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Event management


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Event management

  2. 2. A SYNOPSIS OF THE PROJECT EVENT MANAGEMENT This project has been prepared for the completion of the Subject – Project Work as is required under Fifth Semester of Bachelor of Management Studies. This project explores the various aspects of event management. This project can be broadly divided into seven sections. The first section of the project we take look at what is event management, its benefits and the key elements of events with the help of an example. We also touch upon how this is growing industry looking at what it was 15 years ago and what is the current position of this industry. Then we see broad classification of events, which is in to two categories namely live entertainments events and corporate events. Corporate events account for the lion’s share of the total number of events managed in the country. The second section of the project deals with the industry scenario. This section covers details of event management showing that now weddings and birthday parties are celebrated in such a large scale that professionals need manage them. This is followed by the overall size and shape of the industry further followed by segmentation of events breaking it into smaller categories. The third section of the project deals with the actual process of event management. We first look at the over all planning structure which is comprised of analyzing the event. This is followed by assembling the event management team, then selecting the event coordinator. After which decision makers, technical staff and support staff are appointed. An efficient record keeping system is to be implemented. 2
  3. 3. The fourth section of the planning phase is the budget, which is a very important detail. It is only through the budget does the manager know what all are the options in all the fields that can be employed for the event. Then an efficient program design needs to be designed. The fifth section deals with selecting the speakers required for the event. Selecting speakers is a difficult task for the event coordinator. After which the site selection process begins. The next step is to decide the food and beverages for the event. Another important part of the planning phase is the security aspect of the event. The sixth section deals with the data collection interpretation of the data and reporting and presenting the data in a manner, which is useful to all in the organization. Then we deal with the marketing and promotion of the event. The marketing considerations need to be given attention to. Finally we decide the theme of the event and also which type of event does the event the firm is planning falls into the different types of events. Then we discuss about sponsorships and then the project deals with the event control sheet with a hypothetical example. The final section of the project deals with the key trends in the industry, the key challenges, the case study – Bacardi, the future prospects, the conclusion, which has been in reference to what is mentioned in the project, and then remarks about event management and the project ends with a bibliography and a questionnaire as tools of data collection of the matter presented in the project. 3
  4. 4. INTRODUCTION Definition of Event Management “Event management is the planning and management of an event, project or activity.” Event Management 15yrs ago, this phrase would have meant nothing in the India corporate world. Today, it conjures up the image of celebrities packaged with glamour and pomp in a gala event that is meticulously planned and slickly turned out. Event management in India, which was born somewhere in mid 1980s, has grown in to a highly professional and tech-savvy industry over the years. In 2001, the industry managed over 1,000 events, including 22 international events. Broadly event can be classified as corporate events and live entertainment event. Corporate events are commissioned by corporate for specific purposes such as dealers’ conference, or a happening such as the India visit of Indira Nooyi, worldwide chief of PepsiCo. Corporate events account for the lion’s share of the total number of events managed in the country. Live entertainment events are stage shows or concerts by international artists (international events) or Indian artists. These could be film based, music- based or sports- based events. For instance, The Manikchand Filmfare Awards is a film-based event, a concert by ghazal maestro Pankaj Udhas or by the international rock group Scorpions would be a music – based event. Typically, for a live entertainment event, there is more than one sponsor as well as entry fee for the audience. This category of events, albeit small, is growing rapidly in size and popularity. 4
  5. 5. Unlike a corporate event, a live entertainment event is usually conceptualized, planned and executed by the event manager. Therefore, the Intellectual Property Rights (IPR) also vests with the event manager. However, a company/television broadcaster etc can also commission an event. In such circumstances, the company/television broadcaster sponsors the entire show and retains the IPR. The event manager is paid a management fee and a production fee as well if it also produces the event for television. Certain events are created and marketed by the event manager as a branded property. These events are called branded events. They are held periodically and require substantial investment in terms of infrastructure and marketing. For instance, the Femina Miss India contest is branded event produced by Times Entertainment and held annually. "An event is something that happens, not just exists - somebody has to make it happen. Successful events only come about through action, some individual or group of individuals getting things done." 5
  6. 6. A Comprehensive New Definition An event is a live multimedia package carried out with preconceived concept, customized or modified to achieve the clients objectives of reaching out and suitable influencing the sharply defined, specially gathered target audience by providing a complete sensual experience and an avenue for two-way interaction. From the above figure we can infer that an event is a package so organized so as to provide, reach and live interaction between the target audience and the client to achieve the desired impact. The population of the target audience that the event is exposed to is called the reach of the event. The live interaction process facilitates communication between the clients and the audience. 6 Events Reach Live interactio Right communication with the client With Live Audience Creates Desire d Impac t
  7. 7. BENEFITS OF EVENTS 1) Brand awareness- Helps in increasing awareness of a company or its brand(s) 2) Corporate Image- To support, build or change a desired company or brand image. Shape or reinforce the public’s perception of a company’s brand attributes. 3) Media Coverage- Guaranteed and potential publicity, helps in projecting right corporate imaging of the company 4) Building corporate hospitality- Entertain key and potential clients, b2b marketing, building goodwill amongst potential clients, reinforcing faith in distribution partners, forging alliances with potential investors, motivating existing workforce or rewarding them. 5) Niche audience targeting- More cost effective and accurate than conventional advertising which can get diluted. 6) Product showcase- Opportunity to showcase existing products and test new products. 7) Differentiation- helps create perception about product, helps differentiate product from competitors. 8) Identification with particular lifestyle- Creates brand world experience which audience can identify with hence forming an emotional bond with the target audience by supporting their lifestyles and likes 9) Merchandise opportunities- Opportunity for on the spot audience gratification 10) Impact the bottom line- Driving sales through contests, special schemes 7
  8. 8. KEY ELEMENTS OF EVENTS A CASE EXAMPLE Event: L’Oreal femina elite model look ‘98 Event Infrastructure: • Core concept: Search for a new top class modeling talent through a contest and pageant interspersed with entertainment. • Core people: Participants i.e. models taking part in the competition and other performers during entertainment slots such as well known classical musicians Pt Shiv Kumar Sharma, Rahul Kumar Sharma accompanied by Ustad Shafat Ali Khan and popular music by Shweta Shetty and Stereo Nation. • Core Talent: Physical Looks and Proportion • Core Structure: Annual event of Beauty pageant Event organizers: Femina with • Fountain ahead: Event support 8 Event Organizer Venue Event Infrastructure Target Audience ClientMedia
  9. 9. • Banyan Tree: arrangements for classical music performance • Hemant Trivedi with assistance from Noyonika Chatterjee: Choreography and direction • Omung Kumar Bhandula for Opus construction: Sets Venue • Shoot location: the retreat, marve • Official Host: Taj Mahal Hotel Media • Pre-event: magazines and newspapers to inform about event and call for enteries with entry forms in them. • Electronic Media: TV and FM radio to inform target audience about event coverage, date and time. • During event: live coverage on DD2 for widest coverage • Post-event: Re-telecast on Star Plus. • Interviews and appearances of winner on shows sponsored by L’Oreal on the electronic media. Reports on the events in the print media. Clients • Main Sponsor: L’Oreal • Gift Sponsors: Onida, Siemens, Baush and Lomb, Global Telesystems, Akbarallys, Department store, Trussadi, Catwalk Shoes, Estelle, The Orchids, Lakme, Sony Music • Communication Convience: Gloal Telesystems. • Beverages: Coca-Cola Target Audience Youth or family though with a younger mindset or young at heart 9
  10. 10. THE INDUSTRY SCENARIO Event Management is a multi-crore industry with mega shows and events hosted regularly. In India even personal functions like marriages and birthday parties have become important social matters, and have to be professionally managed. The growth of sophisticated and mega companies have brought forth a spurt of meetings, seminars, exhibitions, conferences, product launches with everything being a matter of class and style. Then comes the innumerable celebrity shows, international artists shows, shows for a cause, road shows, competitions, that India has seen of late. More than 200 companies have forayed into events. The early 90s has seen events spend at a mere 20 crores but now it has increased to over 500 crores. Growth is therefore 400% annually. The FICCI has estimated event management to be a 3500 crore industry by 2005. But surprisingly, research showed that there was no formalized education to teach event management and Companies found their executives not up to the mark to handle events. It was not so easy to train because event management includes organizational skills, technical knowledge, P.R., marketing, advertising, catering, logistics, decor, glamour identity, human relations, study of law and licenses, risk managements, budgeting, study of allied like television and other media and several other areas. 10
  11. 11. OVERALL SIZE AND SHAPE The size of the live entertainment segment can be measured in terms of total billing for the events managed i.e. sponsorship fees, tickets sales revenue and sales of various rights associated with the event content such as telecast rights, music and video rights, internet rights and merchandise rights. Sponsorship fees: On an average, there are three sponsors for an event – one main sponsor and the two co-sponsors. The total sponsorship fees ranges between Rs. 10mn and Rs 20mn for an international event, and between Rs. 2.5mn and Rs. 5mn for a domestic event. Ticket sales revenue: This revenue source has picked up substantially over the last year. Currently, approximately 25,000 tickets are sold on an average in an international event. Ticket sales revenue has ranged between Rs 3.2mn for the Venga Boys event to Rs 24mn for the recently held show of Bryan Adams. Sale of telecast rights to television broadcasters: event managers have not commercially exploited this source of revenue so far. There have been only some stray deals involving sale of telecast rights, for instance DNA networks has sold about 3 properties to B4U for approximately Rs 4.5mn. Sale of Internet rights: As broadband Internet is not currently available for live video streaming of an event, this is non-existent. Sale of merchandise rights: In case of concerts by popular artist or groups or popular sporting events, significant revenue can be earned through the sale of event-related merchandise such as clothing, etc. The event manager can sell rights to merchandisers for such activities. However this is not a significant source of revenue at present. 11
