How much should you charge for tickets to your events? That’s the million dollar question, right? Unfortunately, there isn’t a single formula to calculate the perfect ticket prices for every event. There are simply too many variables that are unique to different events like location, time of year, weather, performers, venue, competition, and so on. However, that doesn’t mean you can’t use some pricing strategies to come up with event ticket prices that will help you sell the most tickets possible.
I’ve been in marketing for a very long time, and AttendStar President Gary Bradshaw has been in the event and ticket selling industry for a very long time. Together, we know our stuff when it comes to pricing, and I’m sharing some of the secrets that marketing and event pros use to set their ticket prices for maximum return on their investments.
5 Steps to Set Your Event Ticket Prices
For most event organizers, you need to make sure you make money on your events (or at least break even), so you can hold additional events in the future. That means you need to find the sweet spot between making the ticket price affordable and making it profitable while keeping in mind that people equate quality (or popularity) with price.
AttendStar President Gary Bradshaw explains, “I once did a test and sold $5.00 tickets for an artist in several markets. Then, I sold $15.00 tickets for the same artist in other markets. In every case, the $15.00 markets sold more tickets.”
Cheap tickets aren’t enough. You need to give people a reason to buy. We’ll talk more about that later in this article. For now, let’s take a look at how you can find the average ticket price point for your event.
1. Determine Your Breakeven Point
Before you do anything else, you need to add up all of the expenses you’ll incur to hold your event. This is your breakeven point. If you don’t make this amount of money on ticket sales, you’ll lose money on the event.
Make sure you include your marketing budget, because skimping on your marketing budget to reduce your ticket costs will likely cause you to sell fewer tickets. As Gary says, “You can’t have it cheap and well-advertised!”
2. Identify a Realistic Ticket Sales Quantity
Next, you need to determine a realistic number of tickets you can sell. If your venue holds 500 people, is it realistic that you could fill the venue with people who want to attend your event? Finding this quantity will take a bit of work on your part to determine if you have a large enough audience to actually sell the number of tickets you hope to sell. Remember, being realistic is critical at this point.
Once you identify the number of tickets you think you can sell, it’s time to get out your calculator. Divide your breakeven point from Step 1 by your forecasted ticket sales quantity. The result is the lowest price you can sell tickets for in order to break even.
Next, determine how much profit you’d like to make on the event. Add that to your breakeven point and divide the sum by your forecasted ticket sales quantity. This is the minimum ticket price you’d need to charge in order to hit your desired profits. Once you have these two numbers, you can determine how you want to set your ticket prices. However, you need to do some research first!
3. Research Similar Events
What do tickets to similar events cost? Be sure to research events that are actually well-attended. It doesn’t matter what price a ticket costs if no one went to the event! Look for events with similar venues, performers or speakers, and so on.
You’re trying to compare apples to apples at this point. Are the ticket prices you came up with in Step 2 appropriate based on similar events? You might have to make some adjustments if your pricing isn’t realistic.
4. Research Competitor Events
Next, you need to research competitor events. This includes not just events like yours but also other events and activities that people could choose to do or spend their money on rather than your event. For example, ask yourself what else is going on in your town that could compete with your local event.
This is where the concept of perceived value is so important and why it’s critical that you write effective messaging to promote your event. No one cares how much time and money you invested into the event. All they care about is if the price of the ticket is less than or equal to the benefits they receive by taking time out of their day and money out of their wallets to attend the event. They’ll compare your event to other options and are likely to choose the one that has the greatest perceived value. It’s up to you to ensure they believe your event delivers the best value proposition to them.
Based on your calculations and research, could the perceived value of your event (if you market it appropriately) exceed other events? Is it less than or equal to those other events in perceived value?
Your price should be lower, the same, or higher based on that honest evaluation. Use this pricing information along with your minimum ticket price calculation results to set your base ticket prices.
10 Pricing Strategies to Maximize Ticket Sales
Once your base ticket prices are set, it’s time to get creative! Use the 10 pricing strategies below to make your price and tickets as attractive to your audience as possible.
1. Early Bird Pricing
Early bird pricing is so important to boost early ticket sales that not only get you in the black sooner but also generate valuable word-of-mouth marketing! Lower your ticket price well before your event and offer that low price as a limited time offer. You can follow the link to learn more about early bird pricing.
2. Timed Batch Ticket Pricing
With timed batch ticket pricing, you release batches of tickets on specific dates (or at specific milestones) with increasing prices as the event gets closer. This helps to boost early ticket sales and creates a sense of urgency well in advance of your event.
If you use this pricing strategy, keep the psychological principle called Weber’s Law in mind, which tells us a just noticeable difference (JND) between two stimuli is directly proportional to the magnitude of the stimuli. In other words, a change in your ticket sales will be affected by how much the price was before the increase. Weber’s Law shows that customers are usually motivated to respond when the price increase is an average of 10%.
3. Odd/Even Pricing
This is one of the oldest pricing tricks that has been well researched and discussed in marketing journals. On average, prices that end with a nine (or even a five) outperform lower prices that end in other numbers, particularly even numbers. However, prices with a nine at the end typically perform better than any others – even against lower prices!
