Figuring out pricing is an integral part of the event planning process. In this article, you will learn the steps you need to take to determine how much to charge for events and the different pricing options.
As an event organizer, you already know that attendance can make or break the success of your event. Ticket sales are the single biggest source of revenue for events. So, that's why it is critical that you learn how to develop a pricing strategy that will make people want to attend your events repeatedly.
The good news is that pricing an event doesn’t have to be rocket science. In this article, we will demystify the art of pricing and developing packages for your events.
Determine the total cost it takes to plan the event
The first step you need to determine is the cost it will take to host the event. You will need to look at everything from the cost of catering, previous attendance rates, how many people you want to attend, A\V needs, technology support, gifts, speaker fees, venue costs, and marketing materials. Estimating expenses is essential when planning an event.
Set profit goals per person
Now that you’ve estimated the overall expenses it will take to execute your event, look at your variable and fixed expenses to calculate the total cost per person to plan your event. Variable expenses like food and labor are subject to change, but you can project a ballpark range per person for your event.
This will help build the framework for your goals and objectives. Add the total cost of the food, venue, entertainment, and misc. expenses together and divide that number by the amount of people you want to attend.
That will tell you the average cost for each attendee. Next, you’ll need to determine how much profit you want to make from the event to set your break-even point. Your goals and objectives for the event should be targeted per person to make sure to stay on track throughout the planning process.
Review your annual budget
Planning multiple events in one year? Then your next step is reviewing the annual budget. Each event should ladder-back up to the annual budget. So it’s essential that you consider the bigger picture when figuring out expenses and revenue targets.
Identify how many tickets you actually can sell
The one mistake many event organizers make is over-projecting ticket sales. So it's imperative that you set a realistic number for the amount of tickets you can sell. Can you sell out your entire event venue?
If your event venue holds 800, do you have the marketing tactics in place to guarantee that all those people attend? Once you’ve identified the number of people you want to reach, divide your break-even point by the number of tickets you plan to sell.
This will determine the lowest amount you can charge for tickets to break-even. Now you need to decide how much you want to charge to make a profit. Add the amount you want to make to your break-even point and divide the total by your forecasted ticket sales quantity. Once you have both of those numbers figured out, you can start pricing your ticket packages.
Review similar industry events
It’s also a great idea to scout the prices of similar industry events in the area when building your own pricing strategy. For example, see what the cost was for previous events held at your venue. You want to make sure your ticket prices are realistic but also competitive with the industry standard.
Pricing Strategies to Increase Ticket Sales
Once you’ve determined the core ticket price, it’s time to start building your pricing structure. Let’s take a look at pricing tiers that work well to increase attendance.
- Advanced and Early Bird Packages
Early bird pricing is a great way to increase ticket sales early on. By offering a limited time discount, you're attracting the attendees that are eager to attend and save money. Give early bird registrants 10-20 percent discount off the base price. Adding a time limit to the early-bird price creates a sense of urgency in advance of the event. A powerful event management platform will help you generate early bird packages without breaking a sweat.
- Group packages
Group ticket pricing attracts larger groups where an entire team is planning to attend rather than one individual person. Offering a group rate incentivizes larger companies to save money on tickets by paying for a package deal. Depending on the size of your event you can provide more than one type of group package. Offer one group rate for a group of five and offer another for a group of six or more. Pricing group packages by business size helps increase the chances of ticket sales.
- Sponsor discount packages
A great way to generate word of mouth about your event is to offer sponsors and their audiences a discount. You should provide your sponsors with a discount code for a limited period that they can share on social media and email. This will generate buzz about your event and reach new audiences. The sponsor discount codes are usually 10 percent off the early bird price.
- Elite packages
There is a growing demand for VIP experiences at events. Offering a marked up rate that provides a little something extra like passes to a happy hour or exclusive keynote is a great way to engage with the luxury enthusiast but also make more money. The person looking for an added value will pay the higher price for an experiential experience.
- Limited attendance packages
Offering single-day or half-day packages allow the person who wants to attend but can’t stay for the entire time the opportunity to experience the event. This is becoming more popular for multiple day conferences and events. The limited attendance pass should be priced at a slightly higher cost than the rate for per day for a multi-day pass.
- On-site registration
After the online registration period closes, you may want to offer on-site ticket sales at a higher cost. On-site registration costs are usually priced 10-20 percent higher than the final rate. This encourages people to register early but also accommodates that last minute ticket buyer that eagerly wants to attend.
Event pricing is crucial to the success of your overall strategy. Remember to price with attendees in mind and set realistic expectations. Set your targeted revenue goals and keep track of all expenses. Finally, continue to monitor the progress of ticket sales and remember it’s okay to pivot along the way.