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TOPIC: Economics

Economics 16 years 3 weeks ago #1

It seems to me that there are some really limiting factors to how TA operates. I truely believe the staff when they say that it's really not for profit, and actually done just for the fun of it. But that doesn't mean that it's not expensive to run the event - obviously it is very expensive. In fact, I don't know the financials or anything, but I'm betting that it all runs on subsidy from someone - that is, it's not technically profitable at all. This means that the existence of the event is completely at the will of those who volunteer for it, and subsidize the event in other ways.

The problem being that it's hard to get more committment on this level. There are better ways of expanding such an operation.

What I'm wondering is if we can brainstorm up some way to make the event more profitable. Basically, what could TA provide that you'd be willing to pony up more cash for?

For instance, I'm assuming that the amount charged is lower than they could charge, given how early it books up. Would you pay more to play? I think that I would to some extent, depending on where the event goes. But can this make up for any deficits? I'm thinking that's not likely the case. Basically, the number of people that can be forced through the events in the time available probably doesn't come within an order of magnitude of being enough to pay for costs. IOW, I'd guess that they'd have to charge $200 to make it profitable - at which point it exceeds the will to pay for almost everyone, making it a non-viable solution.

Still, it's one option that they must be considering. Again, how much would you pay?

Other solutions would be to force even more people through in the same amount of time. But, again at ten to one, that means one minute rooms or so. And more staff, etc. Not really viable again.

Lastly, there's adding more space, and running more events (I'd love to see a second dungeon), but obviously this only compounds the problem. If the number of folks going through one set of ballrooms is unprofitable, then more would be worse.

This seems to be an insurmountable problem. So, first, is it insurmountable, or does somebody have a brilliant idea of how to increase the number of paying customers without increasing outlay even more? Second, if it is insurmountable, what other activities or products can TA put on to make additional income? Again, what else would you pay for?

My hope is that we can come up with something to help make the event more solvent. This would mean, I'm sure, reinvestment into the event, more staff, more of everything that makes TA events great.

So, whaddaya got? Any great thoughts?

Mike

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Economics 16 years 3 weeks ago #2

okay, so, between the two TA events, i got them grossing about $45-50 thousand (that assumes about an 85% turnout for TH.)

so, you're saying that they'd have to make half a million dollars to break even for both shows? each con?

cuz, remember, we're talking about two cons. granted, they won't sell out every slot at SoCal, but they'll probably bring in about 60% of the business, if not more. So, for SoCal, let's put the number at $25K.

so, $750 thousand to break even... i think that might be a little steep. of course, all of these numbers are speculative, so here are some of mine.

between the two cons, TA brings in about $70K. i have no IDEA what this cost to produce, but i have a hard time thinking that they are TOO far off of the black. granted, i don't mean $100... i'm thinking more like 20 to 30 grand. (i wish i knew if i was close or not... meh.)

okay, so, how do you pull in another $50K (assuming i'm low)? well, let's see... you got about, what, 2000 people who ran through TD or TH, right? maybe 2500? so, that means that you would have to increase the amount that each one of them was spending by $25 to break even (remember, none of these number takes into account the cost of tokens... i'm assuming that money will be made back once the economy of TD gets rolling, and those tokens sell out... which they will.) would you pay $45 to run through the dungeon? no, probably not.

so, what about raising the price of the token bags, but putting a better distribution in there? how about a bag for $12, but you get more rares? or, selling more swag (T-Shirts / Tote Bags / Hats / Other Bullshit)? hook up with Starwind Designs and offer to sell embroidered Token Bags that say True Dungeon on them?

bands don't make their money off of ticket sales... they make it off of merchandise. sell more merchandise, and you will make more profit. i want to support TA, i want to buy merch. but, i can tell you, it wasn't being pushed on site. no one told me what was available for sale, if anything. it was sitting out on the table (i think?), but selling is active. and, there was no active selling going on.

sell more stuff, make more money. that's just the way the world works.

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Economics 16 years 3 weeks ago #3

that assumes about an 85% turnout for TH.)


I can't tell you anything monetarily (primarily since I don't know anything about that), but I'd have to guess that about 75-80% would be a fair estimate for TH.

