These days, if a meeting program survives economy-induced budget cuts and the AIG-induced imperative to appear less extravagant, it’s likely to take a more streamlined, no-frills form. Participants can expect to see little in the way of special events, entertainment, tours, dine-arounds, gifts and the like. “We used to have clients that would let groups pick from four or five different activities to do on a day, such as golf, spa and fishing. All of that has been cut,” observed Rebecca Garforth, director of operations with Dublin, OH-based Destinations by Design. “We’re seeing the most decline at sales meetings and annual kickoffs.” And even incentive trips, where diversion is the order of the day, have been scaled back.

A Rock And A Hard Place

The trend was already evident last summer, when the Incentive Research Foundation (IRF) conducted a survey of incentive travel providers, corporate incentive travel buyers and suppliers entitled “Effects of a Down Economy on the Incentive Industry.” A full 81 percent of respondents felt the economic slowdown was having a negative impact on their ability to plan incentive trips. And 33 percent noted that onsite inclusions, such as paid meals, pillow gifts, spa treatments, water sports, tennis and golf, are being pared down. At the same time, however, respondents indicated that they are “striving to enhance the participant experience,” the IRF reported. A new IRF study released in May revealed that despite the economy’s challenges, most incentive planners are “unlikely to switch from travel incentives to another program initiative,” and that while these programs may have to be scaled back, they are still considered to be valuable strategic tools to help achieve business goals.

Planners continue to face that tension: On the one hand, event budgets are tighter, and the “extras” are a natural area to cut costs. But on the other, reducing them turns incentive programs from inspiring to merely rewarding, and eliminating them outright makes annual meetings feel like strategy or training seminars.

“It’s a cost savings at least on the surface,” noted Stacey Krizan-Ruth, CEO and chief creative officer of Atlanta, GA-based The Wow Factory. “But what message does it send to employees and how does it affect their morale? And what is the cost of that?”

There is indeed an economic squeeze, and employees will surely understand why meetings have become “leaner and meaner.” Yet if a planner can find a way to provide a few perks and still come in under budget, so much the better for participants’ enthusiasm. The alternative to canceling special events and offsite activities is, then, to run them more cost-effectively, and therein lies the challenge to the planner. A gala, for example, must feature venue, décor and entertainment components that are compelling enough to justify holding it in the first place. The thought process here, said Krizan-Ruth, is “We’re going to stage it and try to hold firm to the experience, but we’re going to try to slim it down dollar-wise and not let it be too apparent to the attendees.”

Boston-based Corinthian Events designed and produced this budget-friendly event at the State Room in Boston. Corinthian Events Partner Mary Coch offered this description: “A local real estate company needed to launch a new logo and wanted to make a big splash. Without a huge budget, we opted to hold the event at the State Room in Boston and let the dramatic views of Boston set the scene, saving on décor. Minimal lighting was a great ‘bang for the buck’ adding texture and color to the floor and ceiling. Room enhancements reflected the new corporate colors, and the dramatic black and red made minimal décor in the room pop. Without a budget for big name entertainment a local jazz trio was just the trick to liven up the room.” Photos courtesy of Corinthian Events

Entertainment

Unplugged entertainment. On the entertainment front, attendees can easily be enthralled by the presence of a big-name act, and not realize (or mind) that they are experiencing a “stripped-down” version of the performance. “For large-scale name act entertainment, the biggest part of that expense besides the act itself is fulfilling their rider requirements and all the staging that goes with a name musical performance,” Krizan-Ruth explained. She suggested that a planner try to contract for an “unplugged” performance, one with less staging and lighting effects, without the backup band, and so forth. “It’s an elegant, low-key approach, but it’s also the draw of ‘Look who’s performing,’?” she said. “And the cost-cutting is not insubstantial: You could save as much as $30,000 on a name act, for example.”

Negotiate a flat fee. Negotiating with the entertainer for a flat fee is also advisable, as travel-related expenses can quickly add up. Furthermore, comedians tend to be less pricey than musical or theatrical acts, especially when bands or troupes are involved, but that’s not to say it’s economical to fly in Jay Leno.

