Co-written by:
Lenny Vance - President, SCEIA and Lecturer in Tourism and Event Management at University of the Sunshine Coast
Jakki Goodall - Business Development Manager, Hello Sunshine
At the Sunshine Coast Event Industry Association (SCEIA) recent industry forum the impact of the cost-of-living crisis on Sunshine Coast events was discussed by our panel of experts.
A question from the floor was raised. “Our event is a small community event (300 attendees to a ukulele festival) whose government funding is about to expire. We’ve never charged an entry fee. How do we put a price on entry without losing our audience?”
A summary of the response discussion was that it all comes down to the value proposition. Any event should not hesitate to charge fees – provided they are demonstrating value.
Let’s consider this concept of ‘price’ in a marketing context. Marketing, simply put, is an exchange of value according to Kotler (a godfather of marketing). If either the buyer or the seller do not perceive value, they will not participate in an exchange.
In an events context, the ‘product’ on offer is an experience. As event producers we are the architects of the experience that our audiences are looking for. And let’s not forget, our audiences are co-creators of those experiences – think a 300 strong ukulele jam!
So, what would an individual pay for that experience?
Let’s put aside the monetary cost of a ticket for a moment and consider the other costs for the buyer. Dedication of time and effort to purchase tickets, travel to the event, parking, camping, food and beverages, time away from home, family and/or work costs, the emotional costs (Am I a good enough ukulele player? Will the others judge or accept me? Should I buy a better ukulele?).
The temporal, physical and psychological costs accumulated across the entire customer journey start to mount up within the individual’s weighing up of the value proposition. They are asking themselves, during a cost-of-living crisis, are there more important things in my life to dedicate my time, effort and money to?
But humans are the most socially connected beings on the planet. The pent-up demand for socialisation coming out of the covid pandemic lockdowns exemplified this fact. This was a boost for our events industry that had literally been shut down during the pandemic. Although now the experiences market is highly competitive at a time when people are sensitive to living costs.
“Don’t underestimate the value of your experience” was the message from our panel. Your experience value is derived from social interactions that deliver conversations, fun, humour, mystery and knowledge exchange. The event experience should be creative, innovative and memorable allowing your audience to indulge in momentary conscious excess away from their everyday life.
Another key message from our panel was to be transparent in your pricing. Explain your justifications. Communicate how your audiences are buying into the capacity of your event to endure, and how they are part of the event’s community. Add the sense of ownership to the value proposition. Something the Woodford Folk Festival has so successfully done.
And continuously improving your value proposition is essential. Event organizers should be open to adapting it to fit the current economic environment. However, it's crucial to stay true to your core values. For instance, when Mark Pico from the Big Pineapple Festival suggested that selling alcohol could be a new revenue stream, the Ukulele Festival organizers remained steadfast in their decision to keep the event alcohol-free. Their priority was to maintain a focus on learning and playing music, rather than shifting the festival towards a party atmosphere.
Finally, be respectful in your ticket pricing. That is, respect your need as seller to extract value from the exchange, but respect the costs for your buyers to participate in the exchange.
What would you consider a fair price to pay in their circumstances?
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