Setting prices for a nonprofit fundraising event can be challenging, as you need to balance your fundraising goals, your audience's expectations, and your event's value proposition. How can you determine the optimal price point that maximizes your revenue, attendance, and impact? Here are some key considerations to keep in mind.
Before you can set a price, you need to know how much it costs to host your event. This includes both fixed and variable costs, such as venue rental, catering, entertainment, marketing, staff, and supplies. You also need to factor in any discounts, subsidies, or sponsorships that reduce your expenses. Your total costs will help you calculate your break-even point, which is the minimum amount of revenue you need to cover your costs.
the cost of a fundraising event is lost time for staff, agita for the donor - you want to save money on events - get rid of them - totally - focus on major gif cultivation, solicitation and stewardship.
The ticket price of a fundraising event is a combination of two amounts 1) the fair market value of the ticket (quid pro quo) and 2) the charitable contribution amount. The charitable contribution amount is the amount an attendee is willing to pay in excess of the fair market value. The amount in excess of the fair market value is the amount the donor may take as a charitable contribution, assuming they are an individual who itemizes on their personal tax return. The quid pro quo should be clearly stated on the ticket. This is the fair market value, or what a person would pay to attend a similar dinner, concert, golf event, etc. The quid pro quo is not necessarily the cost the organization incurred to put on the event.
In my experience, you need to have a healthy balance between how much money you want to raise versus your event costs. If you will end up spending more than you will "earn" then it would be wise to consider getting a sponsor for your event first or finding a cheaper event so that the gains are more.
Like any business venture, fundraising events should ideally be backed by a list of investing partners (or sponsors) who can help cover the logistical costs of the event and contribute to the experience or attendance needed. Strong partnerships are critical for event based fundraising and can provide clear ROI and an increase in brand affinity for the investor.
Expense management is critical to the credibility and viability of every fundraising event. But creating a new "fundraising brand" that has the potential to be an annual success and live on as an evergreen source of revenue requires an "investment mindset". For example the Princess Margaret Ride to Conquer Cancer is a multi year success story which will likely raise $300 million just in Toronto since its launch. The board and staff of PMCF built an "investment brand plan" before its launch and millions of dollars were committed to building this brand. An event is different. Events that have limited lifetime potential need strict return to charity management of expenses. That's why I have never been a fan of traditional "Galas".
Your price should also reflect your target audience's willingness and ability to pay. You can research your audience's demographics, preferences, and past behavior to estimate how much they value your event and how much they can afford. You can also use surveys, focus groups, or interviews to gather feedback from potential attendees or donors. Your audience's perception of your event's quality, relevance, and impact will influence their decision to buy a ticket or make a donation.
Duncan Tree Foundation, the charity I founded and have led since 2008, has organized and hosted many fundraising events. The first consideration as it pertains to pricing is the community we wish to serve, who in our network cares about this community, what they can afford based on their tax bracket, and what would be a reasonable cover charge for the ticket price keeping potential sponsorships to offset out-of-pocket costs, and the net amount we wish to raise for various projects in mind.
Your ideal attendees dictate what they are willing to pay -Demographics matter, consider their age, income level, and location. These influence their spending habits. -Tap into interests that align your event with their passions and how deeply connected they are to your cause. People pay more for what they value. -Understand price sensitivities, what are comparable events priced at? Are there financial barriers you can address (payment plans, scholarships)? With a very price-sensitive crowd you can also look into corporate sponsorship to mitigate individual ticket cost. Knowing your audience ensures you do not underprice (leaving money on the table) or overprice (excluding potential attendees).
Consider the event's fundraising goal, budget for expenses, and the target audience's capacity to contribute. Factor in venue costs, promotional expenses, and logistics. Align pricing with the perceived value of the event, balancing affordability and the potential for significant donations. Offer different ticket tiers to accommodate diverse budgets. Prioritize transparency in communicating how funds will be used, fostering trust among participants and increasing the event's appeal. Regularly evaluate and adjust pricing strategies based on feedback and fundraising objectives.
Have a pricing policy that reflects the different roles of staff, general volunteer, event volunteer, (former) client, funder, Board member, and general public, to name a few.
Consider different fundraising events for different donation abilities. A mail campaign may be better for those with low level donation capabilities, an elite level box at a sporting event may bring in high level donors, and a large scale event like a banquet or gala with silent auction may hit your mid-range donors just right.
Your price should also communicate your value proposition, which is the unique benefit that your event offers to your audience and your cause. Your value proposition should answer the question: why should someone attend or support your event? You can use storytelling, testimonials, or impact statements to showcase your value proposition and create an emotional connection with your audience. Your value proposition should also differentiate your event from other alternatives or competitors in the market.
Consider also the hidden value of the event. Many fundraising events actually lose money, particularly when the costs of staff time are included (which they typically are not). But even an event that loses money can add value if it creates the opportunity for having a conversation with existing or potential donors.
