Do conference organizers make a good profit?

Question

I was shocked to learn that the participation fee for a large annual European conference almost didn't change when the host country changed from one of the most expensive Western European countries to one of the most inexpensive Eastern European countries. I couldn't see any explanation other than the organizers making a huge profit, given that the number of participants was a few hundred and the participation fee was about 500 Euro per participant.

So, my question is: How common is it for conference organizers in academia (that is, the responsible institution and/or members of the local organizing committee) to derive a monetary profit by deliberately charging a too high participation fee and pocketing the difference between the collected participation fee and actual expenses and/or by getting a kickback from the venue or a hotel?

I'm asking about making an unduly good profit that is clearly not commensurate with the time and effort spent by the organizers - say, a profit at least a few times larger than what the time spent by the organizers is worth according to their paying rate at their institution.

To put it simply, do conference organizers in academia make good money?

Answer 1

While there are certainly some people who organize conferences for profit, every reputable conference that I have ever dealt with (as either organizer or participant) has been run with the intent of keeping fees as low as possible while breaking even.

Large conferences have many costs beyond the venue:

• Large conferences often have paid staff, whose salaries are a major expense.
• If you are working with a society, there may be fees for publications, as well as fees to support society staff.
• Hotels can be a gamble: they give you discounts, but it's often required to be linked to a block of pre-reserved rooms by a contract, and if attendees don't use all the rooms in the block, the conference will end up responsible for the cost of the rooms.
• Finally, given the unpredictability of attendance, a yearly conference often banks money in more profitable years to avoid bankruptcy in years where it takes a loss (this is one of the services that societies provide as well).

Corruption such as you describe (organizers taking kickbacks or lining their own pockets) is certainly possible of course, and I am sure it happens in some cases. I would expect, however, that it is relatively rare, particularly given that conference finances are usually run through a larger organization (whether society or university) with accounting processes designed to prevent corruption rather than via the personal finances of a poorly supervised group of organizers.

Answer 2

I organized several big conferences and my answer is no.

You would be shocked to hear the prices for a conference venue, even if the conference takes place in a university. (OK, then the university gets the money, but not the organizing group.) Venues outside a university are even more expensive.

A second important point is the catering. Assume, for example, the catering costs only 20 Euros per participant per day (which is realistic for a Western European country - not for real meals, only sandwiches, coffee, soft drinks) and there are 500 participants. Then you have 10.000 Euros per day, 30.000 euros for a three-day conference, only for a little bit of catering that people hardly notice.

Then you need a lot of helpers. The usual university staff are not enough to handle this. You need additional help, external staff you have to be paid per hour and conference days are long, let alone the days and weeks before.

In Western Europe, the invited speakers often get their travel costs reimbursed, i.e. the conference organizers must pay their flights and hotel bills. Of course you don't want to spend a fortune on this, but if you want them to come back one day, you won't choose the cheapest hotel either ...

And last but not least, there are more costs you would not think of in the first place, e.g. for promoting the conference or the information material for the participants.

No, conference organizers do not make a fortune with a conference. Perhaps they have moved to Eastern Europe because they could not afford Western Europe any more, due to the current rise in prices.

Answer 3

A lot of conferences are put out by nonprofit organizations that release financial statements, so you can check yourself by looking at the numbers.

The Society for Neuroscience is the principal neuroscience professional organization. They have an annual meeting with about 30,000 attendees.

Here's their 2022 financial statement: https://www.sfn.org/-/media/SfN/Documents/NEW-SfN/About/Annual-Report/Consolidated-Financial-Statements/SFN-Consolidated-2022-FS.pdf

They report annual income related to the meeting of around $7.7 million, compared to expenses of $5.1 million. There was additionally over $4 million in membership dues, and it's likely many members sign up specifically for the meeting each year (the cost of membership is less than the difference in meeting cost for members vs nonmembers). You can see in 2021 the meeting attendence was much lower and membership was as well.

However, as a non-profit, the proceeds go to fund the society's other programs. This particular organization is also run by professional nonprofit organizers, who it should be noted likely care little about the goals of the organization and instead want their numbers to reflect good fiscal management so they can build a resume and get their next job on the field.

My assumption is that these big conferences are not the norm. Much smaller conferences take in very little revenue, are organized by volunteers rather than professionals, and likely use nearly all of their funds for conference expenses. If there are leftover funds they are likely used to fund the next meeting.

Answer 4

It depends on the conference.

participation fee for a large annual European conference almost didn't change when the host country changed from one of the most expensive Western European countries to one of the most inexpensive Eastern European countries

This isn't that unusual. First, you need to realize that the registration fee is rarely the most significant expense of attending a conference: once you've paid for accommodation, travel and food, the registration fee is not necessarily that large, and is rarely a deciding factor in participating.

