Let’s Talk About Event Budgeting!

Talking about event budgeting can understandably seem daunting and confusing. What even goes into budgeting for an event and how can we know for sure that we can trust a certain event production company? The trusted hosts of Event Brew are not afraid to talk about budgets, though, so neither should you!

In today’s Event Brew podcast, Will encourages Dustin, Nick, and Thuy to talk candidly about event budgeting. They approach the matter from the perspectives of both the event planners as well as the production companies. They explore the reasons behind the fear and distrust that often accompanies conversations about money and prove that it doesn’t have to be that way. When partnerships are built on trust, budgeting conversations can be just as exciting as discussions about engagement strategies.

Event Budgeting: The Suppliers’ Side Of The Story

First off, Will talks about event budgeting from the perspective of an event company. “Our sales reps are trained to get the budget. If you don’t know what the budget is, you just end up shooting in the dark. As a supplier, when you hear that they don’t know what the budget is, it gets frustrating. I just want to know whether I can work with you and what I can do!”

Dustin wonders where the hesitance around sharing the budget comes from. Thuy is the first one to make an educated guess. “Maybe they know their overall budget, but they don’t know your particular budget of service and product that they have to do. Or maybe, they’re uneducated on your rates.” Navigating the events industry definitely isn’t an easy task. “Once you get into being a part of a creative industry, there are lots of different ways you can spend money and lots of different people that will take your money,” adds Dustin.

Be Upfront About Your Budget

The Event Brew crew agrees that it’s not necessarily an exact number they expect. Giving them a range, for starters, would make things easier for both parties involved. “What vendor isn’t willing to re-edit their quote or shave things off, add things as you go through the second and third revision? I’m totally down for that,” says Will. “The hardest part is when they come in, you are making guesses and then you get ghosted because it turns out you were way too high or way too low.”

“I always give so much more value to those that are upfront with what they have. I find that my and my team’s time isn’t wasted. If you need a $40,000 show and you have $35,000 and you tell me that upfront, I am so much more forgiving when it comes to the numbers than I am if you have me over-quote,” says Dustin. “One of the unfortunate things is that when you’re constantly having to beat budgets out of clients, they start to think that’s all you care about. But all we care about is proper parameters to do our work in.”

Event Budgeting: The Event Planners’ Side Of The Story

Next up, Nick looks at event budgeting challenges from the perspective of event planners. “I don’t think we do anyone any favors by having overlapping skill sets and making up our own titles. So, when event planners have event budgeting conversations, they don’t know who they’re talking to and they don’t really know the limit to your contributions. They don’t know how much money to leave in reserve. They’re never showing their full hand because they don’t know where the bottom’s going to pull out because a lot of what we do seems like smoke and mirrors.”

“Event planners are put in a position where they have to do this work because it’s part of their job. If they do a bad job at hiring an event company, there can be bad repercussions. If they do a good job, that’s about it – they just did their job. They’re operating from a place of fear more than anything else,” elaborates Nick.

Talk To Those Who Have A Stake In The Event’s Success

In his opinion, the success of budgeting discussions really depends who you’re having conversations with. “If you were talking directly to a marketing or sales in an unsiloed way, as opposed to someone who’s been allocated the events portion of it and pushed out, they might play ball with you. They might show you their full hand because they have a stake in the game. When you’re dealing with people who don’t have any stake in the success, they’re often just managing and mitigating the negatives. Then, that puts you in a position where there is a lot of deception and not a lot of clarity.”

Luckily, he knows how to overcome this problem. For starters, it’s a great idea to ask event planners the following question: “What are your investment goals for this? What do you need to achieve that is verifiable? Then, you can talk about percentages of what it costs. That’s the real conversation: what percentage of your goal is acceptable for this to be a win?” concludes Nick.

Where Does The Fear & Distrust Come From?

“The fear of getting ripped off is huge. I used to think it was just the AV budget, but as my company has expanded its services more, I’ve realized it’s across the whole events industry,” says Will. “People are just afraid that costs are going to get out of control. There’s a level of distrust that if they give the vendor a certain number, they’re going to come in right at that number because they’re going to inflate it to get to that number.”

And rightfully so; Nick and Dustin confirm that indeed, some companies do just that. To prevent that from happening, event planners can go through the questions they should ask a production company. “Getting people you trust in this industry involved earlier in the event budgeting process can be incredibly helpful,” adds Dustin.

Privacy Is Not Always The Best Policy

Thuy talks about the dangers of being too private. “I don’t understand why some clients keep the end-user undisclosed. I just get stuck. There’s a privacy portion to it. But then, on the other hand, some people are fearful that they might take it and run with it directly. If you don’t disclose the event budget, or even who the end-user is to me, I want you to go and do that research.”

Dustin agrees but thinks that general trust in the events industry is slowly, but surely building. “Maybe that’s coming from some confidence or people are realizing that you’re only going to do your best work with the best information,” he says.

“Our industry is grappled with this fight for legitimacy. Also, there are too many expectations for us. On one side, expecting people to know all these different disparate skill sets of planning, creative design, business, marketing concepts, and practical things like lighting and food. Not to mention the shifting environments and new technologies …” adds Nick. He connects the challenges of event budgeting to the current state of the entire industry. “We’re all planning for things in a future that no one quite knows. So, not to give your whole budget at this time is a pretty fair thing to do. After all, they can’t know if people are going to actually want to be in face-to-face, for example, or they’re absolutely frightened. What is required now is a lot of hedging and modular budgeting.”

Building Trust Leads To Transparent Event Budgeting

The final part of the conversation about event budgeting circles back to building trust. “If you were to bring in your vendors, hire slow, and bring them in early, that would make all the stakeholders whole and happy. Let’s talk about goals before we talk about budget. What matters is testing that relationship and hiring your vendors like you would HR,” says Nick. “We have to start thinking about trust as probably the most important thing when it comes to ROI.”

“If you have trust, budget becomes less of an issue,” Will agrees. “But how can you accelerate trust?”

Dustin has an answer ready right away. “We have to deliver exceptionally. Be transparent and upfront. Not every relationship starts with trust. Sometimes, we have to earn it. Oftentimes, we think that it should just be there because we’re award-winning as if that instantly means they should trust us. When we’re dealing with a client for the first time, the onus is on us to build that trust.”

Conclusive Questions For Event Suppliers To Chew On

Before they say their goodbyes, Will asks what the Brew Crew thinks would be great trust-building questions event planners could ask suppliers. Nick goes first, channeling the abovementioned HR mindset. “Tell me about a time where you lost the trust of a client and what did you learn from it.”

For Thuy, it’s all about showing that they have good character. After all, the relationship between the client and the supplier is a partnership. “Tell me about yourself personally.” Simple, yet profound!

The practical Dustin is next. “Based on my event budget, where should I focus? Where should my priority be?”

Will’s question is a bit more philosophical. “What does transparency mean for you in the event budgeting process?”

After the quartet poses their versatile questions, Dustin sums up today’s topic. “What a buyer needs to know is that you price competitively. Nobody wants to pay double what they should for something. They want to know that you do your research and that you’re going to bring creative solutions. They want to know that you’re going to be the one that has their back and it’s going to make them look good. Because at the end of the day, everybody wants to look good. They want to get a slap on the back from the CEO that says great job. And can you accomplish that.”