Event Budgets Part 1
All too often do I hear the phrase "but there isn't the budget" coming from clients and event providers alike. From my earliest days in the business I always found the concept of 'value' fascinating. This article is all about budgets, how to use them, and the concept of 'value', in the true meaning of the word.
Let us start by defining 'value'. This word has come to mean how 'cheap' something is; i.e. how little it costs, irrespective of quality. Value is really all about what we get for the money we spend.
Let us take an example of buying lunch. A lunch for one could cost anywhere from £2.50 right up to £90. We would all agree that a £2.50 lunch is low-cost and a £90 lunch is expensive. But what about value?
Value is about how well the product we gets fulfills our objectives given a fixed budget. So let us imagine that I have a £7.50 budget to buy my lunch and the purpose of buying lunch is to give me healthy sustenance and within my busy schedule.
Imagine I go to a busy coffee shop where I wait in a queue and spend my entire budget on a extra-grande mocha-choco-latte with extra cream, marshmallows, four squirts of flavoured syrups with a side of a chocolate brownie. I have spent my budget. I have received an elaborate and expensive product. But I go away with a sore stomach, feeling a bit fat and still needing something balanced and healthy to keep me going. And I am late for my next meeting.
Now imagine I find a small gourmet sandwich shop. This shop sells me fine coffee, a smoked salmon with creme-fraiche bagel and a small freshly squeezed orange juice all for £7.50. I have spent my budget. I have fulfilled my dietary needs. And because the shop is efficient and professional I have left in good time to make it to my next meeting.
In these scenarios I had a limited budget, but one option presented value, while the other did not. So we now understand value.
Value = how well we fulfill our requirements within our budget.
In the events industry there is much talk about budget. Budget is treated as a constant that correlates directly with how successful your event is.
It is a fallacy that a budget directly relates to the quality of your event. The same budget can be used to create two completely different events with two completely different outcomes.
Experience has taught us that, no matter how small (or big) the budget, considerate prioritisation can make any event a success.
Client and event professionals alike must always start their planning by defining the objectives of an event. This must be done before thinking about venue, catering, decor, guest numbers or even the date. In the context of my example; are we looking to get a healthy lunch or are we looking to impress the waiter with our obscure coffee request?
Is the event about creating a beautiful day for a married couple? Or is it about increasing brand awareness? Is it about showing recognition? Or is it simply a chance for some associates to meet and have a good time?
Once we have established the purpose of the event we can then look at what the most important elements of the event are. This then gives us some frame to allocate budgets.
I have always aimed to understand what a client is trying to achieve from their event. It is surprising how often the client's objectives are very different from what you might expect.
Event Budgets Part 2
In the previous section I discussed the concept of 'value' and how important it is to first know what our objectives are when considering budget allocation. In this section we will look at 'hygiene factors' and 'feature elements', which will help us to know where we should aim to make savings and where splashing out is a great idea.
Once we know the purpose of the event we can then look at 'hygiene'
Feature elements are ones which if not present will not necessarily be noticed, but if they are present will add positivity to an event. Feature elements could include stunning venue decor and lighting, or a champagne and oyster bar.
Many event organisers and clients allocate too much budget to a hygiene factor which could be procured for less. For example, if you need to light a car park for practical purposes find the method that is inexpensive and effective (like festoon lighting), rather than hiring in several tower lights.
Many others allocate budget to feature items while disregarding hygiene factors. I have seen clients spend a small fortune on impressive plasma walls, but skimping on appropriate ambient venue lighting.
Getting the most from a budget, or offering the best value, is first about fulfilling hygiene factors for the lowest reasonable cost. It is secondly about finding appropriate feature items that contribute to the event objectives and are affordable.
Our company approach has always been based around this philosophy. We have developed many services around offering exciting feature services that are within budgets. For example, we focus a lot of our energies on creating the perfect overall aesthetic to a room using drapery and lighting. We often provide visual 'talking points' that are in line with objectives, such as enormous video screens depicting brand imagery.
Written by our associate Johnny Palmer, Director of SXS Events Ltd