The company keeps data on the effectiveness of advertising. There is one key set of data in the company's files that you should use. It is a graph showing the expected return on advertising spend. It shows the amount spent per person (for the total capacity of the venue) against the percentage of ticket sales expected. You will notice that the more you spend, the higher the percentage of sales. Notice the curve of the graph shoes that even with no advertising you will sell some tickets and as you get close to the highest figure of £2 per person, there is very little improvement for spending more.
As an example, I'm going to do some calculations for the Civic Hall venue. Advertising Spend
The Civic Hall holds 482 people. I'm going to allow for an advertising spend of 70p per person.
So, I will spend a total of 482 × 0.70 = £337.40
Ticket Sales
Reading from the graph, at an advertising spend of 0.7, you would expect to sell (roughly) 74% of the tickets.
That's 0.74 × 482 = 356.68. Rounded up to the next whole figure, that's 357.
This means that ...
I would expect to sell 357 tickets in the Civic Hall, if I spend £337.40 on advertising. Now, you should work out the total advertising spend and the corresponding expected total ticket sales at the Assembly Rooms if you spend exactly 50p per person. Remember that, in the previous exercise, we established that the Assembly Rooms will take 710 people.
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