Despite its charms for corporate events, Madame Tussaud's initial rental fee—$30,000 to close the whole place for a private party—was just too high for many of event planner Howard Givner's clients in this tough economic climate.
But in a sign of new price flexibility in the special events industry, the Times Square attraction now offers lower price options, like $10,000 to $12,000 to rent a single gallery with wax likenesses of Bette Midler and former Mayor Rudolph Giuliani. Planners like Givner, president of event firm Paint the Town Red, which specializes in matching clients with venues, are responding positively. "When that happened, we booked three or four events there," he says.
Businesses have been paring back event budgets for more than two years. As the important fall season gets underway, planners are trying to do more with less yet again and vendors are trying to find ways to trim prices just a little bit more. "Our strategy is to be as flexible as possible," says Janine DiGioacchino, general manager of Madame Tussaud's. "Almost every day we quote the $30,000 price and then we say we can rent just one room."
Rachael Dworsky, owner of destination management firm Connections Unlimited, says one pharmaceutical client spent $500 per person last year for a holiday dinner at a top New York hotel. This year the budget has shrunk to $375 per person. She's staging a buffet lunch instead and is talking to cheaper venues.
With a $95,000 budget for a 200-person dinner for a financial services firm in October, Dworsky suggested making the event a cocktail party instead, adding room for 50 more guests for the same price. "The per-person cost went down," she says. "[And guests] are happy to go out to a cocktail party rather than a four-hour dinner."
Throughout the industry, competition for bookings is intense, with new pressure from several hotels with event spaces that have opened in the city recently, including the Westin New York—Times Square and the Ritz-Carlton New York—Battery Park. And ailing restaurants are looking to fill their tables with event business instead.
Givner, whose firm worked on more than 450 events and parties last year, says he's being barraged with discount offers from vendors, and invitations for free meals to lure his business.
Vendors are trying to retain longtime clients, even if it means lower profits. At the Four Seasons restaurant, partner Julian Niccolini is willing to shave his profit on wine for loyal customers. "If they say they can't afford to spend $150 for a particular wine, I may bring it down to $110 a bottle," he says.
Niccolini is also offering new fixed-price options, substituting smoked salmon for caviar and charging $100 versus $125 per person. "People want to save money but they still want to have their party here. We want to keep them here for when things get better, so we definitely lower our prices," he says.
The Glazier Group, which owns venues including Bridgewaters and Twenty Four Fifth, already trimmed prices by as much as 20 percent since the bottom fell out of corporate entertaining after the September 11 terrorist attacks. Now, some clients are asking for another round of deals. Co-owner Peter Glazier says he is matching prices when potential clients report better deals from competitors.
The company has created some less expensive options by eliminating a few items from a buffet, and deploying one server for 12 guests instead of its typical 10. It is a delicate dance. "It's a very difficult position for us," says co-owner Penny Glazier. "We've worked long and hard to build our reputation. We don't want to compromise our quality."
—Louise Kramer
5 Tips for Cutting Costs
TRY A SUPPER CLUB
A venue with a stage, sound system and décor already built in can save cash and seem like a fun change. But booking a lesser hotel than you used in big-spending years can be "an obvious step down," says Howard Givner, president of Paint the Town Red.
LIMIT DECOR
That’s what Elizabeth Gaerlan, an account supervisor for PR firm Edelman, id for the recent launch of dark chocolate Hershey's Kisses at the Metropolitan Pavilion. The centerpiece was a 6,759-pound chocolate kiss. "We felt we really didn’t need peripheral decorations," she says.
GO BACK FOR SECONDS
"Repeat business is always a great reason to give planners a break," says Jim Kirsch, president and chief executive of catering firm Abigail Kirsch Culinary Productions.
PIGGYBACK ON ANOTHER PARTY
Order the same menu as another, simultaneous event. Givner did that for a TV wrap party, where guests got the same food as an investment bank. "It’s not like your guests are going to know this is exactly what they’re having in the other room," he says.
DO LUNCH
Rachael Dworsky, owner of Connections Unlimited, says lunch can be 25 percent cheaper than dinner—and just as nice. "If you scale back dinner, people notice," she says.
—L.K.
These stories originally appeared in the fall 2003 issue of the BiZBash Event Style Reporter newspaper.
