It’s amazing, if you offer people the chance to name the price they are willing to pay for something, many actually ask for guidance. They are so used to someone telling them what something costs that they will often ask: “So how much should I bid then?”
Of course, what they want to know is what the minimum price is that the producer of the good or service will accept, something that is often related to the costs the producer has had to incur to develop the product. However, what to do if the producer has already covered his or her costs and will accept any price, as this will generate pure profit? This is what often happens in the conference industry, where the costs are mostly fixed, especially in the last few days before a conference. The organiser has already paid for his marketing campaign, the venue, the speakers and his own organisation, so adding some additional people to the conference room is not going to cost him a cent extra. If he can get these extra delegates to pay even a small amount of money, it will directly benefit his bottom line. Just remember that next time you get this pesky call centre operator hassling you at work trying to get you to sign up for a conference. (See also: “What is it with conference organisers?). At Conference Bay, we offer people the opportunity to make a bid for a seat at a conference, and therefore we often get the question how much one should bid.
So if you get a bit unsure about making a bid, does it make sense then to book your seat very early? Most people know that in the airline industry booking early can get you better rates. In the conference industry these discounts are called Early Birds. Nowadays we even see Super Early Birds and Extended Early Birds. (We are still waiting for the Unhatched Egg discount…). All these discounts are meant to bring in a nice amount of cash for the organiser so that he can guarantee the event to the venue, his sponsors and speakers. Once the sponsors have committed as well, the organiser in many cases reaches his break-even point. This means that from this moment on every dollar is pure profit and hence we think that bidding should be interesting for the organiser as it reveals the “willingness to pay” of the customers. Better to capture this money than keep charging high prices and end up with empty seats once the event takes place.
Buying a seat during the Early Bird period makes sense if you’re sure that you will be attending the conference. If you are not sure, or you decide at a later stage that you want to attend, remember that bidding for a seat is an easy way to show that you are willing to be a serious and valuable participant to the conference – it is better for the organiser to have someone who at least paid something than give the tickets away for free to people who may not turn up and who are unlikely to increase the value of the networking sessions for paying customers.
For an interesting case study on how bidding was used iin the music industry, read this story:
The Radiohead case
