For the first time in months, I feel like the Live Events industry is on the right track. There’s a long way to go. We aren’t all happy about it. But at least our course is starting to feel durable.
I don’t have a crystal ball and there are some big factors outside our control, but here’s why I think we are going to be okay:
We Corralled Our Audiences
Until recently, my biggest fear (after COVID-19 itself) was losing our position in delivering effective audience experiences. There was a lot at stake when in-person meetings began canceling or postponing. Without a solid alternative, we risked losing our customers.
The need wasn’t to simply replace the in-person meeting with the remote meeting. Organizations weren’t flying thousands of people to destinations because they liked burning through cash. There was ROI in these events. We needed to speak the language of the stakeholders — not the event planners.
Stakeholders could have easily bypassed the technology rental space and moved to ERP platforms, television production, or marketing agencies. Those suppliers would have sourced help through their networks and not ours. Production Rental companies would have ended up at the bottom of the food chain, renting light kits and pipe and drape poles.
Of all the things that could have bitten us hard, channel disruption was the most dangerous. Losing revenue is nothing compared to losing relevance.
Thankfully, the alternative channels were no more prepared to deal with virtual meetings than we were, but we had the advantage of understanding the technical challenges and how to solve them. We also had the relationship and didn’t intend to let it go.
We’ve planted our flag in the virtual meeting space. Now we need to own it.
Virtual Meetings Are Finding Their Way
In March 2020 there wasn’t really a virtual meeting industry to speak of. Sure, everyone has streamed an event at one time or another, but that’s different from producing a virtual event. At least 80% of the work in an online experience occurs before the first attendee logs on.
There were some horror stories, and not just the ‘presenter with no pants’ Zoom stories. How about cramming three days of ballroom content into a virtual format? Or worse, a virtual trade show?! If we thought audience retention in Las Vegas was bad, it was worse at home with the kids, the dogs, and Amazon Prime deliveries.
Thankfully, many of you used drive-through high school graduations as a testing ground for virtual production. Once you crank out several thousand 5-second videos of graduates, you pick up a thing or two — for instance, how to price it next time!
Platform, process, and professionalism. We have a lot to offer and more to come.
We are finding our way.
Outsourcing Isn’t All That Bad
This summer was a roller coaster of emotions as we moved through layoffs, furloughs, PPP payroll subsidies, unemployment subsidies, and eventual restructuring.
There were many aha moments as I spoke with business owners who suddenly realized their former employees would be happy to come back on a part-time or per job basis. Companies that rarely hired freelancers were now crewing entire events with seasonal workers.
Sometimes the medicine tastes terrible, but then it makes you feel better. Pretty soon you associate the flavor with the benefit. So goes it with outsourcing. Many of us have traditionally leveraged our full-time staff as a selling point. Now, it makes sense to tout a “team” that includes strategic partners such as freelancers and other service providers.
It will be difficult as we move forward with minimal business to keep our trained work force in the Live Events industry, but there isn’t much of an alternative. Business will come back, but it will have a different shape and need a new set of skills. And not all of our workers want to make that transition, much less wait around for the work to return.
Instead, we will learn how to manage a shared workforce. The upside of minimizing overhead will offset the downside of competing for temporary labor. The math is a bit different, but it’s still just math.
Seeing so many companies embrace a smaller staff and redistributing the workload gives me hope that, as an industry, we can reemerge more scalable and more profitable.
When?
That’s the big question. When will business come back? It wouldn’t be fair to bring you this far and not be honest. I preface the following with, “I don’t know, but…”
I believe that Live Event production companies that embrace the agency model, stay on top of developments in the virtual meeting space, and master selling pre-production will enjoy a more profitable future than they would have had if COVID-19 never happened.
They will need to own less equipment and employ fewer full-time staff to manage larger volumes of business than pre-COVID times.
The question most people are really asking is, “When will things get back to normal?” When will the warehouse full of equipment start generating income again? When will we do shows in ballrooms and convention centers like before?
Sadly, it might be another year before the live audience is larger than the remote audience. Even then, the remote audience will have shown an ROI and become a permanent part of our regimen.
In the meantime, rental companies that switch to producing events might be able to replace 50-75% of their revenue by end of Q2 in 2021. To project further has a lot of “ifs”.
If we get a vaccine, if people regain the confidence to travel and gather in larger groups, and if all the supporting industries adapt to less dense meetings… only then can we start counting down to once again seeing 2019 levels of business.