Exemptions to any pricing for clients of the non profit, to participate equally in the event. Fundraisers are great, but often they're exclusionary to those that are supposed to benefit and may establish an unintended division of Class.
It is the law of supply and demand. One must test the demand and officer accordingly In this sense, tier pricing could apply
Your price should also align with your overall fundraising strategy and objectives. You need to consider how your price affects your revenue, attendance, and impact goals. You also need to consider how your price fits into your marketing mix, which includes the product, place, promotion, and people elements of your event. You can use different pricing strategies, such as cost-based, value-based, or market-based, to optimize your price according to your strategy.
Remember that if people buy a ticket they might think they are already contributing and you might loose a potential bigger donation. In my Gala events I don't sell tickets, but people know that if they go, they will donate one way or another. Donations are always bigger.
One key consideration is to understand the value proposition of your event. Are attendees receiving tangible benefits, such as meals or entertainment, that justify a higher price? Or is the main draw the opportunity to support your cause, which may warrant a lower price point? Understanding the value your event offers can help you determine an appropriate price. Additionally, consider your target audience and their willingness to pay. Overall, setting prices for a fundraising event requires careful consideration of your goals, audience, and value proposition. By aligning your pricing strategy with your overall strategy, you can optimize your pricing to maximize revenue and impact for your organization.
Your price does not have to be a single fixed amount. You can use different pricing options, such as tiered, bundled, or dynamic pricing, to offer more flexibility and choice to your audience. You can also use pricing tactics, such as early-bird, referral, or loyalty discounts, to incentivize or reward certain behaviors or segments. You can also use pricing experiments, such as A/B testing or split testing, to test and compare different prices and measure their effects on your outcomes.
Tiered prices with small incentives bring in much more income. In one working-class community I urged the art gallery to test gold tickets at twice the price of the regular tickets. They were skeptical, but I pointed out they had nothing to lose if no one bought any. Later they reported that every lawyer in town wanted to be seen at a gold table! (They also complained that gold table cloths were hard to find.) If you want to offer low price tickets for poorer people, students, etc. instead of discounts ask donors to subsidize them. One feminist event priced tickets for women at 75% of tickets for men, to reflect the pay difference.
It’s a fundraising event. The idea is to raise as much money as possible. The event has to be special and a must to attend. Aim at the high end. Go for gold
Your price is not set in stone. You can monitor and evaluate your results and adjust your price accordingly. You can use metrics, such as ticket sales, donations, attendance, satisfaction, retention, and referrals, to measure your performance and impact. You can also use feedback, such as surveys, reviews, or testimonials, to understand your audience's experience and perception of your event and its value. You can use this data and insights to improve your pricing decisions and optimize your results.
When pricing tickets for your nonprofit fundraiser, consider your financial goals, event expenses, and the value you offer attendees. Understand your audience's budget and offer competitive prices. Highlight the event's value with special guests or activities. Look at similar events for pricing guidance. Offer early bird and group discounts. Be transparent about where proceeds go. Remain flexible and adjust prices based on demand.
In addition to what has been discussed above you can look to -Leverage volunteers, their time has value. A well-run event with volunteer support justifies higher ticket prices and enhances the guest experience, while reducing cost. -Seek in-kind contributions (like food or venue space) to offset your costs. -Use pricing psychology, employ tricks like odd-even pricing ($99 vs. $100) or price anchoring (multiple tiers) to influence attendee perception of value. -Think long-term, your current pricing impacts future events. Setting prices too low now can make it difficult to raise them later. Pricing is about finding the sweet spot between covering costs, maximizing revenue, and making your event accessible to your target audience.
Timing is an important consideration. What time of year is it? Are you approaching the end of the calendar or academic year? It can impact how people feel in terms of their overall mood and willingness to give. How many others may be competing for the same audience at the same time?
Also consider these things : 1. Donor Demographics: Consider the demographics of your donor base. If your supporters are generally price-sensitive, you may need to set more affordable ticket prices or offer different ticket tiers to accommodate various budget levels. 2. Value Perception: Communicate the value attendees will receive for their ticket price. If the event includes exclusive experiences, entertainment, or other perks, attendees may be more willing to pay higher prices. 3. Inclusivity and Accessibility: While the main goal is to raise funds, it's important to strike a balance by making the event accessible to a broad audience. Consider offering discounted tickets, early bird specials, or sponsorship options to ensure inclusivity.
Provide donors with a visual or tangible idea of what their donation will be used for. People love to know they are filling a need. For example: Instead of a plea to donate for those suffering with Alzheimer's Disease, our highly successful fundraiser was more specific. We asked for help funding our Adult Day Care program, where an exhausted caregiver could safely drop off their loved one and have a few hours to rest, repair, and refocus.