Virtual events might seem like a money-saving option (and the only option for some due to the COVID-19 pandemic), but they can end up costing almost as much as IRL events. That’s because even though you’re doing some subtraction like zero florals and rentals, you’re also adding on line items such as hosting platforms.
“In the past, planners had to account for venue, food and beverage, entertainment, and exhibitor services,” says Kimberly Schmitz, vice president of client services and delivery for Impact Point Group (IPG). “Now, we have to account not just for the same amount of time but virtual platforms and increased customer acquisition and engagement. What we have learned and seen is that although there are some cost savings, such as F&B, venue, travel and hotel for speakers, exhibitions, etc., the cost in time for design, planning, acquisition, and execution doesn't reduce,” she explains.
So how do you break down and calculate the cost of a virtual event? Like in-person events, the event goals and objectives will determine the budget, including where you allocate the money.
Aja Bradley-Kemp, founder and chief experience officer of Conversate Collective, recommends that first-time virtual event planners use the same budget template from their IRL events as a starting point. “Eighty percent of what you did for your in-person event will translate to a virtual event environment,” she explains. And “depending on the length, format, and audience reach of your virtual event, the costs associated with your technology platform could cost almost as much as a traditional venue rental.”
Schmitz, who has worked with clients like Comcast Business, says that planners tend to miscalculate the cost of a platform as well as its capabilities. “Because it's new to most, we see severe underestimating of virtual event platforms. Many may assume their meetings platform will work, but realize the format and experience is not going to cut it. There are some inexpensive webinar and event platforms out there that will do the trick but larger-scale events need a larger budget.”
Bradley-Kemp echoes this sentiment, saying that “you need more than a Zoom account to create a virtual event that delivers value.” Adding that, “depending on the size of your event and goals, you can spend as little as $1,000 or as much as $100,000 to create the right virtual environment for your content. In some cases, you will need to utilize multiple platforms and software to achieve your desired experience.”
Creating and distributing compelling content to promote the event. You also need to consider if you will pre-record any of your content or if it will all be produced live.
Bradley-Kemp believes gifts for a virtual event must be more intentional and purposeful than before. The role of swag now is to support the content and engagement goals of your virtual event. It's more than a “thank you." In addition to sharing the items socially, you want your attendees to use the gifts during the event and hopefully after.
Plan to incur express shipping costs to ensure your attendees get their swag before the event starts.
It is easy to think a virtual event will require a lot less people than a physical event or can be executed quicker. For a virtual event to go smoothly it will require many hands. You will also need to invest time in working with your technology vendor to not only customize your digital venue but also to train your team to operate in this new environment.
Schmitz also cautions against underestimating the amount of time it takes to plan a virtual event. Because, after all, time is money. “Many make the mistake or assumption that because it's virtual, it takes less time to plan and execute. This isn't the case. There may not be site visits, but the strategizing, planning, managing, and executing are still the same, especially with the larger events.”
Although the addition of technology can gobble up a virtual event budget, overall, the event should cost less than an in-person event, Bradley-Kemp says, adding that a 20 percent savings is a good benchmark. Schmitz says that IPG is “seeing a reduction on average about 10 percent. But both industry pros stress that the target spend ultimately depends on the type of event and its goals and objectives.
So just like an in-person event, you’ll need to map out an accurate and thorough budget for your virtual event, taking into consideration these new expenses in order to get the most bang for your buck.