Grow Your Recovery Strategy – Preparing for the Inevitable Economic Upswing
Send this article to a friend
While many meeting professionals struggle with declining corporate budgets, Tami Forero has been busier than ever. Her company, Forte Events in Colorado Springs, Colo., which specializes in corporate and nonprofit meetings, saw its best year in 2008 and projects close to US$1 million in sales for 2009, its fourth year in business. She has built her company from a one-woman show to a six-person operation at a time when many players in the industry are struggling to stay afloat.
“I almost feel guilty, because so many people are hurting right now,” Forero said. “We’re the most expensive people around as far as our services, but we know how to explain to clients why our services are worth it.”
Having spent most of her 17 years in the industry as an internal meeting planner for corporations such as BankAtlantic in Florida, the veteran knows how to make her company invaluable in uncertain times. Her growth strategy centers around helping clients get more out of their events at lower costs, without cutting into her profits. Rather than discounting her rates, Forero has instead invested heavily in site surveys to find towns and properties around the U.S. where she can offer clients luxurious events at lower prices than they would pay in glitzier destinations.
Sometimes, she has encouraged clients to hold events in her home base of Colorado Springs, where her relationships with local vendors help her to negotiate better prices than she can get elsewhere. Often, she says, clients are so happy with these less-sought-after venues and destinations that they request the same one the following year.
“We shock them and that’s why we get so much work,” she said.
But that’s just one piece of the puzzle. While big corporations may ask their internal meetings teams to handle more events in house, Forero realizes from her own experience in planning about 90 events a year that there is only so much a corporate team can tackle effectively.
“It’s really hard to come up with two events a week,” she said.
So she has made the Forte Events team available to help corporations with meetings and events that have fallen through the cracks, supporting their teams with hourly consulting work, such as troubleshooting planned events. On top of this, her company has branched out into “idea brokering,” providing overextended corporate planners with creative concepts for events they are too busy to dream up.
“That’s been a huge niche for us in this economy—working with big corporations that can’t rely on the services from their internal planners,” Forero said.
Like many seasoned meeting professionals who have weathered earlier recessions, Forero realizes that there’s no time like the present to poise her company for growth. U.S. President Barack Obama and Federal Reserve Chairman Ben Bernanke have recently pointed to the first signs that the recession may be slowing. And Forero and many other veterans are realizing they’ll be in a stronger position if they find realistic and creative solutions to challenges that are likely to linger for some time—such as tight corporate budgets, increased media scrutiny and new trends, including the move to lower-priced virtual meetings. Indeed, senior-level planners project a 6 percent dip in business in 2009, compared to last year, according to the February 2009 MPI Business Barometer, sponsored by the MPI Foundation and American Express.
So how do you come up with your own recovery strategy when you’re coping with the fallout from the worst downturn since the Great Depression? If history is any guide, professionals in every industry who take the time to find creative ways to help others cope with tough economic challenges often emerge in the strongest positions when a rebound finally comes. Consider what happened in the airline industry during the grim days that followed Sept. 11, 2001. With major airlines reeling from a sudden drop in business from terrified travelers, low-cost carriers ramped up their capacities. They enticed travelers back into the skies with great deals, making sure to keep flights full so they remained profitable. Today, more passengers are using these carriers than before the tragedy, according to the U.S. Bureau of Transportation.
Whether you are looking for a job, working around the clock in a corporate gig or hustling to grow your own business, the first step to position yourself for a recovery is to step back and take an honest look at what you bring to the table professionally.
“A recession is when you take stock of how you’re doing business,” said Joan Eisenstodt, a 40-year-veteran of the field and founder of Eisenstodt Associates, a hospitality and meetings consultancy from Washington, D.C. “But people in the industry are so busy figuring out how to survive that they’re not thinking about what the future brings.”
Build Your Professional Capital
Sharpen your professional skills. Although Eisenstodt has trained many in the industry during her long career, she makes time to keep attending educational conferences so she can bring her clients cutting-edge knowledge and new planning techniques. Recently, she traveled to the International Association of Facilitators conference, certain that building her own professional capital was worthwhile.
“That’s one of the things that people get nervous about in a recession: Can I spend the money to improve my own skills?” Eisenstodt said.