In Eastern Europe, some labs or institutes organize conferences specifically to make a profit. "Everybody" knows this and people still go there because noblesse oblige, i.e. people recognize that some are more fortunate than others and they know the leftover profits will be used to support legitimate activities of the lab or the institute.

Nevertheless, organizing a conference (especially a large conference) actually costs a lot more than people think. In particular, beyond the organizing committee, there might be administrative support needed to collect registration, deal with invitations, visas etc. This staff does not necessarily work for free, especially in countries with fewer resources.

In my experience the big society conferences are the most outrageously priced as registration pays to support the expenses of the society officers, and I have no sympathy for this kind of racket.

On the other hand, what I learned from my organizing conferences and in discussion with friends who have organized conferences, is that it can difficult to understand the constraints faced by the organizers. The overwhelming majority of organizers are doing their best, and the organizers - especially in developing or emerging countries - are more worried about loosing their reputation than loosing or making money: if the product is disappointing, it is the last time someone will show up at an event organized there.

Answer 5

The opportunity for achieving excessive profit is limited by market forces.

A large annual European conference is organized in the name of a specific global or European society, by an organization that's local to the venue.

The society is thus negotiating with a different local partner every year and they cannot afford the risk of damaging their brand by partnering with an incompetent or borderline corrupt organization who won't deliver on the expectations every now and then. The society looks at more than one target country, more than one potential partner for every annual conference that's less than 3 and more than 1 years ahead (assuming that it's desirable if they can eventually announce the next year's venue to the participants of the current year's conference).

The society will have some general, rather stable requirements, both technical and economic (non-paying participants, maximum participation fees, maximum student fees, venue characteristics), based on which all interested partners eventually prepare a formal proposal, the key part of which is the budget. The society then applies selection criteria which might not be formulated in advance, but they invariably include the proposed participation fee (lower is better). One candidate partner might offer a modern venue in an attractive city, another might be able to present a budget which appears both lean and not terribly cheap (perhaps because their university management or another local party appears to be effectively subsidizing the event, such as by charging less than the usual rate for the venue, as an investment into their own "brand" by hosting a large and prestigious conference). Everybody wants to be invited at a discount!

Market forces:

• The society has a monopoly over their own brand, but other credible parties can establish annual conferences independent of the society.
• The local organizers provide only limited accountability to the society and any profit or loss (intended or unintended) is theirs, but other credible parties may get in touch with the society and start competing for organizing the conference 2 or 3 years from now (and eventually prepare their own proposals), if they know how to do so more efficiently.
• The participants have the most freedom of all as they (or their sponsors) are ultimately paying the bill and there are so many conferences to choose between.

I'll conclude with two opinions for which I have no data.

• Where the profits are eventually modest, the potential for any corruption (of which the local organizer, or the society, would be the victims) is also modest.

• For academics who organize conferences, the career/fame/connection benefits probably way exceed any potential monetary benefits - especially if the conference is a prestigious one.

Answer 6

Many conferences in engineering are organized by the relevant professional body, e.g. IEEE, IChemE, etc.

These organizations have permanent staff for administration of membership services, CPD programmes, publications and conferences.

Seeing how these bodies have over the past 40 years been so quick to capitalize on their membership's economic potential in relation to credit cards, I would expect that the admin staff for conferences would seek to make a good margin on these events - if only to justify their own staffing numbers, salaries and benefits. They can always justify the profit by saying it may be used to subsidize small attendance CPD or support the organization's regional network.

It is rare to see conference entrepreneurship along the lines of Prof Santa Claus' ex-colleague. Yet individual or small group organization of special events (à la "Lorenzo's Oil") occasionally happen. I doubt if profit is the motive given the stresses of doing such events.

National conferences offer far less opportunity for hotel and block-flight swindles with most delegates making their own way (often piling into their PI's car) to the university venue, staying in student accommodation and 'dining' in the campus' cafeterias.

It wouldn't be so bad if the "profit" made on first world attendees were used to subsidize those from third-world countries who would otherwise not be able to come without saving for ~ 3 years.

Answer 7

It's like any other service -- they charge what people are willing to pay for the service they provide. If the fee they charge is too high, not many conferences would use their services, and if the fee were too low, they wouldn't be able to stay in business because they wouldn't make money. The fact that conference planners exist means that there is a happy medium.

Will they become wealthy? I don' think so. Conference planning is hard work, and if they managed to become wealthy, they're probably ready to retire.

That said, there are some perks to being a well reputed conference planner that might make it an attractive lifestyle for some people. For example, if you like to travel, it's probably a big plus. While it's still work, many hotels and resorts plugged into the conference circuit will provide conference planners with free visits to come evaluate their facility. Flights are a business expense, which can also support the desire to travel.