Setting the right price for your race/event
note: this post is appearing simultaneously in edited form on the website of my employer, RaceWire.com
I've interrupted my last series of posts on race site setup as I have been asked to start blogging for RaceWire on tops of event production; I will be publishing more general posts for them, as well as writing my posts with more local examples here. For this first post, I delve into a number of points I often find discussing with directors of new 5K's who are considering their budgetting and pricing for their event, as well as the concept of how to use price increases for better planning and management purposes.
- Start with the 'market price'
The most obvious choice is to look at races around you of a similar kind. What is a standard rate? Do the ones that charge more or less have more that they offer participants? Size up your 'competition' and place yourself accordingly.
The basic items that often dictate base pricing are : first, the distance of the race, second, the tangible goods (t-shirt, prizes, medals, food), and third, the intangible goods (quality of course, post-race entertainment, the quality of the cause being supported). The average race-day price for a 5K nationwide ranges from $25-35 depending on the market (generally more in cities, less in rural areas). 10K’s may add $5-10 to that, and shorter distances subtract $5-15. Half / Full Marathons tends to vary much more widely, but in rare / minimalist cases, do not tend to be below $50.
- Make it work with your budget
- Plan for numbers and make it make sense for you.
- Look at your projected expenses and how many participants you can reasonably get out.
- Add up your budget and raise your prices if necessary to match this based on your estimated participant number. If you are a new race, make every effort (pessimistic as it is) to assume that no one will show up, and try to match your costs with in-kind donations and sponsorships. If you are an established race, consider a range from 20% decrease to 20% increase range as *most* races will fall within this range.
- Plan for a 'rainy day', literally - bad weather can easily cut your attendance by 50%. Allow yourself options to scale back if the forecast is looking poor 5 and 10 days out. Have a marketing plan in reserve to encourage people and make light of the forecast if the weather is bad to try and retain your people who have already signed up or are are on the fence.
- Once you've got the basics of your pricing together… - Make it make sense for your participants
- What are you offering your participants for their cost? We have a saying in the hospitality/events business that has many variations expressed over time - 'everyone is competing with a frozen pizza and Netflix' is my favorite variation. Start with the baseline – for example a basic 5K with 2 water stops, bagels and bananas at the end, and medals for prizes… and go from there. Add in hot (or in the summer, cold) food, entertainment (on-course and off), gift certificates from local businesses, etc.
- How can you increase value and still make more money? How can you save money without decreasing value? It's easy to forget - a beer that costs a $1 in the store costs $5 at a bar, and similarly your t-shirts, items, pancake breakfasts etc can be priced accordingly if their quality will be good enough. Remember that as long as your event is a great experience, everything else will be worth more to a participant and a few dollars more won’t necessarily scare participcants off!
- speaking of scaring participants off - don't go too high! If you are uncertain, take the average price you have found and don't exceed it by $5 or $10 to avoid 'sticker shock'. It takes a serious amount of marketing on an unproven event to get people out. - Manage price increases effectively.
- Price increases over time can be used to take a lot of stress off of you as a race director. And of course, getting people registered early gets it on their mind and their calendar! Reasons to start low / end high include:
- Offering specials and discounts early on can serve the invaluable purpose of answering “is anyone even interested in this race??”, as well as providing a valuable metric over the years to gauge how far out $$ will be in your account for planning and purchasing purposes.
- On that note, it can also ensure operational revenue for your new race that you might not otherwise have; ask yourself 'why should someone register before they see the 5-day weather forecast??'
- You can also offer people reasons to register in addition to (or in place of) discounts : t-shirts, special recognition, guaranteed tickets to something, etc.
- In turn, scheduling your price increases for necessary cutoff dates (when you have to order t-shirts, give the caterer a # of participants, etc) can very easily help shape your orders and take the guesswork and worry out of purchasing those items. A popular choice in my area (Western New York) is only guaranteeing t-shirts (or performance tech shirts vs. cheaper cotton shirts) up until a certain date, which is both when the price goes up and shirts get ordered.
- Charge more for day-of vs. online registration. Taking in account the processing fees that any online site charges, encourage people to register early as this will take stress off you and your volunteers on race day. A $5 increase in race-day registration is completely understood by all regular racers.