Dance bands. If a big-name act is out of the price range entirely, another approach is to hire a lesser-known act with surefire entertainment value, such as a high-powered dance band. And one that is local to the destination will always be more affordable. “I’m surprised how many planners will actually travel their favorite dance band to different locations,” said Krizan-Ruth.

Locally sourced entertainment. In fact, one of the (relatively few) cost savings that comes with a first-tier city such as New York, Chicago and Las Vegas is that there is plenty of great entertainment on hand. “In Boston, for instance, we have available a variety of historical entertainment groups, local actors and dance companies,” remarked Catherine Chaulet, CMP, senior vice president of Best of Boston. “It is a wonderful way of entertaining the group at a very fair price, instead of having acts like Cirque du Soleil fly in, which is a significant expense.”

Scaleable bands. And just like big-name musical acts, the average band or troupe will be “scaleable.” “Most of these bands are expandable or contractible: You can have 12 members or you can have four members. That’s a great cost savings because you’re paying per person really,” said Krizan-Ruth. “But if you’re already doing a scaled-down version of a band, I know many groups who are switching to a disc jockey. You’d think a disc jockey is just somebody playing the music, but many of them have

Corporate groups can mingle with style in museums such as the Asian Art Museum in San Francisco, CA, which accommodates up to 1,200 for receptions or up to 400 for seated dinners. Photo by Robert Ellis Photography

choreographed light shows. It really creates an engaging dance floor experience, and of course it’s much less expensive than the dance band. So you don’t have to lose the experience altogether.”

Guaranteed to please. Another approach is to concentrate the entertainment budget on one high-quality act, perhaps to cap the program. It’s especially important in that case to choose an act that will be a hit with attendees. Here, an in-house planner’s familiarity with a group’s tastes, based on feedback from prior events and personal acquaintances, is a real advantage, sometimes obviating a poll of who the group might like to see. “As a whole our clients who are responsible for planning these events have a very good rapport with their attendee base and understand their internal demographics very well,” observed Krizan-Ruth. “Where I’ve seen people fall flat has been in a customer-facing capacity where they were more interested in pushing their own tastes and who they wanted to see perform. So they were just less focused on who their audience is.” And if a planner doesn’t have a good idea of the demographics of the customer base, company salespeople can be a good resource.

Surprise factor. Whatever the final choice in “headlining” entertainment for a meeting, there’s something to be said for the surprise factor. “One of our clients makes a big deal of keeping it a secret because the attendees keep trying to guess if they can pull it out of them,” Krizan-Ruth said. “They’re not spending a great amount of money on the entertainment, but it’s a fun way to build excitement about who the attendees are going to see this year.”

Consider trade-offs. As with any facet of event budgeting, trade-offs are involved: More can be spent on entertainment and less on the venue and décor, for example, or vice versa. Venue expenses also can be avoided altogether. Just as many large companies are now holding meetings in their corporate offices, special events such as award celebrations are sometimes relegated to company auditoriums and even cafeterias.

More negotiating room. Still, it’s worth bearing in mind that the current buyer’s market extends to all kinds of group venues, not just hotels. “I don’t think there has ever been in my 20 years in this industry a more negotiable environment, and if folks are not at contract yet they can really work some fantastic deals with venue properties,” said Krizan-Ruth. “Any venue that is vying for event dollars is in the same boat that all the other venues are. Popularity is going to vary, so some venues will be more flexible than others, but if

Pattern lighting helped to transform Boston’s historic Old South Meeting House into a hip atmosphere for a world renowned graphic animation company event. Said event organizer Mary Coch of Corinthian Events: “Lighting, décor and dining in pews set the tone for the night as waitresses dressed in trendy black dresses wore old-fashioned powdered wigs. A highlight of the evening was a NYC celebrity DJ spinning tunes from the pulpit.” Photo courtesy of Corinthian Events

they have ever been flexible, it is now. And it’s not just going on with venues, but also with caterers, staging crews and other suppliers. So if a group wants to cut costs but not lose the experience, the first place I would start is with negotiating. This is not a time to hide your budget dollars, it’s a time to say, ‘This is what I have to spend’ and be very candid about it.”

Transportation And Decor

Staying put. Staging special events near the hotel or even onsite is of course an immediate savings in transportation costs, one that groups are increasingly opting for, Chaulet has noted. “They’re looking at hotels where they can entertain their groups as well. Chances are the hotel has a room that can easily be updated with some décor and then the entertainment falls into place. With very short money you can impress attendees,” she explained.