Research has shown that prices with even numbers as the last number are generally perceived psychologically as having higher quality. Although odd pricing can increase sales, you might want to consider this when you set your prices depending on the perception you’re trying to create for your brand.
4. Bundled Pricing
Consumers love bundles where they feel like they’re getting more for their money. Research has even shown that consumers prefer getting extra things added into their purchases for the same price (e.g., buy one get one free) to getting a price discount. You can do this by adding extras like a VIP experience, parking, food, and so on to some or all of your ticket prices.
5. Partitioned Pricing
Should you include the fees in your ticket prices or not? The answer to this question depends on whether or not you’re selling tickets through different distribution points. For example, if you’re selling tickets online, offline, and at the door, it’s important to keep all ticket prices the same so more people are encouraged to purchase tickets online.
Gary explains, “If you sell tickets at a lower price offline, then you’ll lose online sales. That means you also lose the chance to collect buyers’ email addresses for future marketing, and you won’t be able to create the same level of motivation to buy tickets in advance, which can hurt your ability to put your event in the black as soon as possible.”
Things are a bit different if you’re only selling tickets online. Based on the partitioned pricing strategy, you should keep fees separate (think of airlines, which have spent years and millions of dollars finding the best ways to present their fees) and advertise your prices without the fees included. This is a lesson StubHub learned in 2015. The company had switched to setting prices that included fees less than two years earlier but reverted back to partitioned pricing when sales plummeted.
Why does partitioned pricing work? The reason is because people use that advertised price for comparison shopping. Also, once they’ve made the decision to buy a ticket, they’re less likely to abandon the purchase when they see the fees added later (unless the fees are excessive).
6. Tiered Pricing
Price anchoring is a pricing strategy that says you should display the product you want to sell at the price you want to sell it next to similar products at different price points in order to increase sales of the first product. The reason is because people rely more heavily on the first piece of information given to them when they make decisions. That means a $10 ticket is more likely to sell if it’s seen next to a $100 ticket because of cognitive bias.
However, don’t offer too many pricing tiers, or consumers will become confused and not buy at all. Of course, each tier should offer the right perceived value to match the price tag. Research has shown that if you’re offering three tiers, the ticket price you want to sell the most (e.g., the ticket price that will enable you to hit your profit goals) should be the middle price to provide the best price anchors.
7. The Law of Fewer Numbers
Simple prices work better than complicated prices. For example, research published in the Journal of Consumer Psychology showed that leaving out cents and commas can increase sales. The longer the price looked or the longer it took to say the price in a person’s head, the fewer the sales.
With this in mind, avoid displaying your ticket price as $10.00. Use $10 instead. For larger numbers like $1,199.00, use $1199 instead.
8. The Rule of 100
The Rule of 100 says that when you’re discounting your prices, size matters. In other words, bigger numbers are perceived as having a higher value, even if they’re not actually bigger discounts. Therefore, for any ticket prices under $100, show the discount as a percentage, but for ticket prices over $100, show the discount as a dollar amount.
For example, if you’re selling a $20 ticket at a 20% discount, the actual discount would only be $4. Which is likely to be perceived as delivering a greater value – 20% or $4? However, if you’re selling a $200 ticket at a 20% discount, the actual discount would be $40. Which is likely to be perceived as delivering a greater value – 20% or $40? Based on the Rule of 100, the 20% discount is perceived as a better value for the $20 while the $40 discount is perceived as a higher value for the $200 ticket.
Rather than offering everything upfront and increasing the total purchase price, you can upsell-post-purchase. To get started, ask yourself some questions. What happens when someone buys a ticket from you? Are they given opportunities to add on additional products or services? If they didn’t purchase parking yet, do you remind them they can do so in advance – right now? Do you give them a chance to buy food credits, upgraded seating, or other perks? If not, you’re losing opportunities to make money on every ticket buyer!
Once someone makes a purchase, they’re far more likely to buy more. If you’re selling tickets online, you should offer upsell items immediately after they make a purchase. If you’re selling tickets offline, every ticket sales agent should ask every customer if he or she would like to purchase one of your upsell items. The key is to increase per-customer sales!
Most sellers list their ticket price tiers on their ticket sales pages with the lowest price first. However, the pricing tactic of priming says you should list your most expensive prices first.
Remember what I mentioned earlier in this article about cognitive bias? People are most likely to make decisions based on the first information they see or hear. As long as your higher priced ticket tiers aren’t outrageously expensive, showing them first should increase sales for those tiers.
Furthermore, just as restaurants show a pricey anchor dish to prime their menus and make other items look like better deals, you can do the same with your ticket prices to make the tiers you want to sell the most look like great deals that deliver amazing value.
Your Next Steps
Once you’ve done your research and identified your prices and pricing strategies, it’s time to start testing. Remember, there are so many variables at play with events that no two are the same. You really do need to test to see what your audiences respond to the best.
“When you charge more, deliver more,” says Gary. “Don’t let your own emotion play a part in setting ticket prices, and don’t let your own passion for the performer, speaker, or event play a part in performer or speaker selection or ticket price.”
Also, you need to ensure your marketing materials, advertising, and event ticket sales page are extremely well written with messaging that creates the right perceived value for your event in consumers’ minds. Hype the benefits of your event and create messages that reduce your audience’s pain points. Tap into their emotions by selling the experience, not the price!