Professional Documents
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An important thing to note is that the homecoming game of every season is the second home
game (bold), and is always well attended. Also the forth home game always corresponds with a
local festival that always draws from attendance (italics).
Anthony Lawrence
Nave
Moving Average
(3 periods)
Weighted Moving Average
(3 period; .6, .3, .1)
Exponential smoothing
(alpha = 0.5)
Trend Analysis
Seasonal Additive
Decomposition
Correlatio
n
--
Bias
MAD
MSE
MAPE
541.38
6865.52
69,856,200
.19
--
491.36
6,138.27
59,540,560
.17
--
424.81
6,501.58
61,107,180
.18
--
794.28
5,880.56
50,755,960
.16
.54
0.00
4,355.70
31,285,700
.12
.97
0.00
1,251.26
2,386,650
.03
It is obvious that the superior method is seasonal additive decomposition. This makes
sense because of the cyclical nature each season follows, largely due to the homecoming
game and local festival. The other methods cannot take those variations into account,
and this adversely affects their error. Because of this they are not suitable for predicting
at which point the demand of attendance will surpass the stadiums capacity. They will
show when the average or smoothed demand will reach capacity, but this will occur after
attendance for one or two games will consistently surpass capacity.
Seasonal additive decomposition is definitely the best method, and all indications
support that. The bias for trend analysis is just the same as seasonal, however the
correlation coefficient is not acceptable for this method, well below .70, but the seasonal
correlation is outstanding at .97.
So, now the management has a decision to make whether or not it is worth putting off
expansion of the stadium until the average attendance of a season is above capacity, and
losing potential ticket sales for the games that are above capacity, or to go ahead and
expand before capacity is ever reached in a single game.
Anthony Lawrence
Forecasting: The following table shows the forecasted attendance of the next two
seasons of home games.
Game
2008 1
2008 2
2008 3
2008 4
2008 5
2009 1
2009 2
2009 3
2009 4
2009 5
Attendanc
e
46540.23
52555.73
50254.56
38370.06
50202.22
48784.39
54799.89
52498.72
40614.22
52446.38
According to this analysis, the second game of 2009, the homecoming game, will be the
first game that the demand for attendance will exceed capacity. The management can
wait until after the 2008 season to start the completion, so long as it is completed before
the 2009 season starts. One thing they should consider is that a refurbished stadium
would cause a spike in attendance because fans would want to see and experience the
new facilities. With this in mind, these figures could be much lower than what would
actually happen if an expansion were built.
Revenues: Ticket sales will average $20 in 2008 and $21 in 2009 due to a 5% price
increase. Total sales can be found for each season by summing the attendance from each
game and multiplying by the ticket price. The results are displayed in the table below.
Season
2008
2009
Total Attendance
237,922.8
249,143.6
Revenue
$4,758,456
$5,232,016
Again, it should be emphasized that depending on when the expansion is built, these
values could be lower than what actually comes in. It would be smart for them to build
the expansion sooner than later, so that the spike in ticket sales will come sooner. This
could offset some extra costs that could incur from building it sooner.