Launching an Event: How to Avoid Financial Disaster

In theory, launching an event should not be too difficult. The steps of a launch can be laid out much like a pilot’s nighttime view of an airport runway’s landing lights. If you are methodical in execution, analysis and do things in the proper order, you should be successful. That typically is how it happens, that is until you reach the most important step which is often ignored- testing.

Here is the sequence:

 

1)  Establish the Idea

You need an idea for your event to differentiate it from what already exists. The idea must be smarter or more exciting in ways that will attract better participants or a greater number of them. Or it offers a new format that better suits the market. Most new events merely mimic what already exists (and thus start at a disadvantage.) Invest the time needed to ensure that your event will be different in meaningful ways, that it can attract attendees and exhibitors, and that you can make money doing it!

 
2)  Develop an Event Resume
 
Once you have the idea, write up a one-pager (the Event Resume) that answers the following questions:
 

• What is the event?

• Where and when does it take place?

• How many attendees/exhibitors are expected?

• Why it is compelling?

• For whom is it intended?

• What benefits will an exhibitor get through participating?

• What benefits will event attendees receive?

• How much will it cost for an attendee or exhibitor to participate?

 

The Event Resume should be self-explanatory. If a prospect can’t determine by reading it (without your additional assistance) that they should participate, then it needs further review and refining. Without this document’s ability to sell your new event, your launch will likely fail. Building an effective Event Resume is difficult, but if you can’t (or won’t) clearly state your value proposition, your marketing outreach will be weakened.


3) Create Champions

Now that you’ve persuaded yourself and your team to move forward, you need to get 3-4 others whose judgment you respect. They must agree that the event you’ve conjured up is worth doing, offering value not already available in the market. That validation should help you justify the event costs (which could be huge) and affirm that the financial risk is worth taking.


4) Establish a Specific Venue

Once you’ve picked a prospective date, make it real with specifics about available venue options, given your event’s ‘footprint’ in terms of both content and the projected number of attendees and exhibitors. What financial commitment is required to secure that venue, including the hotel room blocks?


5) Develop a Preliminary Budget

Given the above, you should estimate expenses in terms of room rental, audio-visual requirement, food and beverage, exhibit area, staff hotel rooms, airfares, related T&E, etc. Put those costs into a spreadsheet, together with projected revenues. This will determine whether 1) you can afford to do the event, 2) what your expected profits would be, and 3) the necessary investment and cash flow assumptions associated with producing it.

 

6) Conduct True Attendee Testing

Here’s where most organizers fall short with their research. What should happen is that you test the viability of your event with prospects in your database to confirm that your attendance assumptions are correct. Despite the means available to event organizers, too often they fail to market test new event ideas using their databases. And if they do test, they have no idea about how to evaluate the results to determine whether to move forward. I recently attended an event industry conference at which a panel convened specifically about launching events all agreed that their launch decisions were based on a ‘gut feeling.’ How scary- and dangerous – is that?

If you ask, “Hey Warwick, I don’t want to be like that. How do I test market a new event idea?” Here would be my guidance:
 
• Develop a list of anyone who might have a legitimate interest in your event. The larger the list, the better.

• Send out an email blast to this list to confirm interest and gauge the strength of that interest.

• Ensure you have a great call-to-action (e.g., “to get more information when it’s available, click here” on the email) to ensure that positive responses are actionable. Note that a good result is a 20% open rate and a 15% click-to-open percentage. Anything better suggests you will attract enough attendees, while anything around those percentages or less suggests there’s insufficient interest.

7)  Do Some Exhibitor Revenue Testing
 
Can you increase the exhibitor revenue that is part of your assumptions? Pick the top 20 most relevant exhibitor prospects and have your best salesperson set up calls or meetings with each decision maker. Get feedback to confirm whether they would support the event financially. Compile the results to see whether your exhibit revenue expectations are real or merely a pipe dream.

8) Refine the Event Resume and Budget
 
Perhaps the preceding steps have suggested that you must adjust the concept for your event. Or you’ve discovered that initial revenue projections are overly optimistic. Redo the numbers and see whether they are still compelling for all the work it will take to get this going. Then look in the mirror and confirm that going forward makes sense.

9)    Launch!
 
If all the above testing has confirmed your initial confidence, then it’s clearer that you should launch. But if the results are only neutral or something less, consider delaying the initiative until you develop a better approach. Or perhaps you should consider shelving the idea altogether.
 

If all of these steps sound like a hassle, imagine how you would feel if you chose to launch without doing your homework and ended up with a turkey of an event.

Be brave! But be smart! Your unique position is your visibility into the future and your confidence in the data that supports that vision. So let that be a guide in your building something great.

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