2012 ticket crisis, things were not easy like they are today..."

"No Grandpa! I don't wanna hear another ticket story"
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Re: Next time you do the 'lottery' - thoughts and analysis

Postby BBadger » Tue Feb 14, 2012 11:05 am

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