Sponsor Note: Thank TicketIQ, our longtime ticket sponsors, and specifically Greg Cohen, who's the reader there who's been like "I am throwing money at you; please write a Ticket Watch." Greg is also throwing money at YOU:

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The thing about TicketIQ is the price they say is the price you pay. This makes a big difference for an expensive game like this, because the fees get jacked. Small percentages turn into very large amounts of money quickly.

Anyway if you're going to buy a ticket on the secondary market, always try our friends first. Greg even said you can reach out to him personally at [email protected] if you find a better deal on the same seats.

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A funny thing happened for the Rose Bowl. When I last checked a few hours before the game there were still over 1600 seats available. And they were still--incredibly--priced in the $1400s. The way bowl game economics almost guarantees a shocking price when the market opens, a sharp rise as the people who just decided to go have to get their travel plans in order, and then an exponential downward slope to the finish as the brokers slowly fish for buyers.

The Rose Bowl was acting like that, then the prices went UP at the end. And yes, there were still empty seats, reportedly hundreds of them, at the Rose Bowl. Why this happened is an important question because it matters a great deal to how we strategize for the National Championship.

Because--oh yes--we are going to the ship.

Tag yourself

[After THE JUMP: How the system works, and why you're struggling to beat it].

CHAMPIONSHIP SEATS

I know it's counter-intuitive but we're RED on this map. Remember Roses are RED and Michigan beat Alabama in the ROSE Bowl.

It's not guaranteed but you're more likely to find seats sold by other Michigan fans in Michigan sections. Prices are about 10% higher on the Michigan side, which tells you what the difference in demand is.

Right now there are about 7,100 tickets, which Greg said is 200 off the high mark of the week. Inventory got as low as 4,400 on Wednesday, but the allotments have begun getting assigned, and 3,000 tickets hit the market over the last two days. Greg notes that most of the movement in price will happen with those middle seats; over the last two seasons the average price dropped about 5% between the Friday before the game and gameday, while the get-in price basically stayed flat over that same period.

HOW THEY FILL A NATIONAL CHAMPIONSHIP

The first thing you need to know is that the system is rigged against you. As you are probably aware to some degree, most of the seats for bowl/Playoff games are allotments to the teams that are going. The price is set based on what they think the market will bear, and the teams have to buy them at that price, so the only way you're going to this game on a ticket that hasn't already been purchased one time is if you're getting in on behalf of the school that got it for you.

Here's what those tickets look like coming out of the oven:

$475: Upper deck endzone
$575: Upper deck corner
$675: Upper deck sideline
$800: Upper deck middle
$900: Upper deck loge
$1,050: Lower Bowl Endzone
$1,300: Lower Bowl middle

STEP 1: THE SCHOOLS

The vast majority of tickets (there are always some VIPs: NCAA brass, some of host stadium's big whigs, etc.) are allotted to the schools, and we are told it's 50/50. First off, schools do NOT always purchase their entire allotments. In crappier bowls there's a minimum they have to buy, and they rarely buy more, but even in the big ones you'd be surprised how many get released back for the other team to increase their share. Alabama turned down about 15 percent of the tickets they could have purchased, according to our Rose Bowl guide, and this is pretty normal. Michigan had first right of refusal and jumped on them we were told, which was why both endzones seemed to be Michigan's.

They're on the hook for those seats, and they don't make much money selling them to their loyal customers. They do have to take care of *SOME* of their loyal season ticket holders, at least enough to create the appearance that being a season ticket holder can get you one of the good seats for the game. The few lucky people with loads of points and donations and regular appearances at things will get a chance to gobble up these seats at basically wholesale prices. They are good people to know too, because those are going to be most of the best seats.

Also, they just got their seats. People who put in through the athletic department have just started getting their assignments. They put in their credit cards, and Michigan took their money, but as of Thursday night the vast majority weren't issued yet, which means the fans themselves aren't participating in the secondary market at all.

Who is then? The brokers.

STEP 2: THE BROKERS

The mega brokers deal directly and often exclusively through the school, e.g. Michigan works with On Location (disclosure: an MGoBlog advertiser). About half of the seats in a game like this will end up in the hands of a few brokers in charge of disseminating the seats to the public.

You'd think if half of the building goes on sale at once the price would be much closer to will of the market, but you're forgetting a key ingredient: The sellers set the price. And if two or three entities are holding 30,000 seats between them, they have a lot of power to dictate what the buyers pay.

Because the secondary market is mostly driven by the get-in price, the brokers don't focus on plum seats. They do get chunks in all the sections, but a large swath of their share are the nosebleeds. These "consolidators" now get to operate a monopoly on the "I just want to get in for the lowest price" part of the fanbase, which is most of the fanbase. They set the price of the get-in as high as they can imagine (and they can imagine quite a bit), set the other sections super-high, then slowly drip-drip-drip those seats out through the ticket sites, who tack on crazy fees.

Brokers had the seats up for sale for awhile, because the same brokers do business with all of the schools that could be going. So you will see a few seats for sale from Texas fans and whatnot who jumped on broker seats in the last few weeks. But they were already in the same trap as you, several steps removed from the original ticket allotment.

Now before you go "That's Evil!" the brokers aren't getting that much from their seats; they're getting raked by the schools. Here's what those seats look like when they're picked up by the brokers.

