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December 2010

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Your events and tradeshows are big investments. Are you sure you're getting a return?


By Barry Seidenstat

Your events and tradeshows are big investments. Are you sure you're getting a return?
Insure your event and tradeshow success by using Voice of the Customer information to facilitate stakeholder agreement, to assist in determining measurable objectives, drive event execution and measure return on investment.

Marketing organizations are under increasing pressure to measure the outcomes of their investments. Organizations need data to determine their best marketing investments, be they print, social, web or other marketing tools. What techniques can organizations use to produce high return tradeshows and events that address the needs of attendees while delivering powerful, measurable, strategic results for the organization? How can organizations compare event and tradeshow investment vs. other marketing activities?
Read on to see how to:
  • employ proven tools to ensure event and tradeshow success and achieve measurable return on investment (ROI).
  • Understand stakeholder analysis and leverage attendee input to overcome internal politics and secure management buy-in.
  • Define measurable objectives and develop an event plan to achieve those objectives.
  • Move up the evaluation ladder from measuring basic attendee satisfaction (How was the shrimp?) to measuring: learning, application, implementation, impact and consequences, and business results. In other words, understanding how the event effects what attendees think, feel, say and do during or after the event.
  • Use VOC data to focus resources on event elements that achieve the greatest return - and reduce or even eliminate spending on those that don't.
  • Most importantly, calculate your event's ROI.
Measuring events and tradeshows follows a simple five-step process:
  • First, a review of ROI Measurement:
  • The value of your event or tradeshow is determined by how well it achieves each of its objectives.
  • Break-even is where total cost equals total value created.
  • Positive ROI is in proportion to amount by which achievement of each objective exceeds the break-even level.
  • %ROI = (Actual sum of objectives performance / breakeven performance) - 1
Now, let's go through the process:

STEP 1 - Gather Voice of the Customer to assist in defining event objectives
Voice of the Customer is a qualitative and quantitative research technique that produces a detailed set of customer wants and needs, organized into a hierarchical structure, and then prioritized in terms of relative importance with current alternatives. Gather VOC by asking your audience, participants, and most importantly, stakeholders questions regarding what they need to: Drive business, be an advocate, increase investment, learn, etc.

Be aware the output of this research will be the input to the development of your measurable objectives. It's important at this stage to make sure your results are credible, reliable, precise, accurate and actionable.

It's also important to make sure you have buy-in from your event stakeholders. You'll need to perform stakeholder analysis to assess the attitudes of the stakeholders regarding potential event objectives. It's important to note your stakeholders can be anyone in your organization who may be affected by the event's outcomes. Stakeholder analysis has the goal of developing cooperation between the stakeholder and the event project team and, ultimately, assuring successful outcomes for the project by assuring event objectives can be agreed upon.

Different types of events and tradeshows will naturally have different types of objectives. Here are two examples of B-B event types and some typical objectives and their weights. (color coding will be used throughout the example to help readers follow along) Your objectives and weights may be substantially different. It's important to note objectives must:
  • Be defined in terms of business value
  • Be measurable
  • Have weights assigned based on importance and the potential to create value
Event Type Sample Objectives and Weights
Channel Partner Conference (dealers, resellers, franchisees) Promote channel investment (45%)
Increase channel effectiveness at selling company products (25%)
Increase channel loyalty (15%)
Understand partner needs (15%)
Trade Show (sponsor) Generate qualified leads ((40%)
Enhance brand position (30%)
Set post-event appointments (20%)
Intent to buy requests (10%)
Step 2 - Define quantifiable metrics

To define quantifiable metrics, you must answer the question, “As measured by how?” Bear in mind, your “how” measurement must reliably measure the ultimate results and be agreed upon by the stakeholders. Measurements are generally based on how the event affects attendees: Intentions, Perceptions, Preferences, Attitudes, Abilities and Behaviors. Or, what attendees: Think, Feel, Say and Do post-event.


You'll measure different types of data in different situations and places. Some data will be measured by noting observable behaviors at the event or trade show. Other data will be measured by understanding what and how attendees think, feel, say and do after the event. Still other data will be measured in ultimate results. These measurements can include company performance, growth, etc.

Please note there are direct links between metric, value and ease of measurement - the more direct the measurement, and the greater the value of the measurement, the more difficult it is to measure.

Next, we need to define the possible metrics we'll measure and the weight assigned to each one. We'll use a simplified Partner Conference example to show sample metrics and weight.