  12. 12. In 2001, the industry managed approximately 1,000 live entertainment events, including 22 international events. According to industry sources, the total billings for the year are estimated at Rs. 1.5bn, with domestic events accounting for Rs. 0.9bn and international event and a domestic event is as under: Revenue profile for international and domestic events (average) Item International event Domestic event Sponsorship fees 30% 80% Ticket sales revenue 70% 20% (Source: Industry) 0 20 40 60 80 International Event Domestic Event Revenue Profile for International and Domestic Events (average) Sponsorship Fees Ticket Sales Revenue In terms of cost, artists’ remuneration accounts for 40% of the costs and production expenses such as erection costs of the stage, lights and sound, and operating expenses such as travel and stay expenses of the troupe, freights expenses, etc. account for the balance. This cost profile is the same for domestic event as well as an international event. 12
  13. 13. Cost profile for international and domestic events (average) International event Domestic event Artists’ remuneration 40% 60% Prodn and operation cost 60% 40% Cost Profile for an International Event Artists' Remuneration Prod n & Operation Cost Cost Profile for an Domestic Event Prod n & Operation Cost Artists' Remuneration 13
  14. 14. CURRENT SCENARIO “Today, Event Management has emerged as one of the fastest growing industries in India, and a career in event management is not only lucrative but also glamorous and challenging. Events are now acknowledged as a tremendous image multiplier option leading to greater development. As a result, opening brighter and prospective career opportunities for the new age career seekers.” India has just hosted the first Afro Asian Games. Soon, it is going to host the Commonwealth Games in the year 2010, an event many times the magnitude of the Afro Asian Games, and India is also making a bid to host the 2016 Olympic Games in India. What does this mean to the Event Industry? It means jobs. It means shortage of people with the skills required to execute an event of the enormity. The organized industry has grown from around Rs 350 crores during 2002 to be a 580 crore (US$129 mn) industry in 2003. the live entertainment and event management segment has demonstrated an overall growth over : 60%. As this segment, which is still in its infancy, becomes an increasingly important part of the media pie, it is expected to demonstrate a growth of 30% pa over the next five years, in effect, more than doubling its size to approximately Rs 1443 crore (US$321 mn) by 2008. And that’s just the part, which can be measured and estimated. There are around 10- 15 large players with revenues around or over Rs 20 crores each and many small players- around 70% of the segment remains unorganized. The event segment as a whole can be divided into several key sub segments that include corporate events, sports, arts and theatre, felicitations and contests, festivals and personal events, of these, small operators I the unorganized sector primarily manage weddings, small corporate events, and festivals which have not been considered for the purpose of the size and the Indus 14
  15. 15. SEGMENTATION Segment wise analysis of organised & unorganised business of live entertainment 35% 5%20% 20% 5% 15% Corporate Sports Arts & Theatre Felicitation & Contests Festivals Personal (Source: Industry estimates, Ernst & Young Research) 15
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  17. 17. OVERALL PLANNING STRUCTURE Analyzing the event The planning process begins with an analysis of the event itself. The questions that begin this process what is the main reason behind having this event? What does the event hope to accomplish? How will the event be financed? Numerous questions are placed in front of the event manager. That is how a strong foundation is established. If too few questions are asked, an event can suffer from a lack of focus and direction. Keep in mind that during the planning stage there are many options and hurdles to anticipate. Some things increase complexity tenfold and others simplify by an equal amount. A party in the hotel, for example is always simpler to arrange than a party in a warehouse of distant field with no power, no restrooms, and no kitchen. That is not to say that the event manager shouldn’t have an off-site party, but the details should be considered in the planning stage. In the same vein, the site is often selected before the program has been set and the event manager may have to anticipate a problem fitting the program into the available space. Assembling The Event Management Team The next important stage of the planning process is assembling the team. Broadly speaking, the team should consist of decision makers and implementers. Decision makers are the people who define the parameters and are ultimately responsible for the success or failure of the event. Implementers are those who do everything from negotiating contracts to inviting speakers to making sure that the right speaker is in the right room and that the microphone works. 17
  18. 18. More specially, the planning team will probably include people or committees with the following functions and responsibilities: Event coordinator The planner is the central coordinator and does the following: negotiations and recommends contracts for signature; solicits bids from suppliers and hires and supervises suppliers; prepares and recommends budgets and monitors expenses throughout the planning process; recommends policies and procedures, supervises registration, maintains communications; set up filling systems for controlling documents and reports; prepares personnel schedules for on site activities. Decision makers Decision makers may include the organization’s president, CEO, executive director, chairman of the board, corporate officer, and certain departmental heads. Technical staff Various tasks requiring technical expertise may be assigned to in house personnel or to subcontractors. Support personnel Members of the clerical support staff handle typing and computer date entry, makes copies maintains files, process incoming and outgoing nail, and stuff attendee packets; they may keep daily activity logs for registration, expenses, and income, they direct incoming calls; they follow up on requests for brochures and answer routine questions such as dates and costs. 18
  19. 19. Developing record keeping systems Often, the event planner becomes the central coordinator of all information. Therefore record keeping systems are essential to organize, control, and monitor activities. The organizational system he sets up must include a planning schedule. Deadlines forms and checklists to expedite the process and capture the details in a structured, usable quickly retrievable manner. The system’s documents become the files and records he will need for reporting, evaluating and planning for future events. Establishing policies and procedures Another important planning issue has to do with establishing policies and procedures in the early stage. The key to effective management is deciding the rules up front and advising the people they affect. Simple things such as registration cutoff dates, administrative penalties for cancellation, payment and reimbursement procedures for speakers, to name a few need to be established and communicated or event coordinators will find themselves continually answering the same question and mediating disputes. Preparing a planning schedule A successful event coordinator must have many attributes, but two important characteristics are good organizational skills and attention to detail. A key tool that will help in this regard is the planning schedule. The planning schedule is a detailed list of all the required tasks and steps, the required completion dated, and the person, department, or committee responsible for each. The event coordinator should prepare it. 19
  20. 20. THE BUDGET The event manager cannot have a successful planning structure without a budget and priorities for how the money will be spent. Financial decisions affect every area of the event and must be established early in the process and monitored on a regular basis. The importance of having all the planning issues covered is that, by anticipating problems, special needs, and hidden costs, the manger can be calm during the storm of the event. If he/she always ask “what is the worst that can happen?” and then have a solution ready, they will have a reservoir of strategies to be used at a moments notice, no matter how serious the crisis. 20
  21. 21. PROGRAM DESIGN What is the program? It encompasses all of the activities planned for the attendees, from the moment they arrive until they depart. It includes the content, recreation, meal functions, receptions and parties, tours, expositions, spouse and children’s’ programs, and informal and unscheduled free time. What are the program topics, passive and active sessions, serious and fun presentations, and formal and informal times to provide professional and personal growth and networking opportunities for participants? The program is like a jigsaw puzzle. When the event manager starts the puzzle, all the pieces are there but what a mess! The design is putting the pieces in order. This is more difficult than it sounds because of the many needs and expectations coming from bosses, association or committee members, attendees, speakers, and suppliers. Purpose of the event The first step is to prepare a statement on the purpose of the event. Identify whether the mangers objective is to educate, to inform, to solve problems, to reward, to introduce new products or services, to generate revenue, or whatever. The Audience Next, he needs to know something about the attendees. Will the audience be primarily male, female, or mixed? Are spouses and children invited? Has the primary attendees met together? Will they know each other? What is their knowledge or skill level in relation to the subject of the program? What is the groups’ personality? Is it fun, serious, verbal, formal? This may not seem like a major issue, but it can make a huge difference in the success of the program. There is a big difference between state legislators and hand surgeons. That brings us to why the attendees will sign up in the first place. Their needs and expectations should not be overlooked. The sponsoring group is often so concerned 21
  22. 22. about the organizations’ need being met that it forgets about the attendees. The event coordinator should play a strong role in monitoring the program plans to see that the attendees are not forgotten. Selecting topics formats and speakers or participants Preparing a master list of topics or activities that is required by the event coordinators particular event and list educational topics important to his group. Once the list of topics is complete, the manager can begin the task of assigning a format to each topic. Some may be debates; others may be group discussions, still others, lectures papers. Finally there is the challenging task of finding the right person to successfully implement the selected format Time allotment In addition determining what time of year the event will be held and how many days it will run, time allotment means establishing time allowances for each topic and presenter. To do this, the manager must rough out a program agenda showing the activity, the format, the amount of time allotted, the sequence (daily), and the topic Budget Prepare a budget listing all programs costs, including meeting-room rental, attendees’ materials speakers, fees and expenses. 22
