Ever wondered what you should price your entry level/preview in person events at?
I was speaking with one of my colleagues the other day, who despite his recommendation to his client, they were trying to fill a $3000 event with cold traffic (people who had never heard of this business before).
I don’t know about you, but I’m not spending $3000 with someone from a Facebook ad that I have never met or spoken to.
If you already have a relationship with your list/prospects that haven’t bought from you before, you may be able to get away with this, but most probably not.
So, what is the best price point for your entry-level events?
We’ve worked with clients who have their preview events at $0/free.
Then we have clients who have held these types of events for $27, $47, $97, $197 and $497….
So what’s the right option for you?
That is a very good question.
To determine this, you’ve really got to know your numbers and know what you want to achieve out of running this event.
Here are some questions to get you thinking:
- What’s your cost of acquisition?
- What’s the cost of putting the event on?
- What’s your offer at the event?
- What’s your current conversion rate at this event?
- How many people do you need in the room?
- How many people do you need to convert in the room?
- What’s your typical event revenue?
- What’s the lifetime value of a customer?
- What would your target market be willing to pay?
We’ve had clients who for a long time ran free events, then they moved to a low cost preview event. They did this to help qualify these leads better and see if on the backend that would get a higher conversion (plus help cover the advertising costs).
We’ve also had clients who have done a combination, they run a free event and also offer a VIP option (which includes at the front seating, networking opportunities etc.).
There are pros and cons for free vs paid preview events.
The Pros of Paid Preview Events – If you’re looking at charging, bringing in some revenue from event sales does help cover the cost of acquisition and related event costs for sure. Also, the fact that people have some skin of money in the game, then in theory it should motivate them to show up (you’d think right?!).
The Pros of Free Preview Events – However, in terms of running a free event, this lowers the barrier of entry so it’s accessible to greater number of people. Also it could be more of a compelling offer, particularly if your competitors are also offering a free event option.
Here’s the thing, if it costs you $25,000 to put on the event, pay for advertising etc. and you bring on 5 new members to your program and the lifetime value of a client is $15,000, is it worth it? So you’ll roughly bring in $75,000 from this event based on your averages. You’d probably say yes right?!?!
So should you charge?
I’d be asking did you charge previously to get those results, were you happy with the quality of leads in the room, did you achieve your goals from this event?
We don’t recommend changing your event pricing strategy unless it’s really not working. But let’s be honest here, it may not be a price issue it could be a value proposition issue. Your prospects may not see the value in paying and/or attending and/or signing up (and the list goes on).
Events are complex and there are so many factors that impact the result.
Don’t be too quick to jump to conclusions as well, you don’t want to get a reputation out there that you keep changing your offer (unless of course it’s failing miserably).
Run it at a certain price/free for a period of time and track how this goes.
Test it, monitor your results and identify ways you can further improve.