Clients are currently favouring postponing events rather than cancellations, according to the majority of those who attended micbeook’s emergency event industry leaders’ summit on the coronavirus crisis.
A quick straw poll of 10 of the agencies in attendance revealed 38 event postponements and 25 event cancellations as a result of coronavirus, while a venue representative reported a 24% decline in enquiries. Agencies reported anything from 1 to 10 postponements and 1 to 8 cancellations.
Most of the postponements are for April/May/June but there are a couple as far ahead as October and November. Postponed and cancelled events are predominantly overseas so far, although there have been some domestic cancellations in London as well. Unsurprisingly, there has been a number of cancellations for events in Italy and Asia, but also Spain, France, South Africa and the US.
Here are some key takeaways from the discussion on postponements and cancellations:
*Agencies were warned to be careful about how optimistic they are about those postponements actually happening. Are we delaying an inevitable loss and not taking the right precautions now? Events that are being moved to later in the year may end up being postponed again or cancelled so you need to factor that into your business contingency planning.
*Availability of team/venue – if all events are being moved to September onwards, that is already one of the busiest times in the events calendar so there is no guarantee you will be able to get the same venue or even guarantee the same team for the client so you need be prepared for that, and for how you will manage workload when business picks up.
*One suggestion was to push business into 2021 instead. One agency said they took the decision with one client to postpone all events for Q1 and Q2 and renegotiate with suppliers on the client’s behalf to move it the first half of next year. The agency didn’t charge for doing this and did it as a goodwill gesture, and while they have taken a financial hit in the immediate term, they have guaranteed that work for next year.
*Some venues view postponements the same as cancellations so agencies are spending a lot of time renegotiating with venues to agree to postpone and reduce the liability.
*Agencies should try and get clients to commit to a date later in the year to move the event to and the hotel industry can help with that by putting coronavirus clauses into their contracts and reducing liability so we can get some confidence back.
*Should agencies charge clients additional fees for postponed events as a lot of the work will need to be repeated?
*Is cancellation because of the coronavirus force majeure or not? Clients and agencies need to look closely at their contracts and cancellation and insurance policies to see what they are covered for. It all depends on the individual contracts and supplier agreements. If pandemics are not named in your contract, then you may not be covered in the force majeure clause.
*If the client cancels – it is up to them to deal with whatever loss they suffer from their own insurance companies.
*One agency head said that some clients are asking the agency to waive fees. “Our position is that we can’t waive fees, and payment terms as well – we shouldn’t be relaxing those either despite pressure as we need to protect our business.”
*What happens if the government decides to cancel events over a certain size? How will that impact cancellation policies? Our law expert said that the answers are always in the contracts.
*Lots of hotels refuse to pay commission on cancelled events. If you are working on a pure venue find basis that is a huge loss of revenue. What can venue find companies do to protect themselves? Can venues and hotels support them somehow?
*Many hotels and venues are now putting in place coronavirus clauses for any new business booked. Check out the latest supplier updates here.
*Agencies need to keep talking to clients and offering alternative solutions where possible. We discussed what alternatives agencies are offering, with the most obvious options being digital solutions such as webinars, streaming and virtual events. Of the 10 agencies we polled, four had already swapped a live programme for a digital solution while others said they had clients considering alternative options.
Other alternatives that have been offered include:
*Hosting an event at a clients’ office instead of an external venue to minimise risk.
*Organising an event in small groups of 25 per office to limit exposure as opposed to bringing people from multiple offices together.
*Move overseas events to UK events. There are some good rates to be had on venues at short-notice.
*One agency has built a TV studio in its offices and is allowing clients to use that for free to record and broadcast necessary communications that would normally be communicated via an event.