August 31, 2015 by Jeff Hurt
How financially sustainable is your conference?
Too often the metrics we use for our conferences are lagging indicators—inputs and outputs. We measure our P&L, attendance, sponsorship, exhibitors and attendee satisfaction.
But that is not enough! We need to measure leading indicators.
The VCC team gets asked repeatedly how to know if a conference is successful or not. And conference organizers ask us what metrics they should measure. Here’s a modified repost of seven metrics you should measure immediately to see if you’re conference’s warning sign is blinking.
What’s a shatterpoint, you ask?
A shatterpoint is like a fault line, crack or an area of weakness in a path of action.
In Star Wars, shatterpoints are a juncture in the Force where things are especially vulnerable. One little change in that shatterpoint can have a domino effect with drastic galactic consequences.
All conferences have areas of weakness and vulnerability. The challenge is identifying the symptoms of these shatterpoints early to make plans to improve them. We need to evaluate our processes, frameworks and data to identify shatterpoints so we can neutralize them. Or we face cataclysmic results!
Goals are objective metrics. They answer the question on whether we’ve arrived and met our objectives. They’re lagging indicators.
Shatterpoints are the leading indicators you can use to diagnose the state of your conference. They can have a gigantic impact on your future conference results.
Imagine being in college and taking a road trip with your friends. Two of your backseat drivers continually ask you, “Are we there yet?” They are asking a goal related question.
Now imagine your front seat passenger asking, “How much gas do we have and need to get to our destination? And how much money do we have to buy gas?” Well, both of those questions identify shatterpoints. If you run out of gas and no one has any money, the entire road trip comes to a halt.
Very few meetings and hospitality professionals talk about conference shatterpoints or key performance indicators (KPIs). Most measure the inputs and outputs of the conference. We need deeper analytics through KPIs.
Remember, if your KPIs drop or don’t meet standards, you’ve hit a major fracture and you’re conference is in dire need of help. Or it may crash.
Here are seven conference KPIs that you should regularly measure and benchmark:
Your conference should have a 50% or higher paid attendee loyalty.
Loyalty is defined as an attendee that came two out of the past three years (or more) and paid at least one or more of those years.
Anything less than that shows vulnerability in your conference sustainability. (Note: This is paid attendee loyalty. If you provide discounted or free registration for speakers, don’t include them in these metrics.)
Your conference should have a renewal rate of 65% or more of its exhibiting companies. Very healthy conferences attain this by selling 70% or more of next year’s space during or before this year’s expo.
Strong, healthy conferences have a renewal of 75% of sponsorship revenue. If this isn’t happening, you either have an attendance issue or your sponsorship strategy is not aligned with what your attendees value. Attendees don’t value logos and session sponsor ads!
For conferences and tradeshows that have multiple revenue streams, the secondary revenue category (registration or expo+sponsorship) should be at least 30% of total revenue.
Unless your organization has specific age limits on attendees, 35% of your attendance should be under the age of 50. Experience is often more important than age. What will your conference demographics look like in five or ten years?
At least 55% of your conference’s direct expenses should be invested in the paid attendees’ experience. These include areas like speakers, entertainment, AV and production, and food and beverage (F&B). If 55% of your direct expenses are going to F&B, you are investing too much money into the attendee’s stomach!
Identify, measure and nurture your top attendee economic buyers. For some organizations, it means measuring participation and revenue of the top 30 companies. For others, it means measuring top key segments.
How does your conference compare to these seven shatterpoints or KPIs? What tools do you use to identify and measure KPIs to make your conference more sustainable?
Filed Under: Business Model
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