Recession Proofing Your Events
Recession looms: consumer wallets are going to be tightening, and event production costs are going to remain high. What does this mean for event organisers, and what can you do to recession-proof your event?
A recession in the UK has now been predicted by the Bank of England, Goldman Sachs, and EY. The economic news in the UK is moving so fast that we write here will no doubt be out of date soon, but inflation stands at nearly 10%, and disposable income is going to shrink, putting more strain on consumer confidence amid an unprecedented cost of living crisis.
At the same time, event production costs are going to remain high at best or even continue their meteoric post-covid rise as demand continues to outstrip supply.
This might make for chilling reading for event organisers - but it needn't be. We've poured over reams of advice, consulted with veteran organisers, and assembled an awesome set of ticketing features to give you a whole set of ideas as to how you can recession-proof your event.
Read on to find out more...
Understand your customers
Key to navigating economic turbulence is understanding what your customers are experiencing, and using that to inform your communications and marketing. The Harvard Business Review wrote in the last global downturn about the four types of customer groups that emerge in a recession:
Slam on the brakes - the most vulnerable and hardest-hit segment will immediately reduce all types of spending. Both low income consumers and particularly anxious higher-income consumers fall into this group.
Pained but patient - the largest group will economise too, but less aggressively, as they are generally more optimistic about things getting better. They are more resilient in the short term but if news gets worse they migrate to the first group.
Comfortably well off - feel secure and spend at roughly the same levels as before the recession. Includes the most well off but also those who feel assured of their own financial stability - e.g. the comfortably retired, or low-risk investors.
Live for today - carry on as usual and remain unconcerned. Not necessarily the wealthiest, this group is largely young and urban based and respond by postponing/extending purchases rather than cutting them out. Critically for you, they also continue spending on experiences as opposed to consumer items.
Likewise with the groups of customers, the HBR identified four types of purchase:
Essentials are necessary for survival or perceived as central to well-being.
Treats are indulgences whose immediate purchase is considered justifiable.
Postponables are desired items whose purchase can be reasonably put off.
Expendables are perceived as unnecessary or unjustifiable.
Most event ticket purchases will be likely to classed as postponable or expendable purchases, and a treat at best by the most well-off (and smaller) groups of consumers. The key challenge in navigating a recession will be understanding in which of the four groups your core customer base is located, and what you can do for each of the groups to keep them engaged. You can then work to turn what is considered an expendable purchase into a postponable, or a treat.
How to position your event in a recession
Despite the challenges of marketing an event during a recession, there are several strategies that event organisers can use to position their event in a way that will appeal to consumers.
First, focus on value and function. Your event should offer attendees something that they perceive as valuable, whether it's an education experience, networking opportunity, or simply unmissable entertainment that's hard to find elsewhere. It's follows to make sure your event runs smoothly and efficiently - no one wants to waste their time or money on a poorly organised event.
Second, keep up communication with your audience. Regular social media messaging is essential, periodic mailers too (without becoming spam). As discussed, our four groups are nearly all being careful with their spending, so it's important to get across what your event has to offer. Periods of silence will risk losing people's interest.
Third, don't devalue your core product. Even in a recession, people are willing to spend money on things that they perceive as valuable. Emphasise your unique selling points, your value for money and positive customer experiences. Highlight your outstanding reviews and incredible photos/videos from past events. If sales struggle it may be tempting to slash your price but be wary of this - devaluing too hard and too fast might signal your troubles and put people off more as no one wants to attend a lacklustre event. If you need to lower the financial barrier of entry, consider group deals or payment plans.
Finally, focus on national/local customers rather than further afield. During a recession, people are less likely to want to travel or take expensive holidays, and look for local events as a more affordable way to create lasting memories. This is especially true for music festivals - which often require travel and accommodation costs - but can apply to any type of event.
To advertise or not?
With your budget squeezed and prospects looking slow, you may be asking if you should be spending on advertising during a downturn. Our view is that ultimately, you must continue to advertise, in order to bring in customer and survive. The true challenge is to be as efficient as possible with your event marketing budget.