  23. 23. SPEAKERS AND OTHER PROGRAM PARTICIPANTS Who are the people on the program? A program requires a variety of types of people-speakers, moderators, interviewers, workshop leaders, trainers, discussion leaders, panelist, expert witness, and summarizers. If we must have a generic term, let’s use “program participants.” But don’t confuse that term with attendees, who are also often called participants. By using the word “speakers”, we lead people to believe that they need only come prepared to speak, when should be leading training, interviewing. Scrapping the term “speakers” is a fairly easy way to make a dramatic difference in the quality of programs offered. The challenge is to see how many different types of people the manager can use to communicate the required information without having them read speeches. Successful professional speakers learn very quickly that reading speech is not good for business. They talk to their audience; they usually move off the stage, walk around, and look the audience squarely in the eyes. Wireless microphones encourage movement. Theses speakers are often looked upon as entertainers, and there is nothing wrong with speakers being entertainers. In fact, the problem arises when a speaker is not entertaining. Event coordinators must be more selective more demanding and more detailed with speakers. They have got to learn how to bring out the best in poor speakers who happen to be recognized expert in the field. Most speakers would not welcome guidance on the subjects’ desired focus as well as the type of attendees and the level of their knowledge is unimaginable. As the competition to attract attendees grows attendees are becoming more selective about where they send their budgeted event money. Programs with high-quality, 23
  24. 24. knowledgeable speakers, a variety of type of program participants, and focused and varied presentations will capture the market. Just as the design of program is one of the most creative aspects of planning an event, the management of program participants is one of the most challenging. The managers’ programs participants are the transmitters of all that he hopes to communicate. Both the coordinator and the presenters need to reevaluate the importance of the participants’ role. 24
  25. 25. LOCATING PEOPLE Thinking about program participants actually begins in the program design phase, because this is where the manager decides what he wants plan to communicate and how he will do it. As the manger selects the topic and a format, He must ask if he can locate or recruit qualified people at a price he can afford. Once the event manager knows the boundaries of who he needs and what he has to offer, he can begin researching, brainstorming, asking knowledgeable people in the field or his colleagues with related and respected experience. Don’t automatically use the staff, board of directors, congressperson, and friends as key presenters. Not only may they not be the best, it may be harder to keep them focused on the goals and the audiences interest in the subject. Besides, how does a manager tell his congressperson or the chairman of the board that the fifteen minutes are up? Clarifying roles While the manager is researching his resources, he should begin to define in writing what he wants each person to do. What role does this person play in the conference? What does that role mean to him? Will the participant automatically understand what he expects? Probably not, so the manager should write a description a short paragraph explaining exactly what is expected of each program participant. Developing content guidelines The next step is to develop a written list of points or questions the manager would like to have included in the speech, discussion or workshop. Then communicate these points to his program participants in writing, through briefing meetings, or in reviews of their plans. This is also a good time to go over the schedule and the importance of adhering to it on site a key aspect of managing program participants. 25
  26. 26. Some topics are so broad it would be pure luck if the speaker/leader touched on them without guidance. The question the manger may ask is: why tell the experts? The answer is that the experts usually have no way of knowing what has been covered in past events, and they may not know the level of audience’s knowledge or its current interest in the subject. All speakers have favorite aspects of a subject, areas in which they are most comfortable and require the least preparation. Without guidance, speakers head straight in that direction and the manager will have given them a license to do what they want rather than what he or the audience wants. They aren’t wrong the manager is for abdicating his responsibility. The event coordinators who think through theses program issues to the same extent they think through the logistics will succeed. It is not hard: it’s logical. What would the event manager want to know if he were asked to speak to or lead a group? Ask speakers whom he respects what would be helpful to them. Call potential attendees and ask them what their interest in a particular subject is. Research takes time and requires the manager to become a three minute expert in a variety of subject areas. It offers the opportunity to learn about so many different subjects. If the manager has to delegate don’t give the job away without explaining what he wants, indicating why he wants it and supervising the product to keep it on target. 26
  27. 27. SITE SELECTION The Hotel Market The beginning point is to know the hotel market and the event group. The manger must first understand that hotels make a profit from guestroom sales, not from sales of food and beverages. Once he realizes that, a series of questions must be explored. He needs to know the high, low, and average rates for each property. He should know occupancy levels at various times of the year and a week. He should know the general economic situation in the city and within the hotel. Companies such as PKF consulting produce monthly and annual reports on an areas occupancy level and average daily rates (ADR). These vary by seasons and days of the week Look internally for stable ratios of staff to guests and at staff turnover. How long has the firm’s salesperson been there, the general manager? Request a copy of the staffing roaster and ask for lengths of employment. Along the same lines, look at the hotels ownership structure. A hotel is part of a chain may be owned and operated by the chain, or may be franchised, and thus carry the chains name but be owned by a separate entity. In either situation, a management company, whose reputation the manager should check, may perform management of the hotel. Each of the foregoing arrangements is not of itself good or bad; the manager simply needs to be aware of these structures. For example, there are hotels operated by management companies whose standers are higher than the corporate franchise name implies and vice versa. This is just the tip of the iceberg for the firm’s market research. 27
  28. 28. THE PROSPECTUS Next to use a tired but true phase, is to know the event group. Roughly, “the event group” includes the company or organization the event manager is working for, the programs goal and requirements the budget and the attendees’ needs or preferences. The formal document that profiles the event group is called a “prospectus”. The first section should introduce the organization and the specific event in general way. While the introduction should be factual, it may also be considered a promotional description emphasizing the organizations purpose. Section II should relate to the events site requirements for this specific event, to include the number and type of guest rooms, ADA requirements, preferred rates, dates and pattern, and the manager’s moment by moment needs for meeting rooms. This breakdown should include room setup, anticipated attendance per room, and any special space eaters, such as projection equipment, screens, or head tales. In such cases he many indicate his total square footage requirements as a total number, or per person if higher than normal allowances are required. This is also the time to specify ceiling heights, freight access, or any other required features. Be sure to advise the hotel if commissions are to be paid to the firm or not to any third parties, other that the direct booking event. A simple statement that says rates are either commissionable or no commissionable will do. A facility should be able to determine from this section whether it can accommodate the event group. If the manager has ever repeated the same requirements over the phone to fifteen different properties, he will quickly realize the benefit of including site requirements in his written prospectus. Not only will he ensure that everyone receives the same information as part of a well thought out plan, he will ultimately save time and gain well deserved respect for a professional approach. In section III, describe the firms’ history, either regarding this specific event or a similar one. This is the place to demonstrate that the firm’s assessment of its group’s 28
  29. 29. needs is accurate and that the facility must deliver what the manager is asking for. Include past cities, properties, and numbers broken down in every possible way. Especially as related to numbers, the firms’ history plays an important role. The manager can be sure the hotel will check the firms’ past history. Prospective hoteliers will want to find out about the firms’ guest/sleeping room mates and pick up, the events meals counts, firms’ total master account charges and credit record and all too often they’ll elicit a few choice editorial comments from the prior facilities managers, which may be to his benefit or disadvantage. The inexperienced coordinator probably has no knowledge of this underground grapevine. The experienced coordinator not only knows it exists but controls the information released. How? By preparing in the contract that any report or data about the event must be approve prior to release by the hotel, thereby giving the coordinator an opportunity to adjust any incorrect or misleading information. The most difficult problems for hotels are when the firm considers that their sales are generated from guestrooms. Say for example 300 rooms are requested and no basis for arriving at that number is given. Hotels either need a history or a rationale for the requested number of rooms. If the manager wants it all with no guarantees and no history, he can and should expect to pay heavy penalties if he fails to meet his confirmed requirements. Attrition clauses have been added to hotel contracts to hold the coordinator responsible for lost revenue from unsold rooms. Section IV is a detailed day by day time and event specification. The hours, event and location should be itemized for each day of the event Once the event’s prospectus is complete, the manager should review potential hotels, select those that meet his criteria, and send them a copy, he might even close an R.S.V.P card and ask the hotel to return it indicating its intent to submit a bid. A three to four week response deadline should be established. 29
  30. 30. SITE INSPECTIONS After careful review of the proposals, the manager is ready for his site inspections. The tendency for most coordinators is to over schedule their site inspections appointments and to respond to the invitations of all hotels that want to see them rather than only those appropriate to their event. Three to four hours per facility is the minimum time needed for a thorough inspection. The “interview” portion should take one to two hours and the walk through, depending on the facility size, one to two hours. Then he should give himself one hour alone for note making measuring, and revisiting the areas he’s having trouble remembering. It’s best to do this on site, so the coordinator can go back to the room or ask the salesperson to fill in the gaps. There are numerous site selection checklists that are useful in devising the manager’s form. He doesn’t even have to have a form, but a system for capturing comparable data is going to be valuable when he makes his final decision. Reference checks Finally, the manager should check references of the final properties under consideration. Ask for the names of three companies that held events similar to the group’s event in the hotel in the past month. That ensures a response based on the current level of service and limits the ability of the hotel to give the event group their best references. Everyone has had “star” performances they want to find out about the typical ones. Even a bad reference can be good if it helps the manager to anticipate problems and prepare solutions in advance. At one time or another, everyone has been in this position, but that is no reason to be less through. If this is the case for the event coordinator, he should think in terms of site evaluation rather than site selection. Regardless of the number of choices, he must know the capabilities and limitations of the facility and the staff the building the people. The event manger should not forget about the hotels general manager (GM). The manager can ask the bell or housekeeping staff who is the GM? and see what 30
