How to Set a Budget in a Post-Pandemic World
Doing more with less is nothing new for event planners. But with so many mitigating factors leading to uncertainty up to the big day, the cost of doing business isn’t going to shrink — even if your budget has.
The world is reopening but the people in it are not the same as before the pandemic. Travel is a novelty again, but working from home has become an expectation rather than a perk. Results also show remote working didn’t limit productivity, which is music to CEO’s ears but also raises the eyebrows of CFOs when a worker seeks permission to attend a conference or trade show in person.
“We've changed our lives in many ways and we've gotten used to all these new habits,” said Eric Holmen, recently promoted from chief revenue officer to CEO of Splash. “It’s a lot to give up when asking an attendee to break out of this nice pattern of being at home just for a risk that your event might be worth it.”
Just as attendees and exhibitors will question costs, so will associations and corporations not fully recovered from last year’s shutdown. Event tech platform Bizzabo reports that 66% of event organizers anticipate budget cuts for their hybrid and virtual events in 2021. Meanwhile, it predicts “costs will go up, even double in the case of tech.” Oh, and as a kicker, your revenue will shrink, warns Bizzabo.
Somehow, the person in the middle of this — the planner — needs to thread the needle to create a wow factor for attendees while staying within budget and maintaining safety protocols that are not likely to recede for the foreseeable future.
Here is how to make the most of what’s ahead:
Trust Your Instincts
Would you believe a used car salesman if he said a 1999 Buick rode better than a 2021 Prius? Just as you should be cautious in that situation, it is buyer beware when it comes to event technology and safety protocols. Never has the market been better for companies in both fields, and they are not about to let the moment pass.
“Planners should question any vendor that tells them what safety tactics to implement, especially if they are expensive,” warned Ryan Costello, co-founder of Event Farm and chief strategy officer of MemberSuite. “Through strategic planning and execution, planners can safely host events while maintaining a budget that should not exceed more than 30% of pre-pandemic rates.”
Be Smart About Safety
Unless your event is only admitting vaccinated attendees, you’ll need a layered approach to guard against a COVID-19 outbreak that will not only risk your group’s health but also disrupt your event and potentially damage your brand’s value. Costello advised to stick to two or three safety measures and hold fast to them. Pay for them by charging attendees a fee that you feel will be covered by sponsorships, fees and other forms of revenue (membership dues, for example).
Airfare and hotel rooms are among the biggest ticket items on the bottom line. Holmen’s solution is to bring the events to attendees through a series of roadshows, coupled with digital events to expand the audience and awareness. “We're approaching [events] now like six week periods,” he said. “Start heavy on virtual at the start, go, go hit the road for four weeks, visit the key cities where you can localize and build strong connections. And then summarize at the end with virtual.”
Splash leadership, as a rule of thumb, typically advocates for as few attendees as possible. The idea is the audience will get much more out of the event when the group is an intimate size. As a bonus, this is another way to lower the travel budget yet still have room to splurge a little on those you do host. It also takes some pressure off your target audience still iffy about hopping on a plan. “The highest ROI events that we see are around 50 to 55 attendees,” said Holmen. “If you get above that, and you see ROI drop very, very steeply. That was true even before the pandemic.”
Don’t Skimp on Digital
We all love face-to-face but poor production and/or boring content are going to make your organization look bad. More importantly, a poor impression tarnishes the brand, which has long-term consequences. That’s why Brad Nierenberg, creator of the virtual, non-gambling engagement platform Poker 501 and CEO of RedPeg Marketing, said going all-in will pay off down the line. “The investment is in bringing the digital attendee over to a physical attendee next year,” he said. “It's essential to have a ‘wow’ moment that brings people back next year or moves them from digital to physical.”
What Are Sponsors For…
If not offsetting some of the costs? It’s in a sponsor's best interest to develop an activation that is going to energize your audience, and not just for the duration of a physical event. With virtual, that brand recognition has the potential to last for a far longer period. That long-term buy-in provides benefits for your event and your client fitting the bill. Said Holmen, “It's about driving a pipeline, ultimately, and your partners are looking for that just as much as you are.”
Save for a Rainy Day
With so much unknown when it comes to variants, job status and other unpredictable factors, allocating every last penny too early in the game might cost you more later. Ben Anthonisz, head of customer education at Bizzabo recommends keeping a 20% contingency budget to cover last-minute costs.
Start With a Plan
Rumor has it you are a planner. So here is where you play to your strengths. Knowing where to begin starts with mapping out your entire event, recommends Bizzabo. Put a number on what you need for venue procurement, technology, marketing, F&B, etc. Highlight the variables and get to work. Good luck!