Tactics for Building Profitable Events
“No longer are they ancillary, they’re primary,” says Martha Schwartz, senior vice president, Custom Solutions Group, Ziff Davis Media. She’s talking about live events, and she can’t say enough about their brand- and profit-building abilities in the publishing world—and she isn’t the only one. Bob Cohen, publisher of LPI Media, refers to events as the future of profits in this business. As far as he’s concerned, publications can no longer thrive without sufficient face-to-face interaction.
American Business Media recently reported that trade shows overtook print magazines as the business-to-business media industry’s top revenue-producer in 2006—a first for face-to-face events. Trade shows accounted for 36 percent ($11.3 billion) of industry revenue, just above magazines’ 35 percent.
Over the years, Ziff Davis, LPI Media and a few others interviewed by Publishing Executive have pulled off enough events to claim a level of expertise on the subject. They have the process down to a science and, here, reveal their know-how for creating successful affairs.
Profits will come in time, but be prepared to struggle a bit at first—financially and logistically.
Cohen, whose group oversees consumer magazines such as The Advocate and Out, says stumbling blocks are aplenty in trying to get advertisers to underwrite brand-new events, and it could come down to the wire before getting them to commit.
“The first year is a nail-biting one,” says Cohen. “Publishers need to carefully scale new events, hold back and gauge interest so as to reduce risk until momentum is gained.”
As far as making a profit the first year, Cohen says don’t count on it.
Bill Howell, vice president and general manager, 1105 Government Information Group (which produces 40 events annually), says that because there is so much to learn initially, breaking even would be a reasonable expectation.
“It’s also important to know that many folks who commit don’t show up. They might get a call the morning of an event with news of a meltdown at the workplace, and there’s just nothing a publisher can do about that,” says Howell.
The staff at North American Publishing Co.—which manages the Publishing Executive Conference and Expo and the Book Business Conference and Expo—says they consider themselves lucky if they lose only one or two speakers the week leading up to the event or once the show has started. With approximately 150 speakers between the two events (which are co-located and run simultaneously), the chance for work or personal emergencies to occur is fairly high.
If You Build It ...
To maximize attendance, Schwartz urges publishers to focus on irresistible topics and speakers. She says if you have the right keynotes and content, the audience will come.
“This means b-to-b publishers should stay away from presentations that just pitch products,” Schwartz says. “Instead, bring in relevant experts with appropriate backgrounds.”
Schwartz’s group holds summits—such as its annual CIO Summit—conferences, road shows and more, which bring together IT executives, editors and analysts. As far as who is targeted for attendance, Schwartz says various subscriber lists—which, all told, consist of 3.5 million names—are utilized.
Cohen’s company uses e-mail blasts as well, in addition to mailed invitations to its list of advertisers and relevant and influential members of the press.
LPI Media puts on in-store shopping events for which stores such as Macy’s, Levi’s and Armani Exchange will pay a fee. For example, LPI did an event with Levi’s in Union Square, N.Y., for which 200 guests arrived and more than $5,000 in merchandise was sold in two hours. For the in-store events, LPI hands out its magazines. Also, large posters of magazine covers are mounted throughout. Banners, posters, magazines and DVD loops can be seen at many events.
The publisher also holds an annual, invitation-only Out 100 party, celebrating the people featured in its “Out 100” list in its December issue each year.
Still, there are pressures in coaxing potential attendees out of their offices to attend events.
“This is certainly true in the private and public sector,” says Cohen. “We have to give people a strong value proposition, which typically revolves around an education component that will help attendees do their jobs better, more quickly and more effectively.”
Offering a series of best practices seminars seems to work very well for 1105, which presents such seminars at many of its conferences as well as at FOSE, its yearly government-technology trade show.
“A government manager can … listen to others discuss pitfalls and successes on the job, and then go back with 10 takeaways regarding the road to success,” says Howell. “This is how branding and profits are built. It’s about generating a stellar reputation within your community through meaningful content.”
What Price is Right?