  31. 31. comments are volunteered. There are various approaches to finding out more about the facility. Some coordinators visit the hotel unannounced, other take a secret tour of the services areas, and some have private conversations with guest and in house groups. The key is not so much how the manger approaches site selection, but that he is thoughtful and thorough. Negotiation Negotiation is the thread that should have been woven throughout the entire process. Actually, negotiation is an important sounding word for the give and take discussion between the hotel salesperson and the coordinator. The key to success in this area is not only to know what the manager wants in relation to what he must have, but to know the other business as well as or better than the other sides representative. Unfortunately, the reverse is usually true: the hoteliers know more about coordinators than coordinators know about themselves or their event. 31
  32. 32. FOOD AND BEVERAGES Food and beverages usually constitute a high cost item for the coordinator, and a hotel’s prices should be evaluated as a part of the site selection process. Hotels are usually less flexible in their food process than their room rates, especially if the manager waits until after the contract is signed to negotiate food and beverage. Hotels are often reluctant to guarantee process more than three months prior to the event because of the fluctuations in the costs of food items. This is not generally acceptable to coordinators because they need to prepare a budget one to three years ahead of time. One option is to have current menus signed and dated and insert a contractual clause that limits price increases by tying them to cost-of-living increase or to some other predetermined percentage. Even with this option, prices should be finally confirmed one year out. The manager should not select a site on the basis of process alone. If cost seems to be the coordinators only criterion, the hotel may try to lower its price by reducing the number of services, the quality or freshness of the food products (lesser cuts of beet canned versus fresh vegetables), and possibly the size of the portion. A loss of service and quality can eventually be more damaging than a few added Rupees. The hotel market The hotel market is constantly changing depending on supply, demand the inflation rate, and the availability of money. It is therefore important for the coordinator to stay informed on market conditions. Convention hotels traditionally have high, shoulder, and low seasons that also influence rates over that period. When selecting a hotel it is important for an event coordinator to be up-to-date on the market situation. The best and most current sources of information are the industry trade magazines including those of the hotel industry. If the coordinator does not receive these magazines he should ask local hotel industry friends if he may borrow a copy or the event manager may simply interview them. 32
  33. 33. When the hotel industry is in a down cycle (a sellers market of the hotels) the coordinator has the advantage; in an upward cycle (a sellers market for the hotels) the coordinator is at a disadvantage. It is quite simple, as demand moves closer to, or exceeds, supply costs increase and the hotel can be more selective in the business they book. They establish the rules and effectively eliminate those who are a not reliable customers. This is not to say that there are not times when they will want the event group’s business, which is a logical question for the manager to explore with his sales person. 33
  34. 34. PLANNING A EVENT WITH SAFETY AND SECURITY IN MIND Safety and security are on the minds of all travelers. While the percentage of crimes against travelers nationwide is lower than against residents in a community that is small consolation to an event coordinator when he’s assisting an injured or victimized event delegate. What makes the safety and security situation even more challenging is that too often people are not as cautious when they travel as they are in their own homes. Therefore, the coordinator should be familiar with the basics to provide a safe and secure environment for his attendees. Addressing these details as part of the planning process can help boost attendance and reduce liability exposure both for the event group and the organizational sponsor. Safety Safety is concerned with protecting people from injury resulting from accidents caused by their carelessness or the negligence of others. This includes helping delegates take precautions when necessary, inspecting the event facility to insure that basic safety programs are in place and identifying sources of medical assistance that can be called in the event of an accident. Life Safety Protecting the physical well being of delegates is paramount. Life safety includes protection from natural and "man-made" emergencies. An event coordinator can do little about the fact that certain geographical locations are prone to floods, earthquakes, hurricanes, and tornadoes. However, he can determine what safety measures have been instituted by the meeting facility. Don't be reluctant to ask the sales manager, general manager or security director about the facility's emergency management plan. Most properties will be happy to show the coordinator what they have outlines in the event that guests must be evacuated from a hotel or convention center. If the property has nothing in place despite the fact that it is located in area 34
  35. 35. where acts of God are known to have occurred in the past, perhaps the manager might want to talk to their competition! Security Security is concerned with protecting people and property form injury or loss resulting from criminal activity. To help insure the security of delegates, inquire about crime prevention practices taken by the facility and in the surrounding area, and examine these policies. In addition, the manager will also want to "educate" his delegates about measures they can take to be more secure. 35
  36. 36. Reasonable care Common law requires that hoteliers provide reasonable care for their guests during their stay at the property. What constitutes reasonable care is determined by exercising foresee ability, anticipating what risks may befall a guest based on the type and level of criminal activity that has occurred at the facility and in the surrounding area. Hoteliers and event coordinators are not expected to prevent crime, and at best, reasonable care and foresee ability are terms open to interpretation. However, what is quite clear is that an event coordinator, is expected to assess how secure the guests he brings to a property will be base upon the reasonable care and foresee ability he exercises in his site selection process and while at the facility. This means that an event coordinator’s site 'inspection responsibilities include determining the quality of security provided by the property. His most knowledgeable point of contact is the security director, who should be happy to answer his questions. These inquiries can include types of incidents that have occurred on the property within the past year, what policies the facility has instituted to prevent their reoccurrence, and how secure members of the event group will be in the surrounding neighborhood. When the manager asks these questions, the answers should be documented because they are important in the unfortunate event that a security breach occurs. Don't eliminate destinations principally because they may be "unsafe." Incidents can occur anywhere. However, if the group’s event is in an area assumed or known to be less safe, ask that the security director attend the pre-con. When the manager visits a facility, be aware of how secure he feels, and add the following security items to his checklist. • Are side entrances locked at night and do they have a sign explaining this policy on both sides of the door with clear directions to an accessible door? 36
  37. 37. • Do first floor rooms have special security devices on the doors and window? • Are parking lots well lit at night? • Are staff members available for guests who wish to be escorted by security or management to and from the parking lot? • Are parking lots visibly patrolled at night? • Do surveillance camera casings actually contain cameras and are those areas monitored around the clock? • Does the hotel have executive level floors with limited access and a concierge on duty where a lady traveling alone, a controversial speakers or delegate can be assigned? • Do the sliding glass doors have secure locks and Charlie bars or security bars in the track to prevent someone from prying the door open from outside? • Do guestroom doors have deadbolt locks extending into the door jam one inch? • Do guestroom doors have a "peephole" and a secondary locking device such as a swing bar or chain? • At registration, does the front desk clerk write the room number down 'instead of announcing it aloud? • If a guest room key is lost or stolen, are replacements procedures followed that require guest identification and security escort to the room if identification is not available? Protecting Property Protecting valuable property is an essential aspect of having a problem free event, bearing in mind that hotels have only limited money liability for items stolen from their premises. They often post a disclosure to this effect at the front desk and provide safety deposits boxes for guest valuables. 37
  38. 38. Safe Storage Since not all valuables can fit into safety deposit boxes, hotels often provide storage security for merchandise that requires special protection. Discuss the secured storage areas the facility can make available, including how merchandise is inventoried and who might have access to the area. Number the boxes and inventory the contents of each. If the property has surveillance cameras, do they monitor secured areas around the clock? At trade shows, all contractors should be required to wear name tags, which can be color coded to represent the days of the week they are scheduled to have access to the exposition floor. Check with the security director, can the property provide 24 hour security if necessary or assist the manager in making arrangements for private security to augment what the hotel offers? If the event needs private security, the manager should notify the facility, only contract with firms licensed by the state, and check their references. 38
  39. 39. Educating Delegates The best safety and security system is ineffective if it isn't used properly. Hotels, CVB's and event planner associations make safety brochures available for guests. If the situation warrants, include a brochure in each delegate's registration packet. While the recommendations offered by the brochures are common sense, don't assume that the delegates packed theirs! International Meetings Unfortunately, terrorism is a reality and can affect any meeting. In addition to the security issues already addressed, if the event company is planning an international meeting, it needs to check with the State Department about destinations for which they have issued a traveler's warning and those that might require special security attention and educate the delegates before they travel to try not to stand out as tourists or foreign executives. Include information about the location of the American Embassy and other agencies that provide traveler assistance. A gentle reminder isn't meant to frighten anyone or discourage attendance. Instead, people should feel more secure that the event group has taken steps to help them and the facility is more attentive to safety and security. 39