Built-in décor. A contrasting strategy is to use a venue that requires little in the way of décor or theming, such as a nightclub, museum or historic building. As Robin Reuben, CMP, senior meeting planner with San Francisco, CA-based McKesson Corporation, affirmed, “It’s nice when you book a venue that doesn’t need much in the way of décor; that always helps with the cost.”

While this cost-saver is a bit of an old saw in the planner’s trade, it has taken on more significance in today’s economy, and Reuben has proven its validity time and again. Her “track record” includes staging a dinner event at the Monterey Bay Aquarium by just adding tables, chairs and linens; an after-awards party at Tao nightclub in Las Vegas, sans additional décor; a dinner at Nashville’s Wildhorse Saloon, which supplied everything including buffet décor; and a reception at the futuristic Ghostbar in Dallas, where the group merely supplied a DVD to run on the monitors. Art galleries are also popular venues that clearly come equipped with their own “theme,” although typically these are suited to groups of fewer than 200 guests. And then there are venues that may need some décor, but tend to carry lower rental fees, such as medical facilities, universities and town halls.

Linens and things. When Reuben has needed to supply linens for an event space, she’s often ordered them directly from a vendor such as BBJ Linen or The Cloth Connection “as opposed to obtaining them through a DMC, for example. You cut out some of the cost and they send it right to the site,” she explained. And for a quick and affordable theme element, Krizan-Ruth recommends fabric backdrops that hang over the walls, which can transform an entire room into a rainforest environment, for example.

Lighting washes and gobos. Light­ing is another convenient means to add visual appeal to a space. “You can fill a space on a far larger scale with lighting washes than you can with foliage or draperies,” said Krizan-Ruth. And lighting projection affords plenty of creative, budget-friendly options: For example, gobos (plates with patterns cut into them that fit between the lamp and lens) allow corporate logos and branding messages to be projected throughout the room. “You’re going to spend for a lighting director, but if you’re talking about a large space it’s still much more cost-effective than the hard elements that go into the décor,” said Krizan-Ruth, adding that while a hotel ballroom will typically not have an appropriate lighting system in place, a club venue will.

Food & Beverage

Caterers deliver. One area where cost-cutting is a more delicate matter is F&B, as the quality of the food is nearly always a point of comment by attendees, whether praise or criticism. They may not care whether the centerpieces are candles, flowers or customized ice sculptures, but they will surely have an issue if their steak is tough or the portions are too small. Fortunately, caterers can be an ally in helping a planner come in under budget while delivering dishes that satisfy attendees. “If you say, ‘I need to have a three-course meal with salad, a beef and a fish and a dessert, and I can only pay $50 per person,’ they’re going to come up with something for you,” said Garforth.

BYOD. A major route to F&B savings for many corporations nowadays is letting attendees buy more of their alcoholic drinks, where heavy costs tend to accrue. Garforth has typically seen one or two drink tickets offered per attendee, “and then it’s a cash bar. I haven’t seen an open bar in probably six months, although the incentive trips still have open bars.”

Middle shelf. Garforth noted that in some cases planners can get by with serving less than top-shelf liquor. “Do you have to be serving the best vodka, or can you go middle of the road?” she said. “Most hotels and venues can use three different levels of alcohol, and you just need to know your group’s tastes.”

Mostly Business

Scheduling fewer special events and group diversions at meetings is not just about cost savings. It can also mean a greater focus on business content. Such a move will not necessarily disappoint participants, given their current concerns. “It’s great to have a comedian come up and do his little stint for the final-night awards event, but many firms are instead trying to gear their speaker toward the overall message of the meeting,” Garforth explained. In the past, attendees surely looked forward to entertainment, nice meals and perhaps a few gifts. And to some extent they still do. But with the challenges widely faced to keep companies afloat and keep jobs, “the expectation is going to be, ‘What am I going to gain from this event? What knowledge can I bring back to the field and apply on a daily basis to improve myself and my company?’?” Garforth pointed out. So while meetings that are “strictly business” tend to wear out participants, those that are “mostly business” should reflect their mindsets fairly well.    C&IT