Pricing is often the toughest part of organising an event. Most people go down one of two routes.
- Cost-plus pricing - a price above the cost, so if it will cost you £20 per person to hold the event you charge £x above that to make profit.
- Competitive pricing - looking at what similar events are charging and pricing comparatively to that.
These both have advantages and disadvantages but they both make one big error, which is to ignore the needs of the customers. Until you have loyalty or have built a brand that is respected and known you need to employ value-based pricing. Which is the amount that your customers are willing to pay.
The amount a customer is willing to pay, is the perceived value of the event; what the customer thinks they are getting out of the event. This can often be higher or lower than the actual price.
You want the perceived value to be as close as you can to the actual price and not lower. You want to create a sweet spot where by the customer has placed a higher value on the event than the ticket price. That feeling drives sales and if your cost per ticket is lower than that, you have made profit.
So what do I need to do in 5 steps:
- Think about what you are offering in a critical way, evaluate it, is it the best it can be? How much does the event actually cost?
- Using your evaluation settle on the proposed ticket price.
- Create your description to sell that event to your customer.
- Get feedback from people you know friends, colleagues, family. Ask them based on the description and the event itself how much they would be willing to pay.
- Re-evaluate based on their feedback and finalise price.
Remember to get feedback from customers after the event and to be always adapting and changing.