  40. 40. DATA, COLLECTION, EVALUATION AND REPORTING Through every stage of planning, the manager will focus on numbers. The manager’s first call to a hotel involves numbers-number of people, number of function, number of days, number of amount in the events budget, how much income, how many expenses. As the planning progresses, the manager has to know the number of items to be printed and the number printed of each piece; the number of microphones, meals signs, flowers, gifts, and on and on. All of these numbers form a database and must be collected, analyzed interpreted, and finally documented in a useful format for future planning. This process completes the circle from concept to evaluation. It is the coordinator’s measuring stick for past events and his most important guide for the next event. The key areas are financial, attendance, food and beverages, program, and facility, also document personnel, marketing and mailing, and any other areas that give the manager information for future planning, decision making, or improving his next event The best test of the value of date collection and reporting is the impact the data has on the people who receive the report. Sometimes the manager will see the lights go on. For instance one client was recently shocked to learn that 40 percent of its attendance came from fifteen companies. That client is now adjusting its marketing efforts to encourage corporate groups by offering special rates. Another group was overbooking meeting space because it expected all registrants to participate. The data showed that "all registrants" included staff, volunteers, and speakers-people who did not routinely attend functions. Thus, the group was able to reduce meeting space by twenty-five percent. For one group, the lunch guarantees (the minimum it must pay for) were reduced by 300 people per function because the data showed the 20 percent of registrants did not participate in scheduled luncheons, but 105 percent (attendees and guests) attended evening awards functions The luncheon savings alone were worth the money it took to prepare the report 40
  41. 41. The possibilities are limitless. The key is to determine the data needed up front so the coordinator end result is consistent and accurate. If the coordinator wants to know the average age of his attendees, he has to devise a method for collecting that data. If the manager wants, to know attendees' positions within a company, instead off just asking for titles, he might also ask how many people report to them. Data collection is valuable only if the coordinator takes the time to analyze the results. For the most part, event coordinators are not numbers people, and they avoid dealing with statistics beyond the most basic requirement. The manager should tear apart everything he does, count actual numbers, and compute percentages for each category. Percentages allow the manager to compare categories and show him the pattern for his event group. He shouldn’t forget to document the variables that affect each year. A poor economy, high air fares or high hotel rates can affect attendance. Once the meeting has started, bad weather may increase the number of people attending functions; good weather may reduce the number. A great city versus a city without pizzazz may have an impact. 41
  42. 42. MARKETING AND PROMOTION Event coordinators are often responsible for marketing and promotion-for delivering attendees-and the manager’s success as a coordinator is often measured by the effectiveness of his marketing efforts. Promotional materials, such as letters, brochures, advertising, and new releases, are used to get the word out. Emphasize the thinking through of marketing and promotion more than the mechanics. The mechanical things must be done, but the risk of failure is significant if the event manager doesn’t think about what he is doing, why he is doing it, and for whom he is doing it. They are mechanical, routine procedures and practices, but only an organization can determine what the best marketing approach is for its attendees. There is no "wrong" way; if some thing works for the group and appropriately communicates the organization's image, then its right for the organization. To successfully promote an event, the manager needs to be sure that he has an event people will want to attend. Second, he needs to encourage the sponsor, maybe the boss, to be realistic about the attendance goal. Try to set a number that's a little lower than what he thinks the coordinator can deliver. Third, evaluate his obstacles. Is there enough time to properly market the program? Are there scheduling conflicts, such as college graduations? The point is if attendees are really the most critical ingredient then consider them in the beginning. It's dangerous to promote a event based on the organization's needs rather than on the attendees' needs. The wrong approach is copy and assume. We don't look at the market from the perspective of need versus saturation, the sponsor's credibility versus the competitions, the costs and incentives versus the value of the conference. Coordinators must also consider the drawing power of past successful events and potential attendees' word-of-mouth recommendations. Three key community leaders felt the sponsor had not treated them with the attention they deserved, and when asked 42
  43. 43. by other invitee if they were attending, they quietly and simply said no. Without further questions or explanations, word quickly got around, and the event was essentially blackballed. The petty reasons may never be known, but a lot of time and money was lost because the sponsors were more focused on the event than the attendees. The third point, which may not seem important to the manager need to be made a note off. When the manager considers promotion material he should not only look at the small list of ten points but to the event from a holistic perspective. 43
  44. 44. TYPES OF EVENTS Compulsory Events The type of event the manager is planning will affect how he proceeds. For example, there are corporate meetings that "advise" attendees of where to be and when to be there. The sponsor usually pays all expenses. The attendees; choice is, though subtly presented, to attend or resign from the company. The attendees' motivation is obvious, but the meeting can have a negative impact, especially if it requires canceling the family vacation. It is necessary to communicate to such people the importance of the events, explain why they were selected, and describe the benefits and value of heir participation to each of them personally and to the organization. While the company clearly expects total commitment from employees, it is good psychology to recognize workers' sacrifices and loyal support. Incentive events Such an event is held as the corporate reward or for outstanding performance. Some coordinators get involved in the total conceptual design of inventive programs, setting the sales and production goals as well as planning the reward, which is often an event in a highly desirable resort location. The recognition that accompanies the invitation is usually sufficient motivation to attend, and spouses are often invited. Who wouldn't want to go? Coordinators often use a dramatic invitation to stimulate those who failed to earn the reward this year to work harder so they will be invited next year. "Conglomerate "Meetings The most difficult of corporate meeting are the ones that bring together a company's distributors franchisers, sales reps, and other loosely tied field people. The coordinator's job is especially hard if attendees are expected to pay their own way. Such a group is comparable to association meeting attendees; a relationship and 44
  45. 45. credibility exist among those invited, but costs versus the value to participants have to be the marketing focus. Annual Meetings Associations are membership based organizations providing education, legislative monitoring or lobbying, certification, and other services to special interest or professional groups. They are run by and for their members. They are usually nonprofit, tax-exempt organizations that rely on dues, meeting fees, service fees, and, to a varying extent, contributions and grants. Whatever they choose to call the yearly gathering annual meeting, convention, conference, or incentive one is almost always held. The purpose for attendees is education, networking, recognition, and conducting official association business. The key to marketing the association's annual meeting is to offer a quality educational program. That may not be the real reason people want to attend, but participants need a strong educational program to justify their attendance and expenses to the company or the IRS. Getting the approval should not be forgotten. So there is some dual, albeit subtle, consideration in the event’s marketing. “Public” Meetings and Seminars These are sponsored by individuals, corporations, associations, or entrepreneurs and are marketed to anyone who is likely to come up with the fee. Such events are usually held to make a profit, to promote an organization, service, or cause, or to offer continuing education courses. They require large promotion budgets and carefully developed marketing strategies. The deciding factors in determining where the manager fits in the above categories are (1) the extent to which he has to create a market and (2) the recognition, credibility, and power of the event group to achieve success based on the invitation alone. If there isn't an existing credible structure, the event is probably in the "public" arena. 45
  46. 46. MARKETING CONSIDERATION There are three parts to the marketing strategy • Penetrating. The manager must get the night people to read the promotional pieces and sell them on the value of their participation. • Timing. The coordinator must reach his targets when they have the need, problem, interest, or time. That's tough, but he can try to anticipate the timeliness of his program. An investments program will likely be more successful in a strong economy. Tax subjects, are most popular from December through April or May, and issue programs draw best when the legislature is in session. Most are not so obvious, but a hard look and a few telephone calls may be a good investment of the coordinator’s time. • Selling. Keep in mind the real influencer and decision makers, may range from the attendees' boss and board of directors to a spouse, if the benefits of participation extend to them. And don't discount the children, who can be most persuasive in getting their parents to attend the event at Disneyland-as a Family of course! 46
  47. 47. DETERMINING ATTENDEES' NEEDS The list of attendees need is limitless. Where can a parent find say milk for a child? Where is the briefcase that someone left in a session yesterday? Why wasn't a reservation form or check received? The manager hears about all these problems: The room is too hot; the room is too cold; the room next door is too noisy; the room needs more chairs; the room needs more coffee. What's really necessary is that the manager should try in advance to plan for what attendees will need. He must try to make every attendee feel important and also must try to be helpful when unexpected crises come to his attention. With the vast array of conferences, services, and products for an attendee to choose from, the coordinator will find that he needs the attendees more than they need him. The place to start is with a familiarization exercise for attendees. Its object is to prepare a group profile by listing everything the coordinator knows about his actual or potential attendees. A questionnaire is useful in this respect and can be sent to attendees prior to the meeting. Provide some incentive for recipients to complete the questionnaire and return it with their registration forms, such as gift subscriptions to trade magazines, tickets for a free drink, or a discount on the registration fee. The questionnaire can cover such things as where they are from; religion; nationality; values; levels of sophistication; level of knowledge or expertise regarding the conference subject; if children or spouses will accompany them; if special diets, special needs or interpretive services will be needs; if they are used to luxury and a litany things. Once the manager or the coordinator has gathered all this information and sorted it out he needs to forwards to other parties who also require it, for example hotels. 47
