Pricing Strategy for Event Management

Organizers of events can use cost-plus pricing technique to determine their product prices, ensuring a certain amount of return by covering the whole cost. Additionally, budget preparation helps users forecast event costs and monitor expenses, enabling effective control over costs and achieving targets.

Financial decision making for
creative events and projects
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Table of Contents
INTRODUCTION ...............................................................................................................................3
DESCRIPTION OF THE EVENT.......................................................................................................3
COMMERCIAL VIABILITY OF THE EVENT.................................................................................3
DETAILES OF THE VENUE AND FACILITIES OFFERED............................................................4
EVENT BUDGET................................................................................................................................4
SOURCE OF FINANCE......................................................................................................................5
DESCRIPTION OF ALL THE RELEVANT INCOME STREAMS...................................................5
DIFFERENT PRICING STRATEGIES ..............................................................................................6
CONCLUSION....................................................................................................................................6
References............................................................................................................................................7
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INTRODUCTION
Event management is regarded as the process of making plan and managing an event,
activity or project. There are different types of events like press conferences, trade shows,
promotional events, charity functions, board meetings, consumer appreciation parties, seminars,
product launches, award ceremonies etc (Allen and et.al., 2012). Financial decision-making is the
process of collecting required quantity of funds and generate revenues to maintain proper
availability of funds to organize an event. Wonderland event is an event marketing agency of
London which organize, launch, elevate brands across the world. In the present times, all of the
organization launch new and innovative products and services to grab larger market share and
increase competitive strength (Supovitz, 2013). Thus, the present assignment will address the
financial decision-making for organizing an event for new product launch.
DESCRIPTION OF THE EVENT
Looking at the competitive market era, it is essential for the organizations to product
innovative products and services to meet customer demand. It also enable firms to compete
effectively with the rivalry organizations. Product launch and brand activations refers to providing
platform and ideas which helps corporations to showcase their new products. It assist firms to boost
their sales and thereby maximize profitability (Stadler, Fullagar and Reid, 2014). By launching
product effectively in the market, companies can determine its survival. Thus, the present report
focuses on launching a party to bring excitement in the consumers about new product and services.
It plays a crucial role in the market introduction of the new product by covering greater media
coverage. Perfectly presenting the new product will assist organization to build a stronger position
in the market and enhance competitive ability to a major extent. A well executive product launch
attract attention of high level of consumers and create a strong impression in their mind (Allen and
et.al., 2012).
COMMERCIAL VIABILITY OF THE EVENT
Product launch event is of great significance which assure future survival of the business
organization. It is an essential component of the organization's marketing mix. It provides
information to the public about upcoming products, services, prices, availability etc. It's viability
can be seen in terms of attracting consumer attention, maximizing revenue, business yield, company
brand reputation and develop new relationships (Eisen and et.al., 2012). Larger the customer base
across globe provide assistance to the firms to increase their potential turnover and profitability. As
a result, business enterprise will be able to compete effectively with the rivalry organization and
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strengthen the market position as well.
DETAILES OF THE VENUE AND FACILITIES OFFERED
The product launch event will be held on 25th July, 2016 and it will include different types of
products which have been developed by the company. While, launching an event, venues comes at
high priority. It is because event organizers must organize event at such places, where target
audiences can easily come and attend the product launch event. This product launch event will be
organized by Wonderland event in the Hilton Hotel where large number of people can easily come
to attend it (Backman, 2013).
Numerous services will be provided by Wonderland hotel to the organizations for launching
a new product. It includes optimum use of venue space to conduct event, virtual room styling with
proper lighting, decoration, digital wallpaper, multimedia and 3d projection mapping, themed and
styled environment to align with business brand, live webcasting, social media integration etc.
Further, availability of high-tech equipments (Berridge, 2014). Contemporary space, adequate
sitting arrangements etc. facilities are provided to the firms to showcase its new products.
EVENT BUDGET
Budget provides an estimation about potential expenditures which Wonderland Event will
incur on organizing an event for new product launch (Masterman, 2014). There are many facilities
provided by the event company which impose cost to it such as rent, food and beverage facilities,
banners, posters, advertisement, decoration etc (Andersson, Getz and Mykletun, 2014). With
regards to new product development, its budget is prepared here as under:
Item Amount
Rent of hotel 5000
Parking facilities 600
Staff 1800
other venue fees 900
Food and beverages 1200
Drinks 400
Linens 300
Arrangement of chairs and tables 500
Floral decoration 250
Presentations 700
Menus 300
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Registration table 600
Photographers 1500
Posters, banners etc. 900
Flyers and other prints 1100
Facebook advertisement 600
Radio announcements 650
Online advertisement 700
Total cost 18000
SOURCE OF FINANCE
There are different source of finance available to the Wonderland Event to organize a new
product. It comprises bank loan, personal savings, financial assistance, government grants etc,
described hereunder:
Bank loan: Loan is the first and foremost source available to Wonderland Event to organize
an event. It can raise availability of funds through external borrowings, specially from financial
institutions (Hall, 2012). Bank provides funds at an implied interest rate as the cost of finance
which event organizers has to pay timely. Event company can take short-term, medium-term as well
as long-term loans as per their requirement.
Personal savings: Organizers can invest the available money from their personal savings to
organize event. The most important benefits of this is it helps to minimize the need of external
borrowing through bank. Moreover, it is available without any cost to the organizers (Mackellar,
2014).
Financial assistance: Funds also can be collected through receiving financial assistance
from friends, relatives and other member (Patterson and Getz, 2013). Its advantage is the money
will be available at less cost as compare to borrowing from bank.
