Tickets may be $35 . . . but don't forget the money that is donated to the athletic department to earn the 'right' to pay $35/ticket.
https://www.lsutaf.org/images/CMS/Page/PageID 22/2-18-14 TAF Priority Points Procedures Revision(1).pdf
Having lived in the south - don't be fooled - the SEC teams are printing money through donations that doesn't even begin to approach anything that Purdue is doing. It's an eye-opening experience, that in the Big 10 is only remotely matched by OSU and Michigan.
As you mention, it has more to do with supply/demand than anything. There are some schools that get it, some do not. There are plenty of Big 10 schools that fundraise well. Wisconsin and Michigan bring in more than Alabama.
At many schools, there's a lack of parking, which makes it very lucrative to make a donation based on parking access - not necessarily tickets. But of course, the more people going to games, the more competitive parking is.
Penn State is a great example of supply/demand. Penn State's ticket revenue has remained fairly consistent - they're still selling similar amounts of tickets, but there isn't as strong of a demand. With that, there's less competition for seats, which means lower donations. Penn State has lost $10 million in donations, primarily seat related, over the last 3 years. No coincidence with less successful seasons.
This is why I think Morgan Burke's handling of Ross-Ade was one of his worst decisions. The notion of expanding to 80,000 was a pipe dream. There was no shred of evidence that Purdue could ever sustain that size of stadium. Even in 2000, Purdue did not sell out every game in a 67,000 seat stadium - and that was the most hyped Purdue team in decades. And when they renovated Ross-Ade, they should have fixed the south endzone problem then and there. Tear the crappy bleachers out and build a football facility there - that could have been phase 2, as long as the seats were out.
It's not just about ticket sales and having a huge capacity. When you have great demand - it drives up donations to get access to tickets and parking. Ten years ago, in 2015, Purdue was bringing in MORE donations than Oregon. In the last 10 years, Oregon has tripled that. Why? Because they've kept their stadium relatively the same size (50,000) and the demand has increased year after year. Increased demand means you have to donate more to get the tickets you want.