How to price your seminar or conference.

How To Price Your Seminar Or Conference

Seminar/conference marketers often ask two questions: What response rate should I expect on the marketing campaign I use to promote my seminars/conferences? What impact will an increase in my registration fee have on the response rate?

Let's take a look at some of the issues involved in answering these two questions by examining the data shown in the accompanying table. Using a scale of the number of people who attend per 1,000 brochures, let's compare two sample conferences, A and B. To promote Conference A, 61,500 brochures were mailed and attracted 164 attendees. In the case of Conference B, 67,950 were mailed and attracted 266 attendees.

For Conference A, 2.67 people registered for every 1,000 brochures mailed. For Conference B, 3.9 people registered for every 1,000 brochures mailed. (To arrive at this figure, divide the total number of brochures mailed by 1,000. Then divide that figure into the total number of attendees.) Which conference and response rate would you prefer?

You should select Conference A and its lower response rate. Conference A has a lower response rate but a higher registration fee ($495). Conference A is much more profitable than Conference B. As shown, Conference A's gross profit margin is 39 percent, while Conference B's gross profit margin is 20 percent.

Because of it's higher price, Conference A's promotional costs as a percentage of total revenue are lower than the promotional costs for Conference B. (To arrive at this figure, divide total promotional cost by total revenue.) Conference A's promotional costs are 20 percent of total revenue, while Conference B's promotional costs are 32 percent of total revenue - even though the response rate for Conference B is much higher.

As you can see, promotional cost as a percentage of total revenue is a more important variable to calculate than the response rate on direct mail campaigns. You should consider keeping promotional cost as a percentage of total revenue in the 20 percentile to 30 percentile range. As shown in the table, once promotional costs exceed 30 percent, gross profit as a percentage of total revenue declines dramatically.

How could you reduce Conference B's promotional cost as a percentage of total revenue and improve its profitability? There are three ways: