The whole world is talking about it, including the Brew Crew: inflation and recession are on the horizon – yet again. In certain industries, it has fully arrived. But since the events industry is so interconnected with the rest of the economy, event profs are also starting to feel the effects of rising costs and labor shortages. We cannot help but wonder and worry: are events going to survive?
Nick, Thuy, and Will take on this complicated topic. And even though things are looking bleak, there is a way to overcome these economic challenges. All it takes is a little bit of creativity, empathy, and intentional design. Tune in and find out!
Inflation & Recession Have Arrived
“Everyone’s talking about inflation and recession in various industries,” Thuy says. “Whether it’s your gas, oil, or plane tickets. When it comes to the event planning world, it’s just another challenge and not a roadblock. In times of inflation and recession in events, I ask: how can we overcome this? If inflation rates are high and this affects the price of some food, we have to choose alternatives in our catering menu.”
“Similarly, if transportation and gas prices are high, then let’s pick locations that are closer to the venue. I also encourage suppliers that if prices are going up due to inflation and recession, increase pricing. There’s a reason why your rates are your rates,” she adds.
“Ultimately, transparency is the answer to most of these problems,” says Nick. “In the B2B world, you need to be solutions-oriented. Don’t take your clients for granted. Tell them you can get creative and determine what really matters. Flexibility means that you’re creative.”
But there’s a silver lining in inflation and recession. “This is also a big push for us to move towards sustainable events,” says Will. “There’s a cost that you pay and there’s a cost that the environment pays. If you get creative, you can solve both problems with one solution,” agrees Nick.
“Never doubt a hotel or an airline’s ability to charge more money. And this is true in a non-inflationary environment,” Will adds. “They’re always going to try to find a way to make as much profit as possible. But the thing is that for the last two years, everybody’s been losing money. Event technology companies are an exception. They were printing money. Now, they are starting to feel the hurt because things are slowing down.”
“Every company’s trying to recover all their losses from the previous two years. Not only are there inflation and recession, not only is labor hard to find. On top of that, we got to make back the money we lost. The events industry is probably going to feel prices the hardest out of anybody,” he concludes.
Present Changes As A Feature, Not A Deficit
“I haven’t seen widespread adoption of synchronous hybrid events nearly to the amount that thought leaders thought,” says Nick. “It’s because of diminished resources. And the majority of event professionals are not interested in virtual, it isn’t why they got into what they do. It takes a special person in the industry to have a passion for both. It’s not the default persona.”
“I think that people are going to blame inflation and recession. But in reality, maybe they’re not properly budgeting,” adds Will.
“It requires you to set expectations too,” replies Nick. “Do not say that this event is going to be less than. Double down on your mission and what your event is about. Focus on hard tangible results.”
For example? “There are a lot of instances where portions of events can be longer or shorter,” he explains. “A portion of it could be done virtually. Do the things that you can only do in a face-to-face setting. You could do a flip classroom model where the education is done ahead of time. And you come to the event, engaging people in conversation around the homework that you did going into it. Take a three-day show and turn it into a two-day sort of summit. There is a lot of creativity you can embrace if you’re willing to change how you do things. Don’t show it as a deficit, show it as a feature.”
Inflation & Recession: Go Virtual
In the second part of the conversation, Will is curious to know how the looming recession is going to affect the events industry. “When recessions hit, what usually goes is people’s less important expenses: travel and events, for example. Our attendees are going to feel the inflation and recession in the upcoming year or two,” he says. “If the recession comes, it will kill a ton of events.”
While the times ahead are hard, it’s not impossible to find solutions. “There are more options now than there ever have been as far as ways to distribute content. Embrace multiple opportunities that are all intentionally designed. Don’t simply put it on Facebook Live,” advises Nick.
Nick has noticed that many event profs do not want to do virtual events. “They don’t want to invest too much in the virtual event because, in their minds, they’re incentivizing people not to come to the in-person event. As much as you’re into ‘hospitality’, you’re not being very hospitable. If you are just designing for people that have disposable income and are empowered from their organizations, you have a very limited point of view.”
Conclusive Thoughts About Inflation & Recession
To end the episode, Nick tells a story that dates back to 2009 when he worked at Catersource. “Mike Roman was giving a presentation, called ‘Recession is a Terrible Thing to Waste’. He was thrilled and excited that there was a recession going on at the time. He said that those who are creative and can offer real value, they will rise to the top.”
“There were corporate holiday parties that went extinct”, he adds. “It was just about spending money to show off excess with no real ROI.”
The main lesson is this: in times of recession and inflation, be extremely transparent in your business relationships. Those who have strong client relationships will survive. Give them value and show that you care. After all, their problems are your problems too.