Setting keynote fees has always been a tricky issue for speakers, because what we offer – expertise communicated professionally – is a service. To add to the difficulty in setting fees, most speakers charge using a three-tier package where prices for each package usually carry from client to client. What raises or lowers fees for each ‘package’ was demand and availability. COVID 19, as it shut down live events, destroyed demand for live speakers and suddenly most speakers have nothing but availability on their calendars.
For years, we were able to accurately predict revenue based upon the budgets our prospects told us they would have, but even that model faces challenges. COVID-19 ensured businesses would struggle, which had a ripple effect on association budgets and even affected event budgets. Any speaker who has attempted to inquire about speaking budgets in a post-COVID-19 world has learned we’re in a new budget (and selling) environment. But there IS a way to ensure we are capturing as much of our fee as possible while still serving clients who are likely in a state of financial crisis themselves.
What this means is that how we used to charge and negotiate fees for our keynotes has changed, and if we want to continue to be successful we have to change with the times. Below are the things we’ve learned to do before, during and after our sales calls to ensure we’re maximizing our revenue and making the most of budgets in a COVID world.
(Interested in adapting your fees to COVID 19? Then you’re going to want to sign up for our next FREE Masterclass. Register HERE)
Before the sales call:
First, don’t lose your shirt
If we don’t know what it takes to keep the lights on or what it costs us to produce an event, then by definition we’re charging an arbitrary amount that isn’t based on business goals. The way we calculated this before COVID-19 was to look at the expenses incurred to travel to an event and buy any equipment, supplies or software needed. That would give us a top-line expense. Then we would take that fee and subtract the top-line expenses we incurred and we’d know what our net profit was. Divide that net profit by the hours we spent interviewing, building the keynote, researching, practicing and travelling and we can determine an hourly rate if we want to go that deep. What this allowed us to do as businesspeople was set a minimum ‘out the door’ fee to ensure we netted a minimum revenue amount for an event and kept our businesses viable.
However, because we’re largely presenting virtually these days, our hourly time on the road is nonexistent so we are only charging for our expertise and any expenses we incur to build and deliver our presentations. That doesn’t absolve us of the need to understand what our ‘out the door’ fee is, even if we’re delivering from home. We do need to calculate the cost of any equipment we’ll need and ensure that a single presentation will cover that expense, or if not, how many presentations at X rate we’ll need to conduct and spread the expense out across them to achieve a certain profit. Without knowing what we have to generate to keep the lights on in our business, we’re by definition running a ‘practice’ or worse, a ‘hobby.’
Second, know the prospect
We’ve always advocated pre-call research and it’s never been more applicable than it is with today’s tumultuous budgets. If I’m calling an organization that previously paid speakers who charge $15k+, I can be fairly certain they’ll maintain at least half of that budget for their virtual events, even in a COVID world. Additionally, it’s valuable to know what organizations are charging attendees to register whether the event is live or virtual, and how many folks they’re expecting. Just as our travel costs are nonexistent if an event goes virtual, so are prospect’s site costs. If an event is purely virtual, we can safely assume organizations are netting more profit per registrant, and depending on the number of registrants they’re expecting, we can get an idea of what their gross revenue for the event will be if they hit their registration goal. This can reveal if their event will generate $7,000 after on-site expenses or $70,000 if there are no site expenses.
That’s valuable to know as we consider what fee we want to charge especially if we’re providing a solution the folks in the audience desperately need.
Third, know your value proposition
In 2019, everyone was interested in increasing performance and profitability. Now, a lot of folks are more interested in survival and breaking even. That means if we’re going to maximize our fee, we have to position ourselves for what the market needs today, not last year. Selling an outdated value proposition is a guarantee for getting paid less than we deserve.
During the sales call/proposal:
First, understand the organization that you’d like to speak for
Not all organizations are taking a hit as a result of COVID-19 (Netflix and Amazon, for instance), but some are and we can determine which group our prospect is in by asking about membership or revenue decline during our sales calls. That will give us info we need in negotiations. Our talk is always an investment IF we can link its value to ROI for our clients. Folks are still willing to invest in a crisis if they think what they’re investing in will solve challenges they’re struggling with.
Second, still use the all-inclusive offer
The ‘all-inclusive offer’ is where we have everything and the kitchen sink thrown in as an option in our basic proposal. How we do that hasn’t changed in COVID-19. Here’s the language we use: “To ensure our talk drives action, we create an experience for your event that starts before, impacts during, and lasts long after. Because you said you were struggling with/trying to achieve XYZ, the things we really recommend in that package are ABC.” Additionally, just as we did pre-COVID, we don’t go over every item in the package. Rather, we highlight the ones that will most likely achieve the outcomes/things our decision maker said their event needs to achieve.
Third, be the one to bring up budget, but not price
After going over the highlights of the all-inclusive package, be the one to ask about budget first, stating that you understand it might not be what it was in the past. As with all negotiations, the first one to mention price is always the one at the greatest disadvantage in a negotiation. You do want to know budget, because if their budget doesn’t meet your ‘out the door’ fee, then you know to put that account back into the pipeline for outreach at some time in the future. If their minimum fee is enough for your keynote but not enough for books, online courses, etc., then let them know. We find that money often has a way of appearing if we start to remove value from the package in order to get down to the budget a prospect does have.
After the talk:
While many speakers believe that once the fee is decided upon and the talk is given that revenue opportunities are over, that’s not the case. Because we gather metrics from our audience during our talks and through an online course afterwards, we can come back to the meeting planner/decision maker and offer them customized follow-up content based upon what THEIR audience said they needed more of. At that point, we can bring in the idea of working with another bucket of money or even sponsors to fund your follow-on work.
COVID-19 has affected fees, but for those of us dedicated to maximizing both our fees and the value we provide, opportunities still exist – if we can adjust our systems to where our clients are today.
Love this content? You’ll never believe what we’re giving away in our free masterclasses each month! REGISTER HERE.