While content is an important determinant for attendees and sponsors, so is cost. Pricing an event too high can scare off potential registrants, while pricing it too low could suggest a lackluster affair and mean a poor return on investment.
Having said that, putting a price tag on events is completely determined by audience. Case in point, there is no cost for many attendees of 1105’s FOSE.
“Training dollars are extremely difficult to obtain in the federal government, so we simply will not charge government employees to attend,” says Howell. “The money would be coming out of their own pockets, and government employees aren’t exactly overpaid for their work.”
At the same time, Howell says certain educational events come with a fee. He said some executive events cost $2,000, and events catering to lower-paying positions might cost from $195 to $400.
Schwartz, who is accustomed to servicing a very different community, says attendee costs could range from $50 for a smaller, one-day event to $2,000 for a three-day event.
However, the big dollars come from sponsorship. “A three-day cornerstone sponsor might pay $200,000 to show up at one of our events,” she says. “Others pay between $50,000 and $75,000 depending on the level of interaction they’re looking for.”
Schwartz says it’s all about how much time those sponsors get to spend with their audiences. Sponsors desiring just a tabletop display might only pay $5,000.
“But we want our sponsors to go in and secure 20 appointments with potential clients. So, for a cost of about $30,000, sponsors get a ‘birds-of-a-feather’ table for lunch, where they are matched up with appropriate persons,” she says. “At the highest levels, sponsors get speaking opportunities as well as [access] to sought-after database lists.”
Expect the Unexpected
Just because sponsors are in place and attendees have registered, odds are that something will go wrong.
“In some ways, the event business is like show business,” says Howell. “You don’t really want to look behind the curtain to see the chaos.”
With such chaos often comes disaster, adds Howell, who suggests hiring events experts who know what to anticipate.
Schwartz agrees. “Murphy’s Law applies to events,” she says. “You’ve got to think about things like the weather in certain cities and hotels not meeting your expectations. All of these factors can affect your bottom line and your brand.”
She recalls the first year her group planned an event only to discover it was up against another huge trade show going on in the same city. When it came to hotel space and travel arrangements, a lot of hurdles had to be overcome.
“It’s just a matter of taking things in stride,” says Schwartz. “But if there is value in the event, people forget that the chicken didn’t taste good.”
Hiring contractors also helps. Howell says that in-house he employs eight people for marketing and logistics for 40 events annually, but hires outside contractors—including a half dozen for conferences and several hundred for major trade shows such as FOSE—to cover things like labor and catering. Schwartz uses temp services to hire event staff and telemarketers for recruitment.
Although all details are vital to an event’s success, the ultimate detail is the location. And some may be surprised to learn that exotic locations are often not the best choice.
“You really have to consider your audience,” says Howell. “Let’s just say that if we held FOSE in Las Vegas, it would be dead in one year.”
Why? Howell says 90 percent of his attendees live in Washington, D.C., for one. In addition, any government manager traveling on business dollars to Las Vegas would lose his job.
Schwartz adds that places like Hawaii just don’t work anymore. “If you’re servicing busy executives, they don’t have time to spend a week out of the office,” she says. “They have to justify travel, show conference content to powers that be and prove that they’ll be better professionals for attending.”
Many of Schwartz’ events are designed to be close to home for attendees. She does, however, hold an event in Pebble Beach, Calif., each year. In 2005, that show—the CIO Summit—generated $400,000 in revenue.
For Cohen, location depends on the nature of the event. As a consumer magazine publisher, he finds success in unique locales.
“Some of our events are on ships that cater to the LGBT community,” he says. “Our biggest issue right now is to accomplish significant branding for both the advertising trade media and key players in our community within New York City, so we will go there most often.”
When all is said and done, these experienced event organizers say the No. 1 goal is to cater to subscribers’ needs and desires. And it matters. “Events are no joke,” says Schwartz. “I mean, for us we’re talking a $16 million-dollar business, and that’s a lot more than most publications pull in alone.” PE
Sharon R. Cole is a Philadelphia-based freelance writer.