[Lnc-business] early convention revenue strong cause prices set early

[Alicia Mattson]

If the LNC wants to take a look at this while we're in Phoenix, I'll be
happy to break out the super-cool spreadsheets that I've assembled in the
convention archive.  I guess that means I need to spend a little time
filling in info-to-date for 2016 for comparison against past years...

I'm not opposed to giving it a try, selling 2018 convention packages at the
2016 convention.  I think the pattern of package pricing over the years has
been consistent enough that we can make a pretty good guess at what it will
need to be in 2018 also.  I've got data for that.

I'm not convinced that it will necessarily increase attendance or
profitability of the event, but we don't really have data to say either
way.  I'd be willing to try it and see if it helps.  If it doesn't, then no
need to repeat the effort in future years.

I might be able to make a case from the archive data that starting to sell
in December vs. January vs. February may not substantially change the final
sales figures, but merely re-distributes the timing of those sales because
the people who are going to come are going to come regardless of when the
package sales start.  I think by about 7-8 weeks prior to the convention,
the sales across various years tend to catch up to a consistent level
regardless of how early/late the sales started.  This impression is not
from thorough analysis, just from having looked at a decent starting pile
of data, and maybe additional thought/input would push me to a different
conclusion.

If it is the case that early sales don't actually increase the total sales,
then the question becomes whether it's beneficial to have cash in hand
early.  I would say yes to a limited degree, but there's a point of
diminishing return on having more cash on hand earlier because the biggest
chunk of cash-out happens at the end of the convention after 100% of the
revenues have been collected.

We do need to make some convention expenditures in advance, things like
purchasing delegate badges, ribbons, binders, etc.  We may purchase flights
for non-delegate guest speakers and for staff.  Those are relatively small
percentages of total expenditures.

Without breaking out contracts to look at the precise details, let's guess
that within a month prior we sometimes have to make an advance deposit for
some percent of the expected food/beverage bill.  With F&B running often in
the $60k-70k range, if we had to put half down as a deposit, that could be
$35,000...not chump change.

With total convention expenses likely to be $150k-170k, unless I'm
forgetting something else large, we can ballpark that we need 30% of total
revenues in advance for those milestones.  Archive data argues that by 7-8
weeks prior, we've sold about 60% of our packages, so as long the number of
attendees is on pace with expectations, that's usually sufficient to cover
these kinds of advance costs.

Once we cover those with package sales, the largest expenditure comes after
the convention when we get THE BIG BILL from the hotel.  It includes the
balance of food/beverage, the a/v which is a large chunk, staff hotel
rooms, suites that we re-sold, etc.  We get a large bill from the printer.
Credit card purchases have to be paid in a month or so, and expense
reimbursement requests trickle in.

My initial impression is that our typical sales patterns are usually
sufficient to cover the advance costs, and the only value to selling
tickets 2 years early is if it will end up increasing total sales.

One potential risk that comes to mind is that we could find that in the end
we've sold about the same number of packages, but more people bought early
at discounted rates rather than last-minute purchases at higher rates.  The
result could be just lower revenues from the same quantity of package sales.

I'm willing to try it, and after the 2018 convention we'll evaluate whether
it worked or not.

-Alicia




On Wed, Feb 17, 2016 at 7:16 AM, Scott L. <scott73 at earthlink.net> wrote:

>
> I am not sure why the ED is singling me out on this issue.  I am pretty
> sure there are other LNC members who think selling packages at a Convention
> for the *next* Convention is a good idea.
>
> The best people to comment on this suggestion are the members of the
> current Convention Committee.  Does the time-value of money work out such
> that it is helpful to get that first $20,000 or whatever it is into the
> bank account now, as opposed to waiting until January 2018?
>
>    Scott Lieberman
>
>
> GGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGG
>
> -----Original Message-----
> From: Wes Benedict
> Sent: Feb 17, 2016 6:55 AM
> To: lnc-business at hq.lp.org
> Subject: Re: [Lnc-business] early convention revenue strong cause prices
> set early
>
> Dr. Lieberman,
>
> I think you've always been a proponent of selling packages for the next
> convention at the current convention. Do you still feel that way? If so,
> and the LNC wants to, I'm for it.  I've been reluctant to do it before, but
> I think now I'm for it. You just need to set the prices. I think the LNC
> can approve the 2016 Pre-Early Bird prices as the prices for the 2018
> convention. They are close enough. We don't need detailed calculations and
> projections to get more precise prices. If, later, we decide we need to
> raise prices, well we can honor the prices for the people who already
> bought them. If we decide to lower prices, we can issue refunds later.
>
> What do you think? If y'all pass it at this LNC meeting, we'll have forms
> ready for 2018 Convention shortly after, and certainly we'll bring them to
> the 2016 convention and push them often.  All I need from the LNC is an
> approved price list. For convenience, here's 2016.
>
> 2016 Convention Pre-Early Bird Prices (were valid till 12/31/2015 plus a
> few days until I updated the website):
> 2016 Attendee Ticket is 95
> 2016 Basic Ticket is 139
> 2016 Bronze Package is 259
> 2016 Silver Package is 349
> 2016 Gold Package is 399
>
>
>
> Wes Benedict, Executive Director
> Libertarian National Committee, Inc. <http://lp.org/membership>
>
> GGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGGG
>
> On 2/17/2016 8:57 AM, Wes Benedict wrote:
>
> Below is from a January 20 email I sent to BetteRose and a few others:
> =================
> Additional important data point.
>
> Do you know what our convention revenue for the 2014 convention was as of
> January 20, 2014? I'll tell you in a second.
>
> Our revenue for the 2016 convention as of today is* $62,501*. That's
> without having even mentioned anything about any specific speaker.
>
> Our revenue for the 2014 convention as of January 20, 2014 was $0 (zero
> dollars).
> Same for the January's corresponding to 2012, 2010, 2008, and 2006.
> January 2004 revenue for the 2004 convention was $1,100.
>
> Why $62,501 for 2016 when it was practically zero for the prior decade?
>
> #1 reason is because YOU set the prices early. #2 reason is because LPHQ
> put up a payment system soon after you set the prices, and then later
> mentioned it in emails. In the past, the convention committee could never
> get their prices decided and they also usually tried to make a website on
> their own which set things back even further.
>
> So I guess I'm making two important points. #1) People are coming to the
> convention regardless of who the speakers will be; #2) We are way ahead on
> revenue but must be cautious--we are ahead on revenue because we set prices
> and took payment--we can't tell if final demand for the convention will be
> high.
>
> BetteRose and Daniel, I very much appreciate your work on this convention.
> I think you are doing a great job when I compare your work to previous
> conventions. It has been a pleasure working with you both. You seem to
> allow staff to make suggestions and actually listen, regardless of whether
> we agree on everything.
>
> It's going to be a great convention. Let's keep it up. Don't let my
> concerns about speaker fees concern you too much. Thanks again.
>
> Wes Benedict, Executive Director
> Libertarian National Committee, Inc.
>
>
>
>
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