One of the questions I’m asked most (and that I’ve struggled most with in the past) is what my speaking fee is for any given event. This is a more complex question than you might initially think. Why? In the world of conferences and events, there’s a “holy trinity” of value factors that make an event economically valuable: audience, sponsors, speakers. This is something I learned from Jeff Pulver and Chris Brogan.
Audience: the right audience is highly valuable to sponsors. A crowd of people you can’t sell to isn’t all that helpful. Speakers bring in audience.
Sponsors: the right sponsors can afford to make an event happen. Without sponsors, you can’t make an event big and bold enough to stand out and attract speakers and audience. Audience brings in sponsors.
Speakers: the right speakers can lure audience and sponsors who want to be associated with or see recognizable people on stage. Speakers (and the knowledge they share) are arguably one of the most important factors for an audience to decide whether to attend or not.
Having good speakers can attract audience, and thus be able to attract high paying sponsors. It’s fairly difficult trying to attract the audience without the speakers (who provide the content) and it’s really difficult trying to attract the sponsors without the audience!
As you can see from the trinity, the role of the speaker is to lure people with knowledge or entertainment value. That’s the value that I and many others provide. The next logical question is, what’s the monetary number on that value? From a pure revenue perspective, let’s say that a conference looks like this:
- 300 attendees at $300 each to attend: $90,000
- 10 sponsors at $10,000 each to sponsor: $100,000
- 10 ad sales at $5,000 each to advertise: $50,000
Now let’s say there are 15 speakers at this event, each speaking once to the entire audience. Each speaker’s content is responsible for attracting the audience which in turn attracts the sponsors. Thus, each speaker is responsible for generating $6,000 ($90,000/15) of value to the event. That’s about the cap, the ceiling of what you can reasonably ask for as a speaker in this example, because the profit from sponsorships/ad sales is directly dependent on the event’s sales team and not you, and they are solely entitled to that profit for their work.
Obviously, there are many mitigating factors in this equation. For example, say there’s a keynote speaker, 10 time slots, and 5 tracks, and you’re speaking on one of the tracks. There are a total of 11 places that a paying audience member can be at any given time (keynote + 10 sessions), making an audience member worth $8,181 per timeslot ($90,000/11). You and the four other people that audience member could be seeing at that same time split the $8,181 five ways, making that track speaker worth $1,636 of generated value, while the keynote speaker is responsible for generating the full $8,181 for that slot.
Another mitigating factor is how much additional work you provide as a speaker. If you just show up, speak, and flee, you’re entitled only to a share of the value of the event above. If you promote the event heavily to your audience, pimping it left and right to anyone who will listen, stay for the entire event so attendees can chat with you before and after you speak, then it’s more than reasonable to add on fees for service above and beyond just the economic value of your knowledge being present at the event.
Why go through this much math? Why not just pick a number out of a hat or compare yourself to someone else of relatively equal knowledge and status and copy their fee? The reason I choose to go with this absurdly elaborate formula is that it’s straightforward to explain to a conference organizer when you suggest your fee to them. You know what your knowledge and ability is generating in terms of value, and you’re asking for a representative share of that value. It’s equally fair to the conference organizer; if you’re asking for above the ceiling for your fee, you need to justify the additional work you’ll do on behalf of the conference.
Even more important, doing this exercise for conferences also gives you an idea of how to evaluate your relative worth to any one attendee. In the example above, as one of 15 speakers to 300 people for $300, each audience member is effectively paying $20 to see you. If the knowledge you’re sharing can be sold directly to the audience in the form of a paid webinar, book, or other mass medium, you know the fair economic value of that knowledge, what the market has paid or will pay for it. You can then price those goods accordingly.
What about the expenses of the conference? In the above example, the gross revenue is $240,000. Let’s say that each attendee costs the event $150 to host, from food to A/V to venue cost, for a total of $45,000. Speaker costs would be $90,000 (the attendee share). That leaves a net profit for the event of $105,000, not too terribly bad. If a conference organizer wanted to charge more for attendees to cover more costs, it’d be fairly straightforward to explain to speakers that the event had allocated $150 per attendee for speaking costs, making each speaker’s share $10 per attendee.
For example, if you’ve done the math above and established that your value is approximately $20 per attendee and the conference is offering $10 per attendee to speakers, it’s then your decision as a speaker to accept or decline that rate. Remember that you always have the power to say “no, but thank you for thinking of me”.
I hope this long, convoluted, extremely math-y explanation of how to set your speaking fee is useful and helpful to you if you’re considering a speaking career. For conference organizers, while I’ve run plenty of events (even paid ones), I’ve not run a professional conference series in which speakers were paid, so I would love to hear from professional conference organizers how this math would fit into your planning!
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