  48. 48. SPECIAL EVENTS Everyone loves to have fun, and special events can and should be fan both for the attendee and the event coordinator. Not all meetings have a special event and not all special events, like fundraisers or company parties, are tied to a meeting. However, whether they are together or separate, they require the same skills. What are special events? They are gala dinners or receptions, theme parties, sport events, creative breaks, dances, tours, special programs, performances. They take the ordinary and make it extraordinary. They may have decorations, unusual locations, entertainment, unusual menus, creative themes, special transportation, gifts or prizes, surprise appearances of celebrities or robots. The sky is the limit. Actually, the budget is the limit but the event manager can still be creative. The fact is that much of the planning for special events is routine and tedious. The coordinator is dealing with a myriad of details that he plans, follows up, checks and checks again-and he'll still wake up in the middle of the night thinking of one tiny, but critical, detail that he will check on again in the morning. Creativity is the ingredient that keeps projects exciting and fresh and will definitely help him to avoid burnout. Special events are necessary to loosen up and lighten up attendees so they can interact on a real person-to-person level. First the coordinator begins with an idea or several, ideas, and then, unfortunately, most of us have to look at the budget. Is it affordable? If not how can we adjust the idea to make it affordable? Then he looks at the attendees and the organization. The coordinator probably doesn't want a magenta break for teetotalers or a three-hour bus trip for five-year-olds. The coordinator should not try to second guess his guest. Once the manager has matched the idea, budget, and people, he is ready to develop the idea into a structured plan. What will it take to pull this off? He is back to the basics of event planning: site selection, catering, transportation, decorations, 48
  49. 49. entertainment, insurance, repeal of city ordinances, themes, costumes, lighting, sound, security, licenses. From a management perspective, the manager also has to evaluate the reality of the lead time available to plan the event and the actual planning hours needed versus the time his staff can commit. It is the thoughtfulness of these early plans that will determine the ultimate success. In this age of specialization, the coordinator has a wealth of "experts" in every area, professional special events companies, because they plan these events routinely, can oversee all or a part of the event and will advise him of opportunities and pitfalls. The coordinator will also find suppliers of services expert in their individual areas. A bus company will help the event manager in routing and scheduling, a decorator can help him with space requirements and setup times, and a golf professional can help the coordinator structure a tournament. The manager must also do his own homework by talking to other coordinators who have conducted similar events, by reading related articles in professional publications and by checking the references of all suppliers. Finally, in getting it all together, don't rush or make hasty decisions. The highly creative people the manager will be working with are, all too often, high strung and demanding. The manager should hold on to his money tightly, put everything in writing, and give himself time to carefully think through his needs; don't be trapped by their needs. 49
  50. 50. THEME DEVELOPMENT Themes have been developed for almost every imaginable area. Here are just a few: Ethnic themes Mystery themes Movie themes Transportation themes T.V. themes Futuristic and Space Themes Storybook Themes War themes Historical themes Political themes Motivational themes Color themes Geographical themes Costume or Dress themes Sports themes Personality themes Seasonal themes Food themes Holiday themes Current events themes Way of Life themes Hollywood/ Bollywood themes Animal themes Negative themes (Such as a very successful annual dull party theme) Themes can be very powerful and a memorable experience or they can be a disaster. If a theme involves attendees' participation with either costumes or games, the risks are fewer. In such cases (more than ever) the coordinator needs to know his attendees, and often it's better to have attendees sign up in advance. Most people are willing to accommodate requests such as "black tie," "casual “or” western wear," but they might draw the line at dressing up; as Queen Victoria or a favorite rock star. (Incidentally, wait persons in costume are quite acceptable.) On the other hand, everyone appreciates creativity, especially new ideas or a new twist to old ideas. The interaction that takes place among attendees at well-planned, well executed theme events makes them worth the time, effort, and expense. 50
  51. 51. Sport Events Knowing a sport does not qualify the coordinator to set up a tournament. He is the expert on the event group. Especially as it relates to number of participants, time scheduled for the event, and general skill level of players. But a professional in the planned sport, with experience in setting up tournaments, is a critical ingredient. The pro will assign handicaps, pair players, set up start times and scoring procedures, arrange for judges, ball chasers, caddies equipment, etc. of course, the coordinator should be involved in setting the tone (Serious or fun), selecting prizes and giveaways, preparing a budget, arranging transportation, ordering food and beverages, registering attendees, and providing final court and player information. The pro and/or the resort should be certified and insured. But remember, any official event of the event places the firm, at a minimum, in a third-party liability positions. As the risk increases, so should the insurance. Companions’ program The part of the program that has gone from being called a wives' program to a spouses' program, and now to either a guests' or companions' program, has evolved from consisting of primarily women oriented activities (shopping, luncheons, teas, fashion shows, cooking classes) to gender-neutral events with more emphasis on enrichment. Actually, we should forget the companion's relationship to the attendee and just provide an open track of activities labeled the "enrichment program." This would allow attendees and guests both to switch from professionally related topics to personal growth and "see the city" topics and tours. Women still out number men as guests at conferences, and there are still women who like to cook and shop. Even male registrants sometimes cook and shop Conference coordinators should consider whether they want to encourage guests (both adults and children) to attend. If their attendance is desirable, keep this group in mind during site consideration (city, meeting space, room rated), and as the firm develops and prepares promotional materials, plans the budget, computes total numbers, 51
  52. 52. conducts registration processing, and establish a fee structure essentially, as the coordinator makes all his plans. A local committee or professional company can be a great asset, but the coordinator should not abdicate control. This is as much a part of the firm’s event as anything else. An unhappy guest can cause more trouble than fifty attendees can, especially if that guest is the president's spouse! Take a fresh look at the whole program. The best tactic may be to involve the attendees with guests, balancing genders, ages, and years of attendance to recommend an alternative agenda. 52
  53. 53. BUDGETING AND FINANCIAL MANAGEMENT The budget is the real event shaper; it puts all the theory into perspective. The manager will find out what is really important to his CEOs, members, or clients. It doesn't have to be an extravagant budget; actually, there are very few of those. The interesting point is where the money is spent, specifically when compared with the stated goals. The coordinator can't talk about expenditures without an evaluation of potential revenues. Fortunate indeed is the person who has a financial history of the meeting, or better yet, a budget not dependent on the collection of fees to cover costs. The manager needs some idea of revenues before he tackles the expenditures. This ceiling or range becomes a major management and planning tool for the coordinator. The history is an important to the budget process as staff resources are to planning schedule. If the manager doesn’t have a group history, he can, at a minimum, seek out trends for similar, programs or evaluate the general economic outlook. Normally, in good times, attendance is higher and supplier costs are less negotiable. Correspondingly, bad times mean fewer attendees and greater flexibility in negotiations. But this is not always true, so check the implications for the event. An event that emphasizes selling skills or employment opportunities may be better attended in tough times. Also in the trends area, event publications survey readers and publish results that tell the firm how money from corporate versus association events is being spent. There is a lot of good information available. If the manager takes the time to seek it out. Our industry's trends, suppliers, respected colleagues, and the event firm’s files are the most obvious sources. All too often, the budgeting process is seen as purely mathematical, while it is really an intellectual process in a mathematical format. The budget as a document is an important planning tool, but the true value is in the degree to which the manager uses it and in the accuracy and thoughtfulness of the 53
  54. 54. preparation process. The planning schedule reduces all the manager knows to people, risk, and deadlines. It is this combination that determines the road the event will take. The goals are the foundation; the planning tools are the supporting beams. Add a healthy dose of creativity in the interior design (program, speakers, food and beverages), this empty structure for the energy that only the attendees can provide. Ultimately, it is this combination that determines whether the result will be success, mediocrity, or failure. The event coordinator's role in establishing the budget varies, depending on the organization's structure. In some companies or associations, the budget process is closely guarded and the coordinator is involved only in the area of his or her responsibility. In other cases, a budget would never be prepared if the coordinator didn't force the issue. Format The beginning point in preparing a budget is research. Research can be in the form of bids, the economy in the host city, past financial reports on the same or a similar meeting, seasonal advantages or disadvantages, or national economic trends, such as the price of gasoline. The manager doesn’t need to be an economist but needs to observe, make notes and view it from a holistic point of view. The coordinator must take apart financially the event he is planning. There are many ways to divide the event into general categories that may or may not relate to the internal accounting system. If the event has only one account code, the manager will have a lot of flexibility in formatting his budget. If he is required to bill a variety of costs to a variety of accounts, prepare to work closely with the accounting office in the beginning. That aspect of budgeting is most difficult when government contracts are involved or when direct, indirect, overhead, and general and administrative costs must be broken out 54