Focus your efforts (particularly paid ones) on event attendees who are most likely to convert into paying customers - these are usually repeat or returning customers, highly engaged leads on social media, or customers local to your event.
Search Engine Optimisation is a strategy that is largely free to implement and pays increasing dividends over time. Once a website is optimised, it will continue to rank highly in SERPs, provided that the site's content remains relevant and engaging. While there may be some upfront costs associated with optimising a website - if you choose to use an SEO specialist or devote your own time to it - these costs can be offset by the increased traffic and conversions generated by the site.
Another low-cost, high-impact event marketing stream is targeted content creation, which can be deployed across multiple channels. During growth periods, social media content can become pedestrian - just showing off pretty pictures as and when you notice the grid has been neglected. Now is the time to plan out a full strategy, with every picture and caption chose to reinforce your narrative and build up to your most important announcements. Pay close attention to the best platform for your brand.
Lead generation and nurturing are still worth doing during a recession. As discussed purchase decisions might be delayed but are not lost easily. Although pay-per-click is likely to be less effective in a downturn due to reduced prospects, if you are able to make a quality initial pitch, there is no reason someone won't sign up to your mailing list to hear more. It is then a job of building trust consistently over time, through quality newsletters that do not focus just on selling.
Controlling other costs
With potentially wobbly income, controlling your costs will be key to thriving in a downturn. Rigorous budgeting is the key. Don't take a hack and slash approach, cutting wherever you can but instead deploy a scalpel. Do meticulous research to back up any decision you make and don't cut the core essentials of your event - lest you risk disappointing customers and making it harder for you next time around.
One way to save money is to reduce complexity and look for efficiencies. For example, if you are using two different suppliers for products that could be provided by one, it may be more cost-effective to switch to a single supplier. Similarly, if you can purchase items in bulk from a wholesaler, this may also help to reduce your costs.
Another cost control measure is to negotiate extensively with suppliers for the best possible deals. This can be a time-consuming process, but it is worth the effort in order to get the most competitive prices. Always get multiple quotes for each item you need a supplier for, and don't be afraid to haggle. The more efficient you are in negotiating with suppliers, the more money you will save over time.
Maintaining a healthy income will take some of the pressure off, so it is worth considering alternative revenue streams. For instance merchandising is an easy upsell for established brands, which you can increase uptake on by including in the ticket booking process. If you can think of a worthwhile opportunity for a sponsor, securing a partnership here can lead to some great cash injections.
Finally, during the pandemic some governments and local authorities had help to hand for event organisers during those tough times. Whilst nothing has been announced (or should be expected) for the ongoing turbulence, it is worth maintaining an open line with the relevant authorities for your event/company such as the local council, the NTIA, or the DCMS should any funding/help become available.
Make it easy for ticket buyers
So (hopefully) after getting your budget in order, and taking time to understand your customers, you've positioned your event in a way that makes it as easy a decision as possible for your customers to book. Now you need to make it as easy as possible for them to actually book the thing.
Ensure your pricing structure is sensible. Make sure your Presale/Earlybird tickets are sufficiently reduced versus later tiers to give a strong incentive for booking earlier. Reward engaged / repeat customers and make the most out of your mailing lists by offering Presale to them first. Any VIP offering at a higher price must have clear and tangible benefits.
Incentivise larger bookings by using a Group Deals scheme such as "Buy 5, get 1 free". Or lower the financial barrier of entry to your event and let customers spread the cost of a ticket over several months using a Payment Plan.
The booking process itself should be as short and as easy as possible. Make sure you aren't asking superfluous questions for data gathering (e.g. date of birth) and keep your marketing opt-in simple (and GDPR compliant). A good way to keep the steps necessary to book to a ticket to a minimum is by using a highly optimised ticketing platform that supports Apple Pay and loads all stages in one page. We can think of at least one.