• 6 seats in Section 618 Row L (goes up to N): $1,207.80 each
• 12 seats in Section 623 Row N: $1,313.20 each
• 8 seats in Section 607 Row M: $1,351.00 each

These are all upper-deck corner or endzone, almost to the top of the stadium, and there are rows upon rows of them. As a ticket broker, your job is to try to make your margins selling these at a markup until you take a loss on the rest. They're going to take a loss on some of them. But say they sell that group of 12 for $1600 today. That's a $3,441.60 profit, enough that could sell the rest at wholesale and not sell two of them at all and still turn a profit. Operating at these scales it's better to have a few unsold than to price too low. These are on TicketIQ right now, after fees. I can't guarantee they're the same seats we saw on the wholesale site:

Someone already picked up a pair of the 607 Row Ms. The group of 12 seems to have set the brokers back but they're a good gamble sometimes because big groups have few options. The more interesting action is on the markup for Section 607, which is on the 40 yard line, and considered an "A+ Deal" by the reseller's algorithm. That's because the math is saying the good seats will go first, while the bad seats are purposefully overpriced to inflate the whole market.

The steady flow keeps the market moving. Over the course of the week they drip-drip-drip tickets down so there's always something a little bit cheaper than the rest for someone to think "Oh, I just got the best deal!" What you've actually done is hit the edge of the iceberg and come away with a glass of meltwater.

STEP 3: THE FANS AND WHY THE ROSE WENT UP LATE

So you can see why we're all kind of in the same boat, even if we pour all the savviness we can into strategizing how to buy tickets.

Sometime soon if not already (they don't want it to be predictable) the fans who got their seats directly from the schools will begin to put them on the market. These will pop up in little bits, but every effort is taken to make sure they are not really competing on the same level as the brokers. If you list your tickets, depending on the site, you're acceding to the site getting a cut. You're also acceding whatever you've spent in donations and seat licenses to be in position to get those seats in the first place. And you probably weren't getting them to

Those seats are a commodity though, which is the one thing Team Buyers has going for us. Until a minute before kickoff they have a thing we want. Once the sites stop selling the sellers eat the overhead. And because of this the advice for every bowl game I've heard a thousand times is WAIT WAIT WAIT YOU DUMMY WAIT. I was saying the same for the Rose tickets, and so were people who know a lot more than I do.

Working against us is, well, us. We're not one entity; we're all competing for a seat, and a lot of us are making our travel plans contingent on getting something affordable. But in the case of Michigan fans--and here's where I think I went wrong with the Rose Bowl--we're a savvy bunch. I mean, our biggest website has a column devoted to ticket economics. We've been going to bowl games (at least some of us; I haven't been to many) for years, and know the WAIT YOU DUMMY strategy better than most. And Alabama fans have been to these big-ticket neutral games dozens of times. So you've got two fanbases who've trained their brains to do the smart thing and wait until gameday to buy their tickets on the secondary market, and what happens: They get to gameday and it's a seller's market!

My best guess as to what happened was a lot of smart fans decided to wait until the last minute, and that kept the get-in market dripping at its drippy pace right up until gametime. This resulted in lots of inventory left at the end, which should have depressed the market, but such high returns on all the seats the brokers sold that there was no point in crashing the market at the end just to chase the final bits. Using our glacier analogy: they had it priced to run out of ice at kickoff, but with fans removing the meltwater so quickly it never actually got to the drop.

Alabama's behavior also may have created an extra glut of secondary tickets. Rather than opening more seats to their season ticket list I believe Michigan chose to gamble they could make some extra money on the wholesale market, and did so. This meant a greater portion of seats than usual were frozen behind the monopolistic price wall, with a smaller proportion for the fans to be trading. Even a little p2p trading can really move the market, usually downwards.

WHY THIS MIGHT NOT BE THE ROSE BOWL

1. That was a unique game that combined the Rose Bowl, Alabama, and starved Michigan fans. It ended up being one of the greatest games of the century at the greatest football venue in the land.

2. There isn't a month to get tickets. Most of the people going to the Rose Bowl got their tickets squared away in early December, and then a small portion of the stadium was still trading for the next few weeks. For this one everybody's jumping in together, including the sellers. The wider the market, the more reactive to market forces it has to be, and that favors the side that isn't trying to game the market, IE us.

3. Flights are the real bottleneck for this one. That wasn't the case for the last one. The Rose Bowl was on a national holiday, with the kids on Christmas Break for the week before (and in many cases after). Fans were able to spread out their trips, stay further from the stadium, choose from more local airports, and fly in and out on many different days. With this game you had a glut of people booking a finite number of specific flights and trying to make it work for a Monday night of a work week. Whatever glow the Natty has over the Rose, adding work days when you just came off break to a trip to Houston is not the same as vacationing in LA the last week of December.

Adding to this: there aren't as many Michigan fans in Houston. LA has a massive Michigan presence, which we point out every time the basketball team gets seeded in the Pacific bracket, and all of those people were immune to the flight situation. We do have fans in driving range of Houston--they're everywhere--but if MGoBlog readership is any indication of where Michigan fans live, the Southern California contingent is more than three times that of Houston-DFW-Austin combined (which is a much wider area). LA vs Houston is 8-to-1.

4. The last one was for pleasure; this time we're here on business. There were plenty of younger fans at the Rose Bowl. Not a huge one, but more than at any rivalry game in Ann Arbor the last few years. I think the parties shrank with this one as kids were back in school, and there wasn't a Disneyland nearby to make it a trip. Seats are selling in 2s and 3s, not 4s and 6s.

STRATEGY?

I think you can wait for them to come down. I'm less certain than I used to be, and keep in mind that the brokers are better at getting their margins than you are at getting them to feel desperate. If you can stomach it, buy on Monday afternoon. In the meantime, keep watching TicketIQ (don't forget your $100 off code) and our message board, and make sure you're in good with that uncle who always gets seats for things.