Tim
True Heroes Watcher/PH
1st Dungeon Master
Yarrrrr! - Pirate Ninja

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Economics 16 years 2 weeks ago #4

Leaving the number aside, True Adventure events do exist because of the support of other entities. Obviously first and formost among those supporters are you guys the players - Thanks! Without a strong base of player support their would be no reason for other companies to want to be involved. It is no secret that Peter and Gencon are huge supporters and fans of the event. If you want to see TA continue to grow drop them a line and tell them how much you loved it :D This year WOTC also supported us and gave us the opportunity to be a part of the 30th anniversary celebration and to use official D&D material. Again, feel free to email WOTC and tell them how much you liked the event and how great it was to have them a part of it. Last but certainly not least, the volunteers are the real backbone of the event. These folks are using their vacation time to come work their butts off because they care about the event. We say this all the time, but share your love with the volunteers because without them we couldn't make this happen.

Lee
bur BUR bur BUR<br /><br />PS I can't spell, don't be suprised when you read my posts...<br /><br />Head D.I.N.O.

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Economics 16 years 2 weeks ago #5

Don't forget Upper Deck was a major sponsor of True Heros. They brought in all of the fun and funky toys upstairs.
Jenn<br /><br />Recovered Wench

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Economics 16 years 2 weeks ago #6

okay, I PMed Peter on the GenCon forum.

I wrote an email to Upper Deck.

I wrote an email to WotC

It took me all of... 6 minutes.

I think we all should take the time to do the same.

Don't know what to say? I said this to UD and WotC:
(feel free to cut and paste, if you like)

To whom it may concern,

I just wanted to write an email to whom it may concern at Upper Deck to let you know that I appreciate all of the support that you gave to True Heroes this year at the GenCon Game Faire. It was a wonderful time, and I know that it couldn't have been done without the support of Upper Deck.

So, thanks. I hope that True Heroes and Upper Deck continue to be affiliated as True Adventures becomes a fixture at GenCon.

Thank you again,

Josh Berling

Of course, I changed it when I sent it to WotC, but this could do wonders if we all send off emails.

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Economics 16 years 2 weeks ago #7

Mails forthcoming from me, too, FWIW. And, this is, no doubt, a great way to support these events.

And, yes, there's no doubt that debts are owed to these supporters, and the volunteers. I don't want to discount that in any way. In fact, I'm assuming that for the near future, that this will all need to continue for these events to be at future GenCons, etc. But this is all somewhat ancillary to the question that I'm trying to raise.

Further, I'm not really interested in the precise numbers themselves (it's not our business, really). This is not an attempt to pry. And I'm probably terribly off on my estimates anyhow. Who knows? But even with the other estimate here, we can see the problem. A more conservative price estimate of $45 per person is still unsustainable it seems.

In fact, raising the price of anything would have to be in small increments. What you definitely don't want to do is to reduce the interest due to pricing to where the event does less than to sell out. For several reasons. Again, simple economics, when you raise the price, demand drops, meaning that there's some optimum price point where you still sell everything, but get the most you can for it. Actually, the optimum point in the curve might be at less than full capacity, but you don't want to make it an elitist event or one where you have the problem of not knowing how much staff you need.

So, again, it's not a question of what they need to charge to break even, it's a question of what you'd pay, so they have an idea of whether or not they can raise the price. Now, I know we can't get a scientific survey here - in fact, anyone who takes the effort to post here, will probably be more likely to pay more than the average attendee who doesn't post given that they care more, apparently. Still, it doesn't hurt to get an unscientific answer for the people running the show. How much would you pay?

I'd definitely do $25, for instance, and probably $30, and I consider myself cheap (SITCOM - single income, two children, opressive mortgage, AKA House Poor). Especially considering that I'll be expecting improvements in the experience each time as the staff learns lessons, I'll be more and more willing to pay more for the experience. Do others feel like I do? Would you pay more?

As for merchandising, there's some tricky stuff there. As I understand it some of the merchandising already goes to some of the supporters in order to directly defray their costs (I'm going to guess that anything with a GenCon on it goes to GenCon, likewise with Upper Deck). So I'm not sure if they are able to sell more merchandise per se at all. And, again, there's probably only so much that the audience is willing to absorb. For instance, some people will buy a new T-Shirt each year, but some only once. The last thing the event needs is to be saddled with a pile of such inventory that they've paid to produce, but can't move.

Again, the problem becomes the small size of the market. Without more customers exposed, growth becomes impossible.

So, any way to get people to buy more stuff without having them go through the dungeon (or TH)? This seems to be the essential problem in gaining further revenues.

