Before the coronavirus pandemic hit, the events industry was worth more than $1 trillion globally. Now, the value of the market has been slashed, at least in the short term.
Precautionary measures to slow the spread of COVID-19 have confined billions to their homes and venues around the world have been banned from opening their doors.
In this case, it’s not just national lockdowns which are to blame. It’s the cancellation of international flights which has killed tourism for the time being.
The pandemic is having a negative impact on the vast majority of industries.
Only those which don’t require the physical presence of customers, such as gaming, home fitness and online learning, are doing well.
Alongside commercial aviation, the events & hospitality industry has been one of the worst hit. With no customers to buy tickets or attend events, and venues already booked months in advance, event organizers are facing one of their worst-case scenarios.
To put into perspective how big an impact the current situation could have on the industry, just look at some of the figures.
A survey conducted by C&IT revealed:
On top of this, 69% of survey respondents said that their events were not covered by insurance. In Italy, hotel occupancy rates for the week ending March 21st were down almost 96% compared to last year.
Meanwhile, Intercontinental Hotels Group reported a 67.5% drop in occupancy for the last week of March.
Event organizers have been left with most of their prior financial obligations, but their revenue stream from ticket sales has dried up completely. To make matters worse, many customers are also now claiming refunds, stretching cash reserves even further.
At the moment, the outlook for events & hospitality is rocky. But, there are a number of options which could help ease the pressure.
The main decision event organizers face is whether to cancel or simply postpone upcoming events. Postponing means events can simply be rescheduled later in the year when restrictions may have been at least partially lifted, but there’s no guarantee anything will have changed. So far, the highest profile event to be postponed is the 2020 European Football Championship, which will now take place next summer.
Cancellations are a bit more tricky and, without insurance, a lot more expensive. There’s also the logistics of providing refunds to thousands of customers.
Coupons are an unconventional but effective way to balance the need for cash with the obligation to provide refunds. Instead of receiving a full refund, customers can instead receive a coupon or gift card for 110-120% of the value of their original ticket. This way there’s an added incentive for holding off on a cash refund.
Hotels, on the other hand, could offer discounts now for stays booked later in the year. They could even offer special discounts for local residents to encourage people to try a staycation. Now that most people are confined to their houses, even staying in a local hotel could be a welcome break.
Check out creative promotion ideas for a country in lockdown for more suggestions.
It’s the quarantine and lockdown measures that have had by far the biggest negative impact on most businesses. Because millions of people are now working from home, video conferencing platforms have seen a huge spike in demand.
Many event organizers are making use of this popular new medium to offer their customers a new event experience during lockdown. Digital events were around before the pandemic, but they’re now the most viable alternative to the real thing we have.
There are many ways promoters can encourage customers to sign up to and attend virtual events, whether they’re business conferences or ‘live’ music events. Promotional solutions, like voucher codes or even friend referrals, are a great way to encourage new attendees. As long as the event is compelling and relevant, a little bit of promotion targeting could be all it takes to secure new customers.
Incentivizing customers to stay tuned despite the crisis is crucial to business. Having a well-thought-out loyalty program in place will help. For example, give your users points or special membership benefits/access for each event they sign up to. You can learn more about improving customer loyalty and retention with this link.
Be creative and find new ways to engage with your audience. Incentivizing customer behaviour can help you stay afloat in tough times. Talon.One’s Promotion Engine, the logic behind your incentives, will allow you to set up and run any promotion campaign you want.
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