  55. 55. The point is not that he understands the mathematical formulas for organization's accounting, but that the manager interfaces with the system for efficiency and accuracy. Now that the coordinator has all that information, he must organize the budget into categories. These are divides into income items and expenditures. Other schemes include organization by day, by fixed and variable costs, by profit centers (such as children's or spouse programs exhibits, or events with add-on fees), or by internal accounting codes. What ever be the requirements the manager must at all times list every possible expense item and the estimated cost. He must then explain exactly how he arrived at each cost figure-for example 2,000 four color, eight-page advance program announcements; or 200 lunches at Rs. 150 plus 25 percent tax and gratuity times three days. This explanation will be valuable in the monitoring and final accounting. Clearly, some areas are easier to budget than others, such as signs, furniture, office equipment and any of those areas directly controlled by the coordinator. Audiovisual is one of those areas not easily controlled by the coordinator, especially if he leaves all options open to speakers. Always the manager should go by the budget he might want the world but can the budget carry it all the way. Budget for "unanticipated extras" but also give staff and speakers deadlines for additions to the budget which the manager is on a tight budget, additions may also mean cuts. The video monitors may cut into food and beverages or decoration. A quick trip back to the purpose (goals and objectives) may provide guidance in additions and cuts. One the budget has been prepared and approved; attach a page for explanations of budget adjustments, with additional space for dates, changes, and approval signatures 55
  56. 56. SELLING SPONSORSHIPS Sponsorship has become an established communication tool for building brand awareness, brand image and corporate image. It is important to write a good sponsorship proposal and sell it in the most effective and efficient manner: A good sponsorship proposal must include: A) Title of the event: The sponsor shall be entitled to have the event named after the brand nominated by the sponsor. B) Background of the organizers and the events C) Types of Sponsorship available D) Details of benefits to various sponsors: This is the most important point, which is the backbone of the proposal, and the sponsor will only be given based on the benefits, which a sponsor receives. For example: Logo on advertising – the sponsor shall receive logos on all advertising related to the event, including all press advertisements, all posters, banners and hoardings which is of great benefit as the buyer now visualizes the media as described above and is more inclined to the event. Sponsorship: Who’s sponsoring whom and where. Some of the examples are: Sl No Company Products/Brands Event Category 1 Pepsi Soft drinks Sports, Music, Films, Fests 2 Asian Paints Paints Fairs and festivals 3 MRF Tyres Cricket 4 Seagram Liquor Music 5 Lee Jeans Special Launches 6 Hero Cycles Motor Bikes Hero Cup 7 SAIL Steel Manufacturing Football, Cricket 8 Colgate Products Dental Care Products Kite Festival 9 ITC Tobacco Products Sports (Classic golf, polo, cricket) 10 Action Shoes Shoes Sports 56
  57. 57. EVENT CONTROL SHEET In any event, an event control sheet is generally made. It takes revenues and costs into account. A Hypothetical example: EVENT CONTROL SHEET Costs Head of expense Units Days Cost/Unit or Days Total Cost Sponsored Net Cash Out Responsibility Phone Venue 3 100000 30000 0 0 30000 Mr. A 98xxx Artist 3 50000 15000 0 0 15000 0 Mr. AB 98xxx Branding 10 10000 10000 0 0 10000 0 Mr. C 98xxx Travel 5 3000 15000 15000 0 Mr. D 98xxx Food 200 100 20000 0 20000 Mr. E 98xxx Sound 1 100000 10000 0 0 10000 0 Mr. F 98xxx Lights 1 50000 50000 0 50000 Mr. G 98xxx Accommodation 10 3000 30000 15000 15000 Mr. H 98xxx Total Cost 76500 0 30000 73500 0 Revenues Title Sponsor 200000 Mr. K 98xxx Associate Sponsor 0 Mr. K 98xxx Associate Sponsor (2) 0 Mr. L 98xxx Ticket Sales 25000 ` Mr. N 98xxx Total Revenues 76500 0 225000 54000 0 It is now clear that the project now needs another 5,40,000 to break-even. Witht eh event control sheet in place, a firm will know how much the gap is, and will have to strategize as to how to bridge it. 57
  58. 58. KEY TRENDS IN THE INDUSTRY The trends of international events is fast catching on The year 2001-featured 20 international events in addition to the 2 annual events by the times group – The Fa Femina Miss India contest and The Manikchand Filmfare Awards ceremony. There were several blockbuster concerts by top international groups – Bryan Adams, Deep Purple, Scorpions Acoustica, Venga Boys and M C Hammer. The year 2000 featured 20 international events including several events on account of Millennium year effect. Accordingly, there is a trend of an increasing number of international events in India. Multinational companies have made popular artists their brand ambassadors Multinational companies have realized the growing popularity of live entertainment and artists with the masses. As a result, they are using such artists as ambassadors to promote their brands. For instance, Pepsi has appointed Adnan Sami as its brand ambassador while Coke has done the same with Aamir Khan. Live sporting events are also becoming big budget entertainment events Live events (besides cricket) such as tennis championships, golf championships are increasingly catching the fancy of sports lovers in the country. Corporate sponsors are also spending huge sums of money on such events. The year 2001 saw three major events – the Goldfalke ATP Tour World Tennis Championship at Chennai (billings approximately Rs. 80mn), the Gold flake ATP Tour World Doubles Tennis Championship at Bangalore (billings approximately Rs 65mn) and the Hero Honda championship at Delhi (billings approximately Rs 15mn) The trend of single city international events has been broken Concerts by international artists are now held in multiple cities as opposed to just one city earlier. For instance, the VengaBoys India Tour 2001 was a series of concerts across seven cities in India –Ahmedabad, Calcutta, Chandigarh, Chennai, Cochin, Hyderabad, and Luck now – and Colombo in Sri Lanka. The Bryan Adams concert 58
  59. 59. was held at Bangalore and Mumbai. This trend can grow rapidly provided obstacles such as high levels of entertainment tax and cumbersome approval procedures are removed in many states. The practice of ticketing for events has been firmly established The free lunch for consumers of live entertainment is over and ticketing as a practice has been established. The encouraging fact is that events, especially international events, were huge crowd pullers despite pricing of tickets. Cases in evidence were the sold out shows of Bryan Adams, the concert of Scorpions Acoustica (audience of 25,000) and Deep Purple (audience of over 30,000). This clearly brings out the value that Indians are attaching to quality live entertainment. The Indians event management industry moved a step towards organized activity The industry, which has grown over the years in a rather disorganized manner and still largely comprises non-corporate entities, instituted the Event management Association of India under the aegis of the Federation of Indian Chambers of Commerce and Industry (FICCI). With this, the industry has taken the first step towards organized activity. The industry forum should assist the players in addressing and resolving industry issues that are stumbling blocks to growth. Single window for central government clearances for inbound foreign artists has been created Managing an international event has been made significantly easier with the Government of India (GoI) entrusting the Reserve Bank of India (RBI) with the role of providing a single window for all the central government clearances necessary for a foreign artist or group to travel to and perform in India. However the processing of applications has been centralized at RBI’s Headquarters in Mumbai. 59
  60. 60. Key Issues & Challenges Besides generating revenues directly through sponsorships and ticket sales, an event also has a strong ripple effect on the economy. In case of a visiting foreign artist, GoI receives income tax revenues from the artist. The state government receives entertainment tax from the sale of tickets. The city municipality receives revenue in the form of hire charges for the stadium or ground where the event is held. The event involves a large number of people traveling to the venue. For instance, people from all over the country traveled to Bangalore and Mumbai for the Bryan Adams concert. Therefore, such an event gives an immense boost to the local industry such as hotels, restaurants and transport as well as national industries such as airlines, railways and logistics. Despite its revenue potential and spin off benefits, the industry is facing several issues that are impeding its growth. These are discussed below. Entertainment tax The entertainment industry has to pay two main taxes namely entertainment and service taxes. The entertainment tax in India is much higher than in other Asian countries and varies from state to state. It varies from 20% to 60%. The industry has appealed to the government to levy a uniform entertainment duty across India. This is perhaps the biggest hurdle the industry is facing currently. While event managers wish to hold events in more cities, the high rates of entertainment tax on ticket sales in certain states are forcing them to avoid such states. For instance, according to industry sources, Mumbai has become quite unfavorable for events owing to a tax rate of 40%. On the other hand, Bangalore has become a preferred venue primarily because of a low tax of 10%. A high tax rate makes events unviable and therefore, states that charge high rates will lose out on events, and potential tax revenues from such events. In contrast states that charge lower rates would attract more events and benefit fro m higher tax revenues. Hence, it is but clear that several states need to reduce their tax rates in order to become favorable destinations for events. 60
  61. 61. Global Comparison In developed countries in the west i.e. the USA, Canada and European countries, live entertainment is a very organized and advanced industry. Most individual artists/ entertainment troupes perform anywhere between 60 to 80 shows in these markets. For example, Depeche Mode, in the year 2000 from June 15 to November 05, performed 81 shows between Europe and North America, which total tickets sales of US $ 1.08mn. Besides music, there are also events for children like the Barney Circus tour, The Walt Disney Circus Tour, Magic Shows and a variety of other live entertainment events. On an average in a year, there are about 180 live entertainment shows in these markets playing at multiple venues, cities and countries. The live entertainment business is also closely linked to the record music labels, which work in tandem to promote and sell the music albums of popular artists. Besides western countries, the two other significantly established markets are Japan and Australia, and fast catching up with them are Singapore, Hong Kong and Bangkok. Entertainment tax for live events in certain states State Tax rate (%) Assam 130 Haryana 50 Maharashtra 49 Kerala 33 Uttar Pradesh 23 West Bengal 17 Karnataka 10 Tamil Nadu Nil Andhra Pradesh Nil Gujrat Nil (Source: Industry) 61
  62. 62. 0 50 100 150 Tax In % Assam Kerala Karnataka Gujrat Entertainment Tax for Live Events in Certain States Gujrat Andhra Pradesh Tamil Nadu Karnataka West Bengal Uttar Pradesh Kerala Maharashtra Haryana Assam 62
