Measuring the Warm and Fuzzy: The Impossible Return on (Event) Investment

Tangible methods of measuring event effectiveness.

Frustrated Managing and Marketing Directors continue to scratch their heads as they are perpetually presented with bland ROI (Return on Investment) reports commenting on the effectiveness of their latest promo/ activation/ event.

Using simple economics, any self-respecting financial director will see the massive amount of cash that is being sunk into Marketing budgets and experiential eventing and ask the question “Was it worth it?”

From annual sales conferences and team building to product launches and award citations – the big brass have to have tangible proof that the money was well spent and that it was a sound investment.

The Direct Conflict of Interest

Marketing and HR departments are constantly being asked to provide results on the success of their events. It is human nature to ensure that the results of their hard work totally justify their efforts. I am not calling in to question their voracity, but it is a clear conflict of interest.

If your boss asked you to grade your performance and told you that you would lose your job if you graded badly – would you be totally honest?

Some clients take the higher ground and ask their events agency to incorporate an ROI tool into the event with participatory feedback from the attendees.

Again – surely the events agency has a vested interest to ensure that the results of their event – the creative they sold and delivered – is portrayed in the best possible light?

 

So how do you measure the warm and fuzzy?

Measurement of event effectiveness should be very simple:

Output before intervention     vs.     Output after intervention = Return on Investment (ROI)

A quick Google search will offer a myriad of ROI tools and theories, the majority of which sound like a wet rag.

These include:

  • Responses from the attendees
  • Client leads
  • Increase in brand position
  • Improvement in customer perception
  • Press/ Media Coverage
  • Survey results
  • Quality/ Fit of attendees
  • Response from management
  • Sales Growth
  • Client retention
  • Total attendance
  • Revenue generated from a paying event

 

While there are seeds of a strategy in these points – they are not rich solutions with real data that measures effectiveness.

Often the ROI strategy is developed AFTER the creative which is clearly the wrong way around. Any event or intervention is STRATEGIC – and a creative presentation should clearly identify the pathway from execution to desired results. In most event proposals – this is a glaring omission – leading to the fact that event companies are not taken seriously in most parts of the world. They are the “Rock and Rollers” and not directly linked to a successful outcome.

Before you DO anything – you need to decide on the outcome. Make a statement.

Here are some ideas:

Launch: “I want to sell 30 000 units in the next quarter”

Conference: “I want 70% retention of the five key messages after 12 months and a 5% increase in sales over the same period.”

Experiential Event: “I want 90% attendance of the TARGET market, 80% Conversion opportunities and 40% actual conversion.”

Team building: “I want 98% attendance and a 10% reduction in staff turn-over”.

These statements need to be Realistic, Tangible and Measurable.

Okay – so now you know what you WANT to do – the next question is HOW to achieve it.

Getting the Right People in the Room

In the case of a launch – getting the RIGHT people in the room is the first most critical point. Often launch venues are filled with staff, management, media, VIPs, collaborators and a posse of hangers-on. Rarely do the numbers of ACTUAL potential customers (who are poised to make the purchase decision there and then) outweigh those who are not. When you are counting the cost per head – this becomes a very expensive exercise.

The best investment a launch team can make is to fill their venue with individuals who are on the brink of making a purchase decision, open to options and willing to try new things. The strange thing is that in the new world information economy – these individuals probably have more information on the product than you will share with them (the internet is a great thing). They are there to be entertained, excited and to get hands-on experience.

There is no greater waste of resources selling to those who are clearly not interested – but are there for the free punch.

Go through the guest list and ask simply: “Will they buy or buy in?”

Perception versus Engagement

There is one thing liking an event and actually actively engaging. Event organisers (and marketers) often fall into the trap of measuring the success of an event by “satisfaction” and not by action. Any engagement requires a result – and one that can be measured.

“Just because I went to the event, doesn’t mean I engaged”.

“Just because I liked the launch, doesn’t mean I’ll buy the product”.

“Just because I remember what was said six months ago, doesn’t mean I did anything about it”.

“Just because your brand is the #1 recognised brand, doesn’t mean I’ll engage and use it”.

The engagement needs to compel the audience to take action. Without this – all the effort is pointless and expensive.

As an aside, I’ve been in many presentations where the PR team seem convinced that their event will make global headline news. The launch of a building or a new flavour of gum may be massive news to you – but the media often just are NOT interested. The relationship between marketing and Public Relations often becomes blurred in the event space with the respective teams battling for footprint.

Clearly establish the territory and ask for a considered external opinion as to how newsworthy your event is and plan around it.

Re-thinking Return on Investment

It seems that the term of “Return on Investment” has been largely misused. The return on investment should not initially be about the “Bang for your Buck” mentality. The “Return on Investment” should focus on giving the attendees ROI first. What do they get for the time they are investing? How is this proposition worth their while? Why is your presented solution in their best interests? How will their whites be whiter, colours brighter if they spend their hard-earned cash and use your product?

You need to show a direct link between your proposition and a better solution for them.

Whether you are selling soap, an idea, a proposition or a concept – the true value is in mapping the real return in investment for your audience. “How will this make things better for me?”

Magically – if you satisfy the Return on Investment for the audience, they will reciprocate by making your investment see a phenomenal return.

Finally, the buck must stop with the measurement of ROI – not by those involved in the event – but by individuals with nothing to lose. They need to report to the top directly and give honest, considered opinion and fact on the value that has been created and spent.

Ultimately – true positive Return on Investment leaves a company and attendee in a better position than they were before the show began and the fuzzy stuff started.

 

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