The only other thing that can be done is to expand the product. Meaning, instead of merchandizing more, is there something else that they can sell? For instance, I've proposed entrance into a LARPish area - which has an attendant problem of costing more for the space - but you can see that there are other products that the event could provide, in theory.


Or, is my assumption that they can't just carry on as they are faulty? I mean, does there need to be any expansion? Or will the work from one session carry over to the next, automatically improving things over time? I may be worried about nothing.

Mike

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Economics 16 years 2 weeks ago #8

i think, for true profitability, you need outside investment to make this a static environment - this needs to exist in a place, that customers come to, and not as a travelling show.

how close is that to reality? not close. but, i think that should be the long term goal (a goal, by the way, that would define my vacations for the rest of my life... and maybe even some weekends that aren't vacations.)

as for the merch thing... you don't have to worry about overhead and unmovable product with a company like cafe press (or whomever else they would choose to use). they only produce as many products as are purchased, no more than that. so, you have no overstock.

i would pay $25, and I might pay $30. but, to make that jump, i would have to feel pretty confident about the quality of not only the module, but of the DMing as well. i would not be happy paying $30, and getting screwed by an overzealous DM.

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Economics 16 years 2 weeks ago #9

Good points. It's the hotel ballroom rental prices that are the problem.

Hmmm. Lesse. Given the amount that it costs to rent, I wonder how much more it would cost to buy something near the convention center...

The problem with cafepress is that you make very little per unit sold unless you charge unreasonable prices. Basically, CafePress charges the price of a printed t-shirt for a printed t-shirt, making the only potential profit overpricing that you do. If TA went to that model now, they'd make less than ending up with some overstock.

Mike

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Economics 16 years 2 weeks ago #10

okay, I PMed Peter on the GenCon forum.

I wrote an email to Upper Deck.

I wrote an email to WotC

It took me all of... 6 minutes.

I think we all should take the time to do the same.


Cool on ya, jberling!

I should really do the same - I've been meaning to for some time, but I'm an utterly lazy *** when it comes to hunting up the email addies to send stuff to, and I can't be bothered to jojn another forum just to PM someone. Is there any chance that someone would be willing to post the relevant email addresses to this forum?

(BTW, jberling - I keep reading your name as "jibberling" and imagining these pesky little jabbering monsters running around in the dungeons of TD, like kobolds, but wielding little laptops and trailing ethernet cables. :) )
"THERE WILL NEVER BE A TOKEN EQUAL TO A GOOD BRAIN!"- Smakdown

Check out these awesome resources:
Cranston's Character Generator for iDevices or Android
Amorgen's Excel Character Generator
And the ever-useful Token DataBase , expertly maintained by Druegar.

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Economics 16 years 2 weeks ago #11

(BTW, jberling - I keep reading your name as "jibberling" and imagining these pesky little jabbering monsters running around in the dungeons of TD, like kobolds, but wielding little laptops and trailing ethernet cables. :) )


Those are called Marketinglings. Their general habitat is that of a medium or larger sized company. Not worth much experience alone, but in packs they're deadly and tough to beat, even for the most seasoned Office Adventurer. They attack with Inane Logic a number of times per round as many as are present (3 Marketinglings = 9 attacks per round). Their AC is low, but they secrete an ooze that makes them slippery and hard to hit or catch. Generally chaotic neutral, you'll occasionally run into a pack of them led by a chaotic evil Marketingling. If left to grow, that leader will usually end up as a Director of Human Resources.

Sorry, that started as a silly comment and kinda took on a life of it's own.
Volunteer DM, GenCon Indy 2004
Marketinglings are dangerous...

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Economics 16 years 2 weeks ago #12

(BTW, jberling - I keep reading your name as "jibberling" and imagining these pesky little jabbering monsters running around in the dungeons of TD, like kobolds, but wielding little laptops and trailing ethernet cables. :) )


Those are called Marketinglings. Their general habitat is that of a medium or larger sized company. Not worth much experience alone, but in packs they're deadly and tough to beat, even for the most seasoned Office Adventurer. They attack with Inane Logic a number of times per round as many as are present (3 Marketinglings = 9 attacks per round). Their AC is low, but they secrete and ooze that makes them slippery and hard to hit or catch. Generally chaotic neutral, you'll occasionally run into a pack of them led by a chaotic evil Marketingling. If left to grow, that leader will usually end up as a Director of Human Resources.

Sorry, that started as a silly comment and kinda took on a life of it's own.


Instant classic. I'd put it as your signature file if I were you :)
Lance Lamont

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