Choosing the Right Conference Pricing Strategy
After months of planning and discussion, you are finally ready to market your conference publicly. You’ve studied your target market and customized your event to meet their needs. The only thing left is to decide is how much you will charge attendees.
This is a big decision because if the price is too high then you risk missing your attendance numbers. On the hand, if you don’t clear enough after costs then even a small crisis could turn the entire venture into a loss.
It is a slippery slope to walk, which is why you’ll want to study the different pricing strategies outlined below and choose one that provides the best solution for your market.
The Retail Approach
The most basic pricing strategy is to calculate expenses, add a profit margin and then divide the sum by the lowest projected attendance figure. There’s nothing wrong with this strategy, as it has been the formula used by retail stores for hundreds of years, but it does require accurate projections. Things like venue rental and audio/visual costs won’t change regardless of how many people attend, but food costs and other per person fees will. This is where your projected minimums are essential because they will ultimately cover your fixed costs.
When you base your conference fees on the market you are essentially playing with a vision of what people can afford. It is the opposite of the retail approach since it begins with setting the price of admission and then working backward to build the conference within that budget.
One thing to keep in mind with market pricing is that it is based on perceived value. In other words, attendees are not going to hand over their money simply because you are having an event. You must provide exceptional value or else you will struggle to sell tickets at any price.
Limited Access Pricing
This is a tiered pricing model that offers more features and benefits to those who pay more.
For example, a basic ticket might admit someone to the main general session and breakouts. The next tier would provide all this plus a seat at the keynote luncheon. The VIP ticket would include preferred seating at all events and access to an exclusive break room and post-event networking function. Again, the key to success is creating enough value in each tier to generate sufficient demand.
Incentives and Penalties
You can use incentives and penalties to encourage registration within a specific time period. You have probably seen “early bird” registration offers at many of the events you have attended. The goal of these promotions is to cover all of your fixed costs early so that you aren’t scrambling to raise money near the end. Penalties or late registration fees are almost essential if you are serving food because most catering contracts include surcharges for orders placed after the final guarantee date. Make sure to explain this to late registrants, since often times they feel manipulated by penalties when in reality the additional fee is enforced only to cover your costs.
A popular idea in the internet age is to offer online access to a recorded version of your conference sessions, but be aware that this strategy has the potential to affect your marketing efforts.
There will be some prospective attendees who, after discovering the sessions will be recorded, won’t feel motivated to attend the live event. Your organization will also incur costs for recording equipment, website management, and hosting fees. For these reasons, it is better to limit online access to attendees only or charge a substantial fee for non-participant access. At the end of the day, recording and posting videos of conference sessions cost money, so don’t feel obligated to give this material away.
The two most important numbers for determining your conference pricing strategy will be the anticipated costs and attendance estimates. Without these projections, it will be difficult to choose a pricing model that best fits your organization and attendees. Give yourself plenty of time to research these two figures before determining your pricing model.