Skyrocketing costs are putting unprecedented pressure on meeting and event professionals to stay on budget and still produce successful events. However, there are ways to alleviate the added costs.
Record-high inflation, rising fuel costs, supply chain issues, and labor shortages are driving double-digit price increases for meetings and events, according to a recent report by the Global Business Travel Association (GBTA).
The cost-per-attendee for meetings and events this year is expected to be around 25 percent higher than in 2019, and it’s forecasted to rise an additional 7 percent next year, with no relief in sight until 2024.
Hotel prices have already passed the 2019 levels and are expected to rise across all regions by 8.2 percent in 2023. In North America, food and beverage (F&B) is also experiencing a 70 percent per attendee increase this year.
What are some strategies to ensure the best return on investment (ROI) on the event objectives and spend in the face of steeply rising costs?
Book Further Out
“If you’re waiting three months before your meeting, two-thirds of the hotels won’t have availability, and those that do, will be charging top dollar, or you’ll have to arrive on a Sunday,” said Emily Kratt, managing director of INNOVATX Events. “There’s so much compression with groups that haven’t met in a few years; everything is selling out much quicker.”
Negotiate for Flexibility
It’s still hard to predict attendance because of the remote workforce and other factors, so Kratt stresses the importance of asking for more flexibility contractually. Block for maximum headcount and negotiate a flexible attrition policy to avoid running the risk of scrambling at the last minute and not being able to get rooms in this hypersaturated market or pay steep penalties. Kratt suggests having a candid conversation with the property, providing the history of the meeting pre-Covid and asking for a sliding scale, where at 90 days, the number could be reduced by 20 percent and another 10 percent at 30 days.
Be Intentional With F&B
The question of what you’re looking to accomplish has never been more vital, according to Tracy Stuckrath, founder of thrive! meetings and events. Instead of having a full-fledged dinner, a reception with sponsored cocktails, and cheaper mocktails, might be sufficient. Serving coffee and giving tea and decaf by request will further reduce the bill.
When planning menus, Stuckrath suggests researching other events taking place at the venue. Should a compatible event be taking place at the same time, selecting the same menu will save on labor and ingredients. Kratt expects the F&B costs to continue to rise in 2023. She recommend that planners negotiate with the property to honor the 2022 pricing.
Record for Hybrid
Kratt is seeing more clients replace live streaming with pre-recorded content. Planners are also being selective about which sessions to record future use in their content library. “It’s much more cost-effective than live streaming and enables you to have more control over what people are seeing,” she said.
Rent and Reuse
“Trade shows that may have typically done custom-builds are now using modular rental equipment that can be transformed and reused,” noted Jen Duffy, director of external communications for Encore. “It also increases the sustainability of the event by reducing materials that go to the landfill.” For example, at IMEX America, the company did away with carpet and used pipe and drape for its immersive exhibit. In addition, start talking with the production team to reduce transportation costs for equipment and staff.
Keep it Local and Casual
Jeans and sneakers are the new go-to’s of business attire, and events are following suit with more casual experiences. “Consider a live music venue or something connected with the local culture,” Kratt suggests. “It’s not as formal as in the past but memorable so that your attendees can have fun and remember it. It’s an excellent way to support local businesses and artists. It doesn’t cost much money but has a great impact.”