The New Metrics of Highly Successful Events
The scorecard for almost any event that I encounter is the same—some measure of revenue, attendance and satisfaction. These aren’t bad—they are necessary indicators of success—but they aren’t enough.
The truth is that non-profit event organizers seldom look at the most important metric of all—ROI.
ROI is the first and most critical measure used by for-profit, commercial event organizers (your true competitors). Can you imagine not measuring the return on investment of your retirement account?
When you think of ROI, think bang for your buck: If I spend a dollar, do I get something more than a dollar back? If so, how much more and by when?
We all know that we have to increase event revenue (registrations, exhibit and sponsorships dollars) and keep costs in line. But when should you be spending more to make more? And what should you be spending on? A more important question is: Who should you be investing in?
Here are the most important questions that the best event professionals are asking and answering:
- What is my acquisition cost? How much do I spend to get my next attendee, exhibitor or sponsor?
- What is my retention cost? Who and what should I be investing in to keep my attendees and business partners coming back each year?
- Here’s my favorite—LTV. What is the lifetime value of my attendees, my sponsors and my exhibitors? How much are they worth over their lifetime? What is their lifetime? How long do they remain loyal?
Did you know that the average lifetime value of a Domino’s pizza customer is over $4,000? Amazing, right? Imagine what the LTV of your best attendees might be—many are easily worth over $100,000 to your association. Knowing this might influence how you invest in them, welcome them and offer them something more than other attendees: For example, a concierge reception experience, a special lounge, a nicer hotel room, a personal thank-you from the CEO.
The answers to these three questions are relativity easy to calculate and will change how you invest, with whom you invest and how much profit and bottom-line income your event produces.
Breaking even is a bad strategy and should never be your goal. Make as much profit as you can—use the additional income to subsidize revenue for your best members, offer better food, hire better speakers and improve the experience.
People respect what you inspect—what numbers do you inspect? What numbers does your CFO require?
I promise you that these three numbers will have a big impact on how you plan, market, sell and deliver your next event. If you would like to know how to calculate these powerful metrics, drop me a note.