By now the effects of the economic downturn on the event industry are not news—corporate planners know they’re expected to do more with less, even if their companies’ chief executives support events as part of their business strategy. Planners must become more accountable to high-level management for every dollar they spend; if they can’t prove the relevancy of their jobs with evidence that their event investments are working, they’re likely to face even more budget cuts—or worse, the elimination of their jobs.
But planners have an effective tool to prevent those bleak circumstances before they happen: careful measurement of return on investment (ROI). And it’s a solution that’s gaining momentum all around the industry. “[High-level] management doesn’t often understand the value of events and trade shows—maybe it constituted one paragraph in their college marketing textbooks,” says Mim Goldberg, president of measurement firm Marketech. “A measurable return is needed to validate events’ importance for them.”
A 2004 survey of 700 event professionals by Meeting Professionals International and George P. Johnson reveals that event marketing accounts for an average of 23 percent of corporate marketing budgets, and that 47 percent of respondents believe event marketing achieves a greater ROI than other forms of marketing communications. But many corporate planners have until now measured the success of their events in only nonmeasurable, nonfinancial ways: “My trade show booth looked great,” “My party was packed,” or “Our event got tons of media coverage.”
While these factors might indicate a successful event, they don’t prove it was financially beneficial, whereas planners whose measurement includes hard numbers are 50 percent more likely to have their event marketing budgets increased, the survey revealed. Planners are coming up with ways to make it happen: In an interactive survey conducted at a planners’ luncheon at the BiZBash Event Style Show in October, 58 percent of respondents said they had more benchmarks to measure the success of their events than they did three
years ago.
Measuring event success is not just a means of self-preservation for planners and their budgets. “If planners measure, they can identify their strengths and weaknesses and improve their performance,” says Skip Cox, president of Exhibit Surveys Inc., a firm that specializes in trade show diagnostic tools. “Measurement provides support information for strategic and tactical decision making.”
As marketing and event departments become savvier, they are looking for ways to manage their expanding responsibilities. “We want to measure ROI more to improve than to justify our roles as planners,” says Cynthia Jacquet, assistant manager of conference and concierge services for Clifford Chance, a Midtown law firm with planners dedicated to dozens of on- and off-site events annually. The planning team wants to see its department expand and flourish—creating bigger events with greater impact, possibly with even higher budgets—and the team knows that ROI data can encourage that development.
A number of tools are now available for planners to meet the metrics mandate. Trade show planners are starting their event measurement data collection well before their events, with preshow surveys that often offer respondents incentives and prizes. Marketech offers a software program that allows trade show planners to enter all data related to event production (dollars spent on exhibition, number of attendees expected, etc.) into an equation, which yields numeric results—dollars
spent per visitor reached, number of leads generated, sales generated, and more.
The same premises can be applied to a variety of events and marketing strategies. Consider a hypothetical product launch event for customers and prospects: If 103 guests are invited, 80 show up, and the investment in the party was $5,750, the cost per customer reached is $71.85. If the staff finds the event generated $750,000 in new business that the sales team can eventually close, the potential ROI is $130 for every dollar invested—there’s nothing soft about those numbers.
Some planners are using focus groups to determine an event’s effectiveness, collecting information from attendees before and after the day of the event. “You can do an exit interview to determine what prompted guests’ attendance, what promotions they saw that attracted them, their perceptions of the value of the event, and their willingness to participate in future events,” says Marketech partner Marc Goldberg.
While events may bring the highest ROI of all marketing strategies, the health of the industry depends on this essential measurement data. Take DaimlerChrysler, which enlisted the help of Michigan-based event measurement firm Event Metrics Company to measure the success of its Camp Jeep NY event at the Javits Center during the 2004 New York International Auto Show. “Measurement is extremely important—we need to track and make sure we’re spending our money wisely so that we can be profitable for the shareholders,” says DaimlerChrysler’s Suraya DeSante.
To make it happen, Chrysler/Jeep events manager Lou Bitonti worked with Event Metrics to create a three-tiered procedure for collecting data—on-site computer-based questionnaires, telephone followups, and focus groups—which concluded that the off-road simulation course was a success. Traffic at the event was three times the anticipated number, bringing in 300,000 visitors and 30,000 Jeep rides. Visitors averaged 22 minutes at the exhibit, versus only seven minutes at other automakers’ exhibits and, perhaps most significantly, more than 2 percent of visitors purchased a Chrysler car within three months of the show. With ROI like that, what executive could justify cutting future event funding? You do the math.
—Alesandra Dubin
