Everything you need to know about securing event ROI! Do you recoil in horror upon hearing the phrase “event ROI”? Don’t fear – you’re not alone. What’s become a concept shrouded in mystery is actually quite simple. Far simpler, in fact, than you may realise. While there’s never a guaranteed way to secure event ROI (think sudden natural disasters, or a volatile market that sees share prices nosedive), there is a basic formula that can be used to turn your corporate events into profitable exercises (acts of God notwithstanding).
The scary sounding phrase “event ROI” is nothing more than a basic mathematical formula
Any mathematical equation uses a specific formula to get an accurate answer. There are no ‘almosts’ or ‘kind ofs’ – your answer is either right, or wrong. So too is the process of calculating whether or not your corporate event resulted in ROI. The confusion comes in when event planners and their clients don’t have the same definition of event ROI.
Event ROI is any outcome that improves the bottom line
This return on investment can be achieved through several ways. While the generation of a profit in the form of sales performed as a result of someone having attended an event is the most oft-cited meaning of event ROI, there are several others. Event ROI could mean decreased production costs, achieved via motivated staff who felt valued at an internal corporate event. However, for the sake of keeping it simple, we’ll assume that you – and your clients – subscribe to the former.
First things first: define your objective
Nothing can be measured without a set goal or objective in place. If you don’t know what you’re working towards, you won’t be able to calculate whether your event was a success or not. Once you know what you need the outcome of your event to be, you’ll be able to create an event that will best facilitate this. For example, if your goal is to hit a certain sales target, your event needs to be able to convert your guests into customers.
Begin by measuring how much you spend on each guest
Event ROI is determined by the total amount spent on a guest. That is: your total event cost, divided by the number of guests. If, for example, your event costs R100 000, and your guest list consisted of 100 guests, your total spend on each guest would be R1000.
In order to calculate event ROI, it’s crucial that you use the right event tools to collate this information
If you invite the same guest to several events throughout the year, costing you a total of R5000 per person, they’ll each have to spend more than R5000 in order for your event to be deemed a profitable exercise. If you realise that some of your guests have never spent a cent on your brand, or spend less than their total cost to you, you’ll know to cut your losses and leave them off your future guest lists.
Your event is competing with countless others for same market share
Corporate events are a dime a dozen. If you want to make sure that your guests eventually buy into your brand, you’ll need to do everything you can to convince them to attend your event. Having a pre and post-event marketing campaign is vital if you want to extend the lifespan of your event experience. Whatever medium you use, make sure you’re creating as much anticipation prior to your event as possible. Once your event is over, thank your guests for attending and communicate with them in the weeks and months afterward. Remember that your guests all take different amounts of time to become a customer; some may invest in your brand immediately after the event, while others may take months until they spend money with you. By viewing your event as one part of a continued effort to facilitate event ROI, your chances of achieving this are that much higher.
Find out more about our Guest Concierge Management Software – a tool that enables companies including Distell, Coca Cola, Pzifer and many, many more – to create and manage events that result in event ROI.