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

[Nicholas Sarwark]

Don't forget that early sales can lead to breakage in the LP's favor,
where attendees purchase a package years in advance but are unable to
attend.  Obviously, some people would transfer that package to someone
else, but others would let that cost go as a donation to LP.

-Nick

On Wed, Feb 17, 2016 at 4:01 PM, Alicia Mattson <agmattson at gmail.com> wrote:
> 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.
>>
>> 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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>>
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>>
>>
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>
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