ROI–our un-conventional approach to planning conventions and conferences

First, a little moralizing…

Remember at the depth of the global financial crisis when every executive retreat and sales incentive trip became a symbol of capitalist arrogance?  The media had a field day implying that, in the light of bankruptcies and foreclosures, management was laughing at the rest of us from hot tubs at ritzy resorts.

We have been invited to speak at scores of industry conferences, association conventions, and company incentive trips, and we have never seen anything like the media envisioned.  Maybe we just don’t get invited to those parties.

However, our “un-conventional” approach stems from a very different moral issue.  If conventions and conferences don’t live up to their value potential, then they are a waste of money.  It doesn’t matter if they are fun. The moral obligation is to deliver education and execution first, entertainment second.  Instead of putting all your creativity into making the event unforgettable, create an unforgettable payoff.  Get the highest return on everyone’s investment.

Here is one scenario to explain the math of ROI.

We took ROI responsibility for a conference of a mutual group of 100 top financial services producers.  We estimated their average annual income at $500,000 each and divided that by a hard-working 50 weeks of productive revenue-generating time.  By that calculation each day spent attending the three-day meeting plus travel days was worth $2000 to every attendee.

So, from the producers’ perspective breakeven could be measured as $10,000.  They needed education and execution ideas that would make or save them $10k.  If we couldn’t deliver that value we knew they would be crazy to come to the next meeting just to lose money.  Of, course breaking even could not the goal.  So, wee doubled it.  Deliver $20k ROI for hero status.  Deliver <$10k and they don’t come back—which means we won’t be asked to come back.

Now, what about a corporate calculation?  The total revenue at stake was 100 x $10k = $1M.  The corporate mutual entity operated on a percentage of the group’s revenue.  However, typical of sales conferences, much of the cost was absorbed by vendors who want access to the producers.  Clever strategy, but this just shifts the costs to other entities that have their own ROI.  The ROI calculation never goes away, and for this entity it was a matter a growth.  This meeting had achieve an additional $1M of growth.  Attendees and the meeting leadership were on exactly the same page.

Here is a quick checklist of ROI benchmarks.

If past meetings are on the wrong side of these ten questions, you need to apply the ROI standard to every meeting going forward.  Even if you are on the right side of all these problems, you should see if the ROI math can verify that.

• Do attendees arrive early or at the very last minute?
• Do they wait to the very end to go home or blow off the last sessions?
• Does the audience actively engage with speakers or politely applaud with minimal questions?
• Is the foyer filled with cell phone conversations or are more chairs needed in the main hall?
• Do emcees effectively connect speakers and audience or just give bio facts and a parting thank you?
• Does the presentation technology work flawlessly or turn into a running joke?
• Are meal conversations more about the meeting topics or telling stories?
• Do the leaders reinforce the group culture or gravitate to longtime friends?
• Do the entertainment elements support the meeting theme or are they perceived as extras?
• Do you need to analyze the evaluations or is your intuition about the mood obvious?

ROI and Opportunity Cost

Read the definition of opportunity cost, “the loss of potential gain from other alternatives when one alternative is chosen.”

Is that what is on your attendees’ minds?  A successful conference or convention or retreat will eliminate any thought of opportunity cost.  Attendees should be thinking there is nowhere else they would rather be.  Not because they are having a great time, but because they can sense their firms growing with what they have learned or envision their jobs becoming more productive and fulfilling.

We recommend you invest your meeting capital in ideas that educate your attendees with ideas for higher levels of growth.  Help them execute with ideas to achieve higher levels of performance.  Entertain them so that they realize the relationship capital they gain by being part of the group.

What’s next?

In the next blog post we will examine how to earn the highest return on that investment.  How to make good decisions about education, execution, and entertainment.  How prepare for the meeting like you are professional “meeting” athletes.  How to keep every minute focused on ROI before, during, and after the meeting.  For now, get your calculators busy.