But remember, for the same amount of revenue in 2019, you should see double the profit in 2021. If not, we have wasted a golden opportunity.
That’s what I know right now. I will update my outlook as I see circumstances evolve.
Please leave a comment. Agree or disagree. Share an alternative view. After all, we are smarter together.
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Evolve or perish. Interesting to read about a shared workforce with no mention of ‘gig workers.’ Wondered if that was intentional.
I have expounded on gig workers and the gig economy extensively. Check out The Show WILL Go On
webinars and related blog posts over at Intentional Success Network. Clearly there can be no shared workforce without a gig economy. One of the big issues for business owners that are anchored in processes that rely on trained employees (and a familiarity with all the broken features of their processes) is, how will they operate with workers that may not be there every day? Shared workforce is when two or three companies collectively train a pool of warehouse workers (for instance) on their common rental software and processes. We are already seeing staffing companies support specific software as a skill set.
Tom –
Thank you for the optimism.
For Scenic companies like mine
This is especially difficult.
We need a show that’s bigger than a bread box. Competing with Green screen and cgi is not profitable . So we sit in moth balls and wait.
I don’t disagree with you Ray. If you define scenic as only one thing, then you are stuck. That is the point of pivoting. What goes in front of the green screen? Are props and decorations scenic? Can you marry a series of virtual background with foreground pieces as a package set? Bigger shows will come back, but you don’t want to lose your market share to the companies that met the challenge we have right now. Meet your customer where they are.
Interesting perspetive. My main question would be, if shared workforce becomes the norm, what then becomes a company’s competitive advantage?
If our internally-developed processes, training, methodology, skills, and talents become either shared by other companies due to shared workforce, or irrelevant because staff is not with us full time or exclusively to learn and embrace those above-mentioned traits, what then separates us from our competitors?
I often sell that our staff/people is what makes us so great. Anyone can buy equipment; human capital is our differentiator.
If me and my competitors now all share the same workforce, that no longer becomes a competitive advantage.
Unless I am misunderstanding your perspective, which is certainly possible.
Brian, I think you get the gist of it, but you might be looking at this a little too black and white. We already do this on show sites with stagehands and incidental labor. Most companies engage lead and specialist techs that are freelance who might be working for your competitor tomorrow. What changes is the mix of staff to freelance in customer-facing positions. Being on staff shouldn’t define someone’s value (and many freelancers would rightly argue that they are more skilled because of the diversity of the work they do). As for warehouse operations, that workforce is not customer-facing or even proprietary. Your processes can be unique to you, but I have spent years helping folks whittle down to best practices instead of reinventing the wheel in Ops.
So the question that is left unanswered is “what becomes of a company’s competitive advantage?” That is exactly the right question. If competitive advantage is the people that you assemble (as staff), that advantage is easily wiped out by a competitor that recruits and retains better. So, it isn’t much of an advantage from that standpoint. (“I like Bob, but now Bob works over there…) vs (Oh, look Bob is with us on this show).
A true competitive advantage will be strategic. Business is about identifying the right customer, offering the right product or service, and managing price and cost to make money. The best combination of qualities properly presented to the right audience and consistently delivered is a competitive advantage. This works for business and for independent workers as well.
The workforce is a tool you apply to accomplish tasks. The intellect, processes, and outcomes you deliver can still remain uniquely yours. The relationships, brand, and image you convey are still yours.
Thank you for your answer. I agree with much of your assessment but I still think that the knowledge and experience I have gained and developed over the years that I teach to my syaff (i.e. “the way we do things”, “our secret sauce”) gets lost the more workforce is shared and I think that will hurt my company from standing out. Perhaps we simply disagree on that front.
Do you think the Patriots brand and success would be as strong over the last 10+ years as it had been if Bill Bellichick and Tom Brady could have played (i.e. worked for) whatever team happened to need them that Sunday, or do the Patriots lose a lot of their competitive advantage if the NFL’s workforce was shared? Just curious on your take on this fun hypothetical (unless you are a Jets fan…)
Brian. I understand your point, but YOU are the secret sauce. I agree that in a shared workforce world, your secret sauce will need tweaking. That is my point. We can’t rely on what worked before if the fundamentals have changed.
To use your NFL analogy, if players were shared then the differentiation would be coaching. We already think that coaching is important, but that would change once sharing started. New rules, new game.
If you choose to rely on employees and proprietary processes and the rest of the world standardizes and shares stock resources – is there enough of a target customer to pay your higher costs? You aren’t wrong in choosing this path, but the trade-offs are evolving.
Great questions!