Surprise, surprise! Budgets are the number one concern of planners as we head into the New Year, according to Successful Meetings' recent survey that asked readers to choose the topic of this story. To allay some fears, answer some questions, and help planners to better strategize, we spoke with industry members and experts to ask what their best tips, tricks, and tactics are for dealing with the "New Normal."
According to the most recent MPI Business Barometer, released in October, budgets have stabilized. Fortyone percent of respondents indicated that their meetings spend is flat compared to spend one year ago, with 17 percent indicating a 1-5 percent increase and 16 percent indicating a 1-5 percent decrease. Overall spend per event declined very slightly and other factors, such as short lead times and high travel costs, continue to impact planners.
"We're definitely seeing a trend toward higher costs with room rates, F&B, and travel costs, and because of shorter lead times, there is less time to barter and deal," says Theresa Davis, MPI's director of strategic communications.
So here are some strategies from the experts on how to make the most of your budget—no matter how small.
Trends That Don't Burn Cash
There is room to make small but substantive changes to your budget by incorporating appropriate web-based programs, adding a corporate social responsibility (CSR) element, and maintaining a focus on the attendee experience.
"CSR has a direct impact on the bottom line," says Mike Malinchok, founder and president of S2K Consulting, LLC, a strategic meetings management consulting company based in Newton, PA. "A lot of organizations are making the choice that while, historically, attendees got really nice gifts bags, this year there was an envelope in each room saying we made a donation on your behalf to an organization that gives wheelchairs to children in need. Then they included a picture of the child who received a wheelchair. Everyone feels good and it's cheaper."
CSR has added a new dimension to what a networking or even a training event can be. "This whole focus on CSR and green means there might be opportunities to do a project instead of hiring a teambuilding company and it's a little cheaper and better for you. We have some new opportunities to reshape how we're doing meetings. There are ways to be a better citizen and save some money. As a net result, you enhance the whole experience," adds Sue Tinnish, assistant professor at Kendall College's hospitality management school in Chicago and a past president of MPI's Chicago chapter.
On the technology side, programs have "evolved to the point where you can have a powerful and impactful event online," notes Malinchok. "It's a very viable way to increase engagement, but doesn't involve travel or food and beverage costs. And you can be a virtual attendee at our conference for, say, half the cost. It's incremental revenue and uses content you are creating anyway."
Many planners, however, continue to fear web-based events as a threat to their job security, a notion Malinchok acknowledges but says is unfounded. "There is a lot fear and trepidation around things like this. But this is another level of connection, communica tion, and engagement, which is what meetings are all about anyway."
Nick Romano, president of Atlantabased strategic meetings management software provider SignUp4 does caution planners to "look for the total cost of ownership, especially with software. Oftentimes in the meetings space, much like travel, there are costs that can get out of control quickly."
Look to Attendees and Vendors
Experts advise using attendee perception as a tool to drive a budget strategy. "Think about your audience and what are their expectations for the event," says Tinnish. "Think about what they see and don't see" and make decisions accordingly. For example, for basic events, talk to the facility about using decor items it has in-house.
And take advantage of the experience your vendors have. In order to get the most out of a budget, Linda Swindling, president of Dallas-based Journey On, a speaking, training, and consulting company, recommends asking vendors: What have other clients asked you to do that worked? What other things have you seen? What should I have asked you that I didn't?
The Procurement Approach
While it's not a good idea to view meetings and events solely as commodities, it is a good idea to incorporate the perspective of a procurement department into your approach. Since your budget was likely bled dry of every possible extraneous line item by the end of last year, focus has now shifted to strategy, and this emphasis on the value of the meeting —now both in terms of dollar amount and effectiveness—presents challenges and opportunities to planners.
"Over the past few years there has been a focus on line items, but there's been a real shift this year in that people are realizing that meetings aren't going away and we need to look at where we're spending the money and what the return is from a business perspective," explains Malinchok.
But this emphasis on returns does not translate into an increased focus on ROI as it is typically defined. "Often meetings or events don't need to be measured at the ROI level to truly demonstrate effectiveness," says Tinnish. This sentiment was echoed by other experts, who emphasized that there are a variety of ways for planners to measure the value of a meeting or event without using traditional ROI calculations.
The first thing to do is "establish return metrics," says Malinchok. "With every event we want to see a 10 percent boost in production. Or, for a sales incentive, the return will be based on the sales leading up to it. So, did it work? A customer event might be different; did we see a boost in sales after?"
"The challenge is that sometimes our stakeholders are difficult to pin down in terms of what they really want. As meeting professionals we have to be ready to guide those conversations. You need hard, measurable goals," adds Tinnish.
"A lot of planners come in late [in the process] and end up trying to fulfill a mission that has not been clearly defined. So they need to not be shy," explains Swindling. "Say something like, 'What do you want the attendees to say, feel, do, or think as they are leaving— what are the top two or three things?'"
"People are being rational again," notes Malinchok. "The pendulum has swung back to 'It's all about the attendee.' We want the attendee to 'do' something. And all of the savings in the world will be irrelevant if the attendee doesn't do what we want them to do."
Originally published Dec. 1, 2010