  63. 63. Withholding tax on foreign artists’ remuneration As per existing regulation, the event manager is required to deduct tax at the rate of 30.6% from the remuneration paid to a foreign artist. In most cases, artists require event managers to bear this tax burden, as a result of which events often become a non-starter. Given this scenario, India has the potential to host many more international events every year provided GoI reduces the withholding tax rate to a more reasonable level. More events would mean higher tax revenues for the GoI despite the reduction in tax rate. Simultaneously, it would also give a great fillip to the live entertainment business in India. Regulatory clearances for events There are several clearances required at the central level (for an international event) and the state level, for organizing an event. While the single window clearance facility with RBI has vastly facilitated central clearances, decentralization would speed up the approval process. At the local level, according to industry, on an average, 18 different approvals are required from various agencies for staging an event. State governments need to realize that they stand to gain substantially (in terms of higher entertainment tax revenues) if they make it easy and simple for event managers. A significant reason for Bangalore attracting many events is the helpful attitude adopted by the State government and city authorities towards the event management industry. Clearly the need of the hour is rationalization of taxes to a more manageable level of around 10%-15% across all states. Service tax The rate now proposed by the Budget is to be increased to 10 per cent from 8 per cent apart from a 2 per cent education cess on the tax element. This will have a detrimental effect on industry. Even if the industry passes the tax on to the clients, from the viewpoint of the client this would only desist clients from spending on events. The Government has budgeted a target of Rs 14,150 crore towards service tax for 2004-05 on the back of the enhanced rate and expanded net. 63
  64. 64. Infrastructure Industry experts believe that there is a need for large, international quality facilities in all major cities in India, supported by a network of hotels and domestic transport. This is because the current infrastructure in the form of event venues of international quality and size is not adequate. Mumbai’s largest auditorium, the 2800 seater Shanmukhananda Hall is generally booked for over 95% of the year. Corporatisation Corporatisation is on the increase, as more and more clients source services from large companies who provide better quality end-to-end solutions using experts. Corporatisation will eventually result in increased accountability, ability to benchmark performance and more accurate measurement of industry size and growth. Corporatisation also assists in obtaining finance, a key requirement for specialized players with high technology and equipment costs, as well as for promoter driven events. Having highlighted the issues and possible solutions, the potential for growth within the industry is immense. Ideation The use and re-use of event formats are not only diluting their impact but also confusing customers. The best example of this is the recent plethora of Auto Events. CNBC Autocar, ICICI Overdrive, Business Standard Motoring and BBC Wheels all held car and bike awards for the year 2003-04, within 2 months of each other. There is need to create newer, innovative event formats to capture target audience attention. Differentiation is the key. Innovative ideation also has a large export potential. Quality of services Quality of event execution remains poor in the main, as it is seen in the form of shabby sets, poor equipment and inadequate facilities provided during events – what 64
  65. 65. event managers attribute to the “chalta hai!” attitude. Specialization is clearly the way forward. Specialization is clearly proportional to the quality of the event, which in turn provides more option to the customer and even reduces cost. It also results in the availability of better event technology (lights, mechanics, fireworks etc), an arena which India is now catching up with the West. However, the lack of adequate number of specialists in many areas of event management still needs to b addressed. Training Training is another key initiative, which is required to improve the quality of output. A number of institutes like the event management development institute (emdi), national institute of event management, Mudra institute of communication etc provide part time and full-length courses in event management. Fresh talent is generally absorbed directly into industry. Promoter driven events With the expected increase in the number of promoter driven events a few years down the line (where ticketing revenues are larger than sponsorship revenues) risk will devolve on the event manager. Correspondingly, the focus will be on the project management to ensure promoter’s funds are deployed in correct manner, expenses are authorized and timeless are adhered to. Desired customer experience Given the large Indian population and growing per capita income, the demand for event remains robust. The key driver for success is the ability to provide the desired experience to customers so that their objectives are met. This can be achieved through ideation, careful planning and detailed budgeting. The flexibility to change event formats, create new types of events and execute them within the limitations of available infrastructure and resources (electricity, security, regulations etc. ) are key to ensure growth in the segment. 65
  66. 66. FUTURE PROSPECTS It appears that the future growth of the event industries, be it concert rock, pop or filmi, award ceremonies or the likes, hinges on two critical factors – rationalization of laws and regulations by the government to facilitate a health growth of this industry and a mindset change amongst audiences long used to freebies to pay for their entertainment., initiatives like the Event Management Association are positive steps already initiated by the industry players. The huge potential for this industry needs to be harnessed through improved product quality, which can be achieved through a sharper focus on meeting customer needs. Alliances with international event management companies, technological up gradation, and innovative ideation are the cornerstone for growth. As the company grows, assets like technology, stage, materials etc may be acquired to cut costs in the long run. Therefore, investment required may increase to include other assets like sound and light systems that are being outsourced. As the company becomes event savvy, more companies will budget for events in annual plans in the future. Currently, the profit margin is 15% annually, however with the growth of EMC’s and the price wars will see profitability fall. As Michael Menezes, MD – Showtime Events puts it, “the current year has been good – and things can only get better!” On account of these factors the industry is expected to grow at a healthy rate of 30% per annum over the next 5 years, to a size of Rs in 2006. Total Live Entertainment Industry Revenues (Rs. bn) 66 0 1 2 3 4 5 6 2001 2002 2003 2004P 2005P 2006P
  67. 67. (Source: Industry estimates) CASE STUDY Background of the alcohol industry marketing The fundamental about alcohol marketing is that lower the alcohol content, the less the need for image and brand building. From the graph below it can be understood that white spirits need significant brand building. In India, considering that dark rum is very cheap, it does not need as much brand building as the graph suggests. Least Image building Most Image building Required Required Beer Wine Premixe Rum Drinks Hard Cocktails Whiskey White Spirits Bacardi & friends Bacardi is a leading international white spirit. The product competes with other white spirits and also with beer, as it is targeted at the young adult. The product is more expensive than others in the category, and therefore the marketing is the challenge. 67
  68. 68. Bacardi advertises on television. The commercial portray “Bacardi” values of good music, sun, sand and surf….. and beautiful people. The general take out is that of a great beach party. Obviously, consumption of a colorless drink is a part of the commercial. The Task: Bacardi needs to do the following: 1) Demonstrate the Bacardi experience on ground 2) Encourage sampling 3) Build Relationship with customers. Note: Bacardi also wants to ensure that the people they communicate with are inclined to drink alcohol and would end up as unofficial ambassadors for the brand. Problem 1: How do you ensure that all those invited to an event are likely to be drinkers? Solution: Get a database of drinkers! Problem 2: If you are inviting customers at random, how do you know they will “gel” together? The solution: Bacardi & Friends To solve the first problem, Bacardi took into account the fact that they already had some kind of database. What if they invited all on their database, and asked each guest to bring along five friends? Bacardi’s database was consumers who had tried the brand earlier, or had attended earlier Bacardi events. It was completely reasonable to assume that friends of their invitees were likely to be people like them. In other words, drinkers as well. Bacardi rolled out a new property called “Bacardi & Friends”, where each invitee was given the “honor” of bringing along another five friends. 68
  69. 69. In order to ensure that these possibly unconnected consumers would “gel” Bacardi created a variant of the party, they announced B&F advertising parties, TV parties and so on. This ensured that all the guests at the party had something in common other than alcohol, and therefore were to enjoy each other’s company. Hi Summary Writing a below the line brief All briefs need to have some basic details, whether the task is below the line or above the line. These will include: The brand The target audience The objective The budget The campaign period The geographical target For the Bacardi & Friends example given earlier, the brief could have been something along the following lines: Brand: Bacardi Target Audience: SEC A, B, C+, 18-25, M/F Objective: to increase brand salience, to ensure sampling Budget: Rs 5 lakhs Campaign Period: October Geographical Target: South Mumbai Task: Create an event, which will reinforce the Bacardi image, and reach as many new consumers as possible. Strategy should ensure that very few non-drinkers attend. Event should have adequate values for PR. Requirements: Concept, all collaterals including posters, invitations, branding at venue, merchandise. Recommendation of venue, entertainment. All budgets to be included in the presentation to the client. 69
  70. 70. CONCLUSION From a fledging industry, live entertainment is becoming big business. Large corporates are sponsoring events, and are using the opportunity to market their brands to a focused audience. The future is expected to see more events, especially international events, drawing larger crowds and leading to higher ticket sales. Television channels, in their relentless quest for viewer ship, are expected to commission more events and also buy telecast rights of events. Revenue sources such as merchandising rights and internet rights, hitherto untapped, also hold out significant potential for event managers. High entertainment tax in certain states, high withholding tax on foreign artist payments, the proposed service tax, cumbersome clearance procedures at the local level and lack of exhibition infrastructure are the chief stumbling blocks to growth. GoI and the state governments should address and resolve these issues as they stand to benefit considerably from the industry’s growth. 70
  71. 71. REMARKS Going forward, the live entertainment business is set to show strong growth on account of several factors. Events are fast becoming an integral part of the marketing strategy of companies. Events score over conventional mass media in several ways- exclusive coverage for the sponsors, a huge captive audience to watch brand advertising and opportunity for product trial so that product attributes can be effectively conveyed to the target audience. In comparison to these benefits, the cost of sponsoring an event is reasonably small. For those reasons, companies are expected to take to sponsoring events in a big way. Live entertainment events, especially international events are drawing people in large numbers. International artist too are making India a part of their global concert tour. Once regulatory and taxation obstacles are over come and multi city events become an established norm, the number of international events is expected to increase rapidly. Hence, ticket revenue are also expected to show a steady increase in future. Television channels are looking for driver programmes to boost viewer ship and events offer a unique genre of programming. Television networks can either commission events for their channels or buy telecast rights of events from event managers. In both cases, the industry stands to gain. Commercial exploitation of merchandising and interest rights in future by event managers would further boost industry growth. 71