Government grants UK government also provide grants to organize events but still,
generating grant is not an easy task for the event organizers (Andersson and et.al., 2013). It is
because government only provides grants for those events which are of regional importance like
increase outbound tourist etc.
DESCRIPTION OF ALL THE RELEVANT INCOME STREAMS
New product launch event can generate revenues from the following sources, describe
below:
Participation fees: All the person who will attend the event of new product launch, will have
to pay a small participation fees (Sorokina, 2015). Thus, it is a common source of revenue for the
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Wonderland Event. Larger the number of participates and the participation fees increase the event
organizers income or vice-versa.
Sponsorship: Sponsorship is also an effective way available to generate funds to organize
event. Sponsoring companies provide funds to launch a new product and services in order to attract
public attention (Masterman, 2014). Wonderland Event, as an event director, need to take some
precautions in relying largely on sponsorship.
Merchandise sales: It refers to the sale of wide range of product and services like product
launching organization can sale its new products to the consumers and generate revenues through
this. Further, sales of drink bottles, badges, pens etc (Wang and Cole, 2016). helps to enlarge event
organizers' revenues to a greater extent.
DIFFERENT PRICING STRATEGIES
Wonderland Event can use different pricing strategies to decide their evet prices. Some of
the pricing strategies are illustrated here as under:
Cost plus pricing: This is very often use technique which can be used by Wonderland Event
to charge their event prices. In this, organizer has to determine total cost incurred on the event and
add an appropriate profit margin percentage to decide the selling prices. It's advantage is it helps to
Competitive pricing: This pricing strategy do not consider event cost or customers while
deciding selling prices. This pricing method take into account the competitors prices and prices are
decided accordingly (8 Pricing strategies to use on your product and services, 2013). In such
respect, Wonderland Event can charge a little bit higher prices than their competitors to generate
revenues. It is an effective technique to compete effectively with the rival organizations.
Value based pricing: It is a customer - centred pricing approach in which Wonderland Event
has to assess organizations ability to pay prices for organizing events. Thus, the determination factor
of price decision is the consumers willingness to pay rather than the cost of products or services
given to them (The Price Is Right, turning a profit in the event planning business, 2014).
Rate based pricing: This pricing method is also called hourly pricing in which prices are
decided according to the time period. This pricing strategy guaranteed to generate revenue for every
working hour for which services has been rendered to the companies (8 Pricing strategies to use on
your product and services, 2013).
CONCLUSION
By concluding the entire report, it can be concluded to the Wonderland Event to take funds
through personal savings and bank borrowings. Moreover, from the report, it has been inferred that
sponsorship, participators fees and merchandise sales are the ways available to Wonderland Event
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to generate revenues from the event planned to introduce new product in the market. Further, event
organizer can be suggested to use cost plus pricing technique to decide their product prices as it
assure some amount of return by covering whole the cost. Along with this, budget preparation assist
users to forecast their event cost and monitoring of this enable organizers to make an effective
control over the cost and achieve targets.
REFERENCES
Books and Journals
Allen, J. and et.al., 2012. Festival and Special Event Management, Google eBook. John Wiley &
Sons.
Andersson, T. D. and et.al., 2013. Factors influencing grant and sponsorship revenue for
festivals. Event Management. 17(3). pp.195-212.
Andersson, T. D., Getz, D. and Mykletun, R. J., 2014. Festival and event management in Nordic
countries. Routledge.
Backman, K. F., 2013. Event Tourism: Concepts, International Case Studies, and Research. Event
Management. 17(1). pp.95-95.
Berridge, G., 2014. The Gran Fondo and sportive experience: an exploratory look at cyclists'
experiences and professional event staging. Event Managemen. 18(1). pp.75-88.
Eisen, T. and et.al., 2012. Targeted therapies for renal cell carcinoma: review of adverse event
management strategies. Journal of the National Cancer Institute. 104(2). pp.93-113.
Hall, C. M., 2012. Sustainable mega-events: Beyond the myth of balanced approaches to mega-
event sustainability. Event Management. 16(2). pp.119-131.
Mackellar, J., 2014. Surfing the Fringe: An Examination of Event Tourism Strategies of the Bleach
Festival—Coolangatta Queensland. Event Management. 18(4). pp.447-455.
Masterman, G., 2014. Strategic sports event management. Routledge.
Patterson, I. and Getz, D., 2013. At the nexus of leisure and event studies.Event Management. 17(3).
pp.227-240.
Peachey, J. W. and et.al., 2014. Exploring participant motivations to take part in an elite,
multinational, sport-for-development event. Event Management, 18(2), pp.153-168.
Sorokina, N., 2015. Sustainable event management: A practical guide.Tourism Management. 47(6).
pp.77-78.
Stadler, R., Fullagar, S. and Reid, S., 2014. The professionalization of festival organizations: a
relational approach to knowledge management.Event Management. 18(1). pp.39-52.
Supovitz, F., 2013. The sports event management and marketing playbook. Wiley Global Education.
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Wang, W. and Cole, S. T., 2016. A Comparative Analysis of Event Attendees' Spending Behaviors,
Satisfaction, and Information Search Patterns By Event Types at a Midwestern College
Town. Event Management. 20(1). pp.3-10.
Online
8 Pricing strategies to use on your product and services. 2013. [Online]. Available through:
<https://fizzle.co/sparkline/7-pricing-strategies>. [Accessed on 18th July, 2016].
The Price Is Right, turning a profit in the event planning business. 2014. [Online]. Available
through: <https://www.entrepreneur.com/article/233684>. [Accessed on 18th July, 2016].
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