Dear Event Tech Companies,
I sit through a lot of event tech company demos and I’ve written before about some of the things that I believe need to be improved. However, for the most part, I really enjoy doing these demos because I can learn about new products on the market and also see the trends forming as new companies pop up to meet demands. A great demo usually goes a little something like this:
- I tell them about LKE and the work that we do for our clients
- The event tech company tells me about their product, specifically focusing on the aspects of their product that will most likely help our work
- I ask a few general questions to help me better understand various ways that the product could be used
- I then ask about monetization – what does the company charge?
And this is where the conversation often goes downhill in even the most awesome conversations. “Well, it depends” is really the worst phrase you could ever say to an event planner. It depends on what? In essence, it mostly depends on what they think you can afford. If you’re a big company or working with some huge clients, you’re going to get one price. If you’re a startup, you’ll get another price. And that’s the way the cookie crumbles.
It has to stop and here’s (a few loving reasons) why.
- There’s no worse thing in the middle of a sales process than to make someone feel as if they’re about to get taken advantage of. Planners know what you mean when you say “It depends”, especially if it’s not followed up with a concrete structure. “It depends” is okay if it depends on the number of registrants at the event, the # of transactions, # of events in a given year etc.” However, if you can’t specifically state what the price breaks are, you’ve failed.
- Larger companies don’t always have larger event budgets. And – most of our clients are smart enough to price shop. So if your price is flexible based on the client and your competitors are working on a fixed pricing plan, you’re most likely going to out-price yourself from the job.
- When you come up with a dollar amount to charge out of nowhere, you give all the negotiation power to the client. If I feel your price is too high, I simply talk you down. If $100 is equivalent to X, Y and Z in services and I can only afford $80, you can cut Z service our of the equation to fit my budget. However, if your price is pulled out of a hat based on how you feel about a customer, there is less room for negotiation. For example, I once had a company quote me $150,000 for a set of services. I told them it was simply too much and we weren’t interested in working with them. Because they were WAY overselling themselves, they eventually came down to $50,000 for all the same services! That means their upcharge was over $100,000 – just because they thought our client would pay it! They could drop the price by that much and still make money. It’s simply unacceptable.
So – as an event tech company – how can you better structure your pricing so that it is reflected well in the market? What metrics can you set as price breaks that will be easy to communicate to your target market and consistent regardless of who you talk to? Of course, you can always offer discounts or free services for clients that you really want to work with. But – have a baseline price that you work from. As a planner who wants you to be incredibly successful, please take my advice on this particular issue. I believe you will be much better for it in the future!!!
With love from your event tech-obsessed planner,