What’s happening in the kitchen is the same as what’s happening in the ballroom. With the price of groceries sky-high, cooks have had to get creative in their meal prep to continue to delight family, friends, or customers. The same is true for event planners who are expected to deliver high-quality experiences in the face of budget cuts or the same budget [which is not really the same due to rising costs]. So just like the cook, event planners need to get creative about their event strategy and preparation.
Rising costs in the event industry isn’t news any longer, it’s a fact of doing business now and for the foreseeable future. Many event professionals first confronted hard evidence on this fact at CEMA Summit ’22 in Nashville when Michael Dominquez, President & CEO of ALHI, shared his now infamous ‘inflation burger’ PowerPoint slide. Michael presented an image of a hamburger with the relative increases of each ingredient needed to make a quality burger. It was the perfect metaphor for rising hard costs in the event business and kicked off discussions everywhere about the increased prices of the ‘ingredients’ [eg. labor, venues costs, etc.] to create a high-quality event.
How can event planners cope with this challenge, which is metaphorically the same as the cooks, but in reality much more complex. For starters, they can seek help from their agency partners. As costs rise, the importance of expertise and deep experience becomes more critical than ever. But perhaps the most effective tool to combat budget pressure is creativity. And this type of creative thinking is also within the domain of experiential agencies. Here’s a case in point.
We helped one of our clients wrestling with their budget challenge by changing how we created video testimonials for their SKO. To reduce costs, we swapped location shoots of each of the subjects to recording each of the subjects on-site at the SKO venue just before the event started. By prioritizing flexibility, and leveraging technology wisely, we were able to help save almost $100,000 on this one element of the show. The videos were engaging and effectively contributed to the overall success of the event as planned.
Strategies for Mitigating Costs
Despite the challenges, companies and event planners can employ various strategies to manage rising costs effectively:
Prioritize Flexibility: Being open to changes, like shooting subjects on location vs traveling crews. Flexibility in event production can be huge expense reducer. On the planning end, if an event can repositioned to an off-peak month, Bizzabo reports 20%-30% savings on hotel and catering rates.
Leverage Technology Wisely: Using XR or green screen backdrops can save precious dollars. Strategically focusing on platforms that align with goals can reduce expense. In the digital or hybrid event scenarios, pre-recorded sessions can lower AV costs compared to fully live-streamed events.
Focus on Core Goals: The messaging ‘IS’ the thing. Develop plans around making an impact relative to budget first. Also, companies are finding value in prioritizing intimate, high-impact events rather than sprawling conferences. This approach helps control budgets while maintaining meaningful engagement.
·Actively Managing Hard Costs: According to EventMB’s 2024 Industry Trends Report venue costs have increased by an average of 25% since 2021 and labor costs have increased 20-30% since the pandemic. Event organizers should use every resource at their disposal to actively manage these costs. For production related fees, your agency can bring additional expertise and leverage to negotiate down items such as rigging, power, local labor, and on-site supervisor fees.
Maximizing Agency/Partner Value: Brands can maximize the value of their experiential agency partnerships through co-innovation, where both parties work together to create solutions that benefit company business objectives. This involves establishing open communication, sharing insights, and aligning on goals to enhance overall effectiveness and efficiency of event production while driving greater audience engagement.
Why is our first post of 2025 about creative problem solving for clients facing budget challenges?
Because this new emphasis on ‘problem solving’ via event design is what we do and we’re ready to help ‘creatively’ to meet both internal budget requirements and attendee expectations. Another reason is to underscore that experiential agency rates themselves are part of the expense mix, and our modern agency model is helping our clients by providing value to them on every level.
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