Event Type Objectives and Weights Metrics

Channel Partner Conference Promote channel investment (45%) Partners agreeing to new investment program (100%)
Increase channel effectiveness at selling company products (25%)
Partners signed up for training (50%)
Partners using new sales tools (50%)
Sales (30%)
Sales of new widget based on event demo (100%)

Step 3 - Plan Event and Determine Break-even for Each Metric

At this point, the actual planning of the event must take into account the event objectives. Event budget dollars should be strongly focused on delivering against objectives. Again, all event content should lead towards delivering on event objectives. Event content that doesn't drive towards delivering against objectives should be reduced or eliminated. If your attendees have told you the happy faces video at the end means nothing to them, don't spend money on it. Save it or invest it somewhere where it means something to the attendees.

The event owner desires the event to have a positive ROI. From the ROI equation shown earlier, we know we need to understand the net total event cost including opportunity cost of employee time. For each metric ask: What is the lowest performance level that would make the event just worth holding, given the cost? Narrow in on your break-even level - pick an achievable middle value.

Because stakeholders are the consumers of the results, determining break-even levels is an important stakeholder exercise!

What's important to sales may not be important to marketing. The next chart shows sample objectives and metrics and our newly devised break-even level expressed in units to be measured. For example purposes our sample event cost is $1,000,000.

Objectives and Weights Metrics Break-even level (Unit)
Promote channel investment (45%)
Partners agreeing to new investment program (100%)
50% of partners agree within 30 days based on information received at event
Increase channel effectiveness at selling company products (25%) Partners signed up for training (50%) 80% of partners sign up 60 days post-event
Partners using new sales tools (50%) 85% of partners use tools 60 days post event
Sales of new widget (30%) Sales based on event demo (100%) 75 units within 45 days
Step 4 - Gather Tools and Collect Data Before, During and After the Event

Which tools do you use to collect data? Depends on the data you are collecting.
Data Area Tools
Event Plan Budget, Defined & Measurable Objectives
VOC Pre/Post Event: Interviews, survey
During Event: Interviews, kiosk, personal smart device
Attendance Door Monitors, RFID, business card, personal contact, etc.
Interactions Card readers, notes, etc.
Leads/Sales Closed loop lead capture/sales PSR/data system
Cost Spend analysis of the event
As a reminder, usage of some tools and collection of some data may be more difficult to use and collect than usage of other tools and collection of other data. Do not be discouraged by this. Make sure you can use the tools and collect the data that supports the objective measurement requirements. As long as stakeholders are in agreement with both the objectives to be measured and the relevance and accuracy of the data collected, your results will be valid..


Step 5 - Run the calculations.
UNIT Weight
(W) Metric Metric Weight
(MW) Overall Metric Weight
(OMW) Break- even
(BE) Actual Score
(AS) Actual vs. Break-even
(ABE) Weighted Actual vs. Break-even
(WABE)
EQUATION
(W) (M) (MW) (W)(MW) (BE) (AS) (BE)/(AS) (ABE)(OMW)
Objective
(From Above) (From Above) Multiply From Above Collect data Divide Multiply
Promote channel investment 45% Partners agreeing to new investment program 100% 45% 50% 55% 110% 49.5%
Increase channel effectiveness at selling company products 25% Partners signed up for training 50% 12.5% 80% 50% 63% 7.9%
Partners using new sales tools 50% 12.5% 80% 85% 106% 13.3%
Sales of widget introduced 30% Sales of new widget 100% 30% 75 units 90 units 120% 36%
TOTAL 100% 100% TOTAL = 106.8%
The total in the last column is the percentage above or below your actual performance vs. the break-even performance. A successful event will have a number greater than 100%.
Now we can determine our event ROI using our ROI formula shown noted above:
(%) ROI = 106.8% - 1 = 6.8%
($) ROI = $1,000,000 x 6.8% = $68,000
This event returned nearly a 7% ROI or $$68,000 based on event value.

Conclusion:
Tradeshows and events are a big investment. Companies need to make sure they are getting a return on their event marketing investment. Measuring event ROI is critical to the understanding of what marketing tools are most effective for your organization. Event measurement, while modestly complex, need not be difficult. If cross-functional teams agree to measurable objectives and metrics, event elements and content can be focused on the achieving desired results and achievement providing the greatest return - and reduction or even elimination of spending on those event elements or content that don't. Event measurement enables management to evaluate events vs. other marketing and investment opportunities.

About the author:
Barry Seidenstat has over 26 years of broad experience in brand and channel marketing communications, event management and production; brand management, and database lead generation management. He successfully uses his six-sigma quality certification and its VOC process in all the communications he produces.

Throughout his career he has been recognized for his ability to develop and implement strategies and processes that market and sell, increase productivity, enhance quality and improve cost effectiveness. He's had a variety of marketing communications positions with Coors Brewing Company, General Electric and Multimedia By Design. Currently he is the owner of ROI Communications Solutions, an event marketing.

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