Doing so is always a good investment, she says.
“It’s showing employers or clients that you have new skills to bring to the table that others might not have,” she said.
And with technology-driven trends such as virtual meetings reshaping the industry, keeping up can mean the difference between sitting on the sidelines and thriving.
Other veterans are positioning their teams for recovery by attracting new talent now, when job seekers are plentiful. After working with her staff to create a recession-survival strategy that included reducing daily office expenses and negotiating better prices with vendors, Joyce Landry, CEO and co-founder of the cruise event specialist Landry & Kling, recently expanded her team.
“We now have several employees who work remotely and are utilizing long-term outside contractors for more projects—to expand our staff while keeping our expenses to a minimum,” Landry said.
Forte Events’ Forero hired a wedding planner in January as part of her growth plan for the recovery and is already seeing ROI.
“She’s doing really well,” said Forero, who is now ramping up for another new pursuit: funeral planning.
Your New Recession Mantra: Diversify
It’s not lost on longtime meeting professionals that a recession can be a good time to add to the mix of services you offer—a goal that often gets put off during economic booms.
“A lot of companies get into a specific niche, where they are very successful,” said Roy Podell, who has worked in the industry for 30 years and now serves as creative director of Atlas Travel International’s Meetings + Motivation division, based in Milford, Mass. “The problem is when things go south and that niche gets heavily impacted.”
So, although Podell’s division gets about half of its business from Atlas’ corporate clients, he doesn’t want to depend too heavily on that revenue stream. To diversify, he has expanded his team’s offerings from conventional, full-service meeting planning to à lá carte work on tasks such as site selection. His employees handle both group and individual incentive programs, instead of specializing in just one. And they have branched out into registrations for both user groups and meetings.
“The diversification came about as a result of listening to our clients’ needs and adapting to the marketplace,” he said.
To make sure his eight-person team can handle its broad responsibilities, he has always hired employees with an eye for those who like to tackle the unfamiliar. Not only does his approach bring his team challenging opportunities for professional growth, but it has paid off financially.
“It’s not going to be a banner year, but we’re weathering the storm because of our diversification,” he said.
And once the economy turns around, he believes his division will be in a stronger position than before.
Strengthen Business Relationships
Finding new ways to bring more value to clients is also a good way to position yourself for a recovery, and Forero’s approach to site selection isn’t the only way to do it.
After starting her career working with technology firms in late 1990s, Sharona Meushar, president of Tel Aviv-based Sharona Marketing Media Events, learned to help her corporate clients run high-quality events on tight budgets during the technology market collapse. To that end, she arranges partnerships to share the cost of meetings with other noncompeting firms, so her clients don’t have to reduce quality to save money. In February, for instance, she helped her long-time client, Access Partners, a banking solutions provider, to reduce its overhead at a conference in Bahrain, by arranging a partnership in which it shared expenses with two other firms. Result: Access Partners maintained a high-end presence without the usual price tag.
“If you’re going to play host to an event, I advise my clients to not go cheap on the drinks and foods,” Meushar said. “It doesn’t serve the purpose. It’s better to partner up. You’ll make the company and its solutions look better.”
Meushar has also generated repeat business by helping clients on very tight budgets to come up with high-impact ideas that cost little to implement. For instance, when a telecommunications client hired Meushar to help with its presence at an electronic communications convention held near Amsterdam in 2006, Meushar arranged a field trip to its server farm that turned out to be a big hit with company guests.
“People were thrilled about it, and the only cost was the bus ride,” she said.
Even meetings with more traditional formats can be an opportunity to bring more value to clients without higher costs. For instance, when Warren Levy, president of Compelling Meetings in the Philadelphia area, planned a law firm’s annual partners meeting two years ago, he persuaded his client to opt out of the traditional approach to panel discussions. Instead, he enlisted a moderator to pepper the speakers with tough questions on new developments in the industry and to encourage them to elaborate on points of disagreement. The firm got such positive feedback from its partners that it hired him to plan the following year’s meeting. Running a meeting this way takes an extra effort to get panelists to buy into the idea in advance, he acknowledges.
