Recently a number of my industry colleagues have had to make decisions about whether or not to cancel their events which were struggling. In my twenty-six years in this industry, I can count on one hand the events that I’ve had to cancel after launch, so I count myself lucky on mostly avoiding the scenario.
What are the factors that should determine whether you should cancel event, once you are rolling?
1) Have you done your research?
The biggest reason to prompt an event’s cancellation is not hitting your numbers. If you foresee a financial loss that could not be tolerated or if running an event risks a greater loss than what would be incurred in terminating it, a decision must be made. This situation usually stems from the absence of detailed surveys of both potential sponsors/exhibitors that gauge whether they will support your show financially. If you can’t accurately forecast your exhibit revenue before launch, you’re in for a harrowing, white knuckle ride.
Likewise, on the attendee side, have you done response testing to see the interest level? Are you right about conference/expo fees to charge – or not? Do you have an ‘event resume’ that summarizes the event and its value on a single page? Do you know the acquisition cost of each attendee and established the appropriate marketing budget?
These are just a few of the things to consider. Check out a past article, inspired by Sean Guerre, for more insights on this area.
2) What is your rebook rate?
At a former company, we achieved a 100% rebook rate on most large events, primarily because we were selling many shows 24 months in advance. Rebooking was our metric of success. But if your rebook rate is below 50% it‘s that your event is churning and burning exhibitors. Do you know why this is happening? Remember that rebooking current customers frees your time during the year to focus on getting new ones.
3) What do your analytics say?
Are you getting between 10-20% open rates on each event email you send out? If not it could a lack of interest in what you’re doing. What do your website page views look like? If your analytics are on the downswing, it may be a sign it’s time to pull the plug.
4) How many financial milestones have you missed?
This is a hard and fast rule for Sean, as noted in the mentioned article. You must be tough on yourself. Once you’ve missed three or more important financial milestones, it’s time to look carefully whether to pull the plug on your event.
5) How many attendee milestones have you missed?
What is the ‘tipping point’ in terms of the number of attendees needed to satisfy your sponsors and your financial expectations? If your goal is to get 400 buyers to your event, will you be OK with just 250? If you think you can hit your tipping point number, it may be best to keep on going.
6) Can you absorb the financial costs of cancellation?
Is there a large hotel or facility contract that you must swallow if you cancel? Do you have labor or other fixed costs that you can’t recover? Or have you bootstrapped things in a way that allows you to back out gracefully without losing your shirt?
7) Can you afford reputationally to cancel or not the event?
Once you cancel an event, it’s quite hard, if not impossible, to resuscitate it. That said, consider your reputation if you run an event with sparse traffic in the exhibit hall and empty seats at the keynote? You must consider your relationships with key stakeholders if you do or don’t cancel.
8) What is the opportunity cost in continuing the event?
Sometimes the best reason to cancel an event is that it frees you to pursue other opportunities or invest more effort on the healthier events in your portfolio. What is the best decision?
Canceling an event is something I hope you never have to do. It’s extremely painful and the fallout can last for months, particularly if it’s handled poorly. The best antidote to canceling an event is doing your homework beforehand. Before a new event kicks off, do pre-launch attendee and exhibitor tests and think seriously about the opportunity costs and the upside/downside of moving forward. On an existing event, do the evaluation – financially and otherwise – before deciding to continue.
Let me close with a tip of my hat to those who have cancelled an event for the right reasons: when it saves the time and money of speakers, sponsors, attendees and others who will pay the price if you continue with something that is just going to be bad….
For extra credit reading from Lawrence Dvorchik on this subject:
and a few from me:
http://theeventmechanic.com/index.php/2016/04/15/2-huge-mistakes-will-kill-even-strongest-event/