“The challenge is you have to pick speakers who are willing to do that,” he said. “There are some panelists I describe as inert. They want to make their point of view known and go.”
Giving attendees more opportunities to interact with speakers informally can also add value to client meetings without a higher price tag, Levy says. At a recent healthcare related meeting for a global consulting firm, he arranged in advance for the speakers to sit at tables among the senior executives who attended when they weren’t at the podium, to foster more offline discussions.
“It would have been interesting to have them there just to speak, but it’s much more revealing and original to have them interact with everyone,” he said.
Levy believes such measures are necessary at a time when many executives are questioning whether they should bother attending certain meetings at all.
“CEOs have made the decision that their time is too valuable to attend meetings, unless they are going to be interacting with people who are critical to them,” he said.
Reap the Rewards of Easing Clients’ Pain
Responding to clients’ challenges with flexible solutions can also build loyalty that will serve you well when times are better, say longtime meeting professionals. Kevin Priger, who began working in hotels 22 years ago and became senior sales manager at Macon (Ga.) Marriott City Center in March, recalls a recent situation when a corporate client approached his previous employer to see if it could cancel the contract for a big event. The vice president of the client’s company came in to explain that while he wanted to go ahead with the gathering, large meetings in its budget were coming under intense scrutiny as the economic situation deteriorated.
“It blared on the radar,” Priger said.
The VP said he would prefer to have several smaller meetings that would have the same outcome.
Realizing that the company was in a tight spot, the hotel came up with a replacement contract that allowed the client to pay the cancellation fee but apply it to several smaller meetings. Ultimately the tab came out to be about the same. While the hotel could have taken a tougher position with the contract, Priger believes that would have driven the client elsewhere in the long run.
“I believe this is a relationship business,” he said. “If we don’t have a long-term view when we face these downturns, we’re going to be abandoned by these customers.”
While few industry veterans recommend across-the-board price cuts in a recession, some say that an occasional discount for a struggling client that you want to work with long term can pay off.
Eisenstodt describes a group that wanted training at the end of the month.
“They said they had only so much to pay. It was one-third of what I normally charge,” she said. “We talked it through. I had the dates open, I was willing to do it and it was a subject I liked. They paid a few of the expenses I would normally include in the fee, and I came down on my price.”
When making decisions like this, it is essential to consider the financial impact on your company carefully, Eisenstodt says. To avoid future misunderstandings, she made it clear during the negotiations that the discount was a one-time thing.
“If they had not said they would pay the additional expenses, I couldn’t have done it,” she said. “It would have been much too great a loss for me.”
You should also think through the effect your decision to cut prices will have on your clients’ willingness to pay full fees in the future, she adds.
“I’m getting e-mails from all kinds of organizations saying, ‘Register now for our conference. We’ve reduced our registration fee,’” she said. “What if I registered six months ago, and now you’re offering it at half price? Where’s the fairness? You have to look at the implications of what you do. It’s about saying, ‘What can I do to get short-term business and keep long-term business and relationships?’”
Although it may be tempting to play hardball to get better rates from desperate vendors and suppliers during a recession, taking a more moderate approach now may be a wiser approach for the long term, Eisenstodt says. If they go under because they can’t turn a profit, you’re likely to suffer from lack of the services you need during periods of higher demand.
“The hotel can’t lose money on everything,” she said.
With her phone ringing all day with cold calls from suppliers hoping to drum up business, Eisenstodt takes a few minutes to talk with them, even if she has no immediate need for their help.
“They may know another vendor where I can get a better rate for something,” she said.
Being helpful to others in the industry even when there’s no immediate payoff is a time-tested way to position yourself for a recovery, Eisenstodt adds.
“Look at every single contact as someone who can help you, and make your meetings—and your long-term prospects—different,” she said.
As many professionals are learning, the more people you have on your side in an unpredictable economy, the better.
ELAINE POFELDT is a freelance business writer.
• See more Meeting Professionals International (MPI) news
Number of views of this article: 5,329
Tags, news section:
Tags, event suppliers:
Event Planner Spain, S.L.
Paseo de la Sierra, 38-20, 29018 Málaga, 西班牙
© Copyright Event Planner Spain 2006-2013
Tel. +34 952 294 327