Editor's note: This article, provided by the Event Leadership Institute, was part of an eHandbook collaboration between Meetings Today and ELI. To download the free Budget-Saving Strategies eHandbook, click here. For additional Meetings Today eHandbooks, access: MeetingsToday.com/ebookshelf.
If you struggle with creating a realistic budget for your hybrid event, it may feel like you are looking for the elusive unicorn.
As you may know by now, there are three components to a hybrid event:
- The in-person experience
- The virtual experience
- How these two experiences come together during the hybrid event
Predicting and planning how these two experiences come together and the funding required to create a successful experience has many event professionals feeling like they are looking for that proverbial unicorn. So, let’s try to demystify and provide clarity by following a 10-step process to develop a realistic hybrid event budget.
Step 1: Start With Your Event Purpose, Vision, SMART Goals and Measurable Objectives
Every budget decision or recommendation you make should tie directly back to the event’s purpose, goals and measurable objectives. Your initial market research informs the event goals. The event personas you develop also play a role in the experiences you plan to create for your participants, in-person or virtual. Without having developed these strategic components for your event, your expenditures will not be strategic or effective, and you could be wasting money.
Step 2: Begin With the End in Mind
Do you have a net income goal? What about the total amount of event funding you cannot exceed? If you have an idea of the profits you need to make or a budget limit you need to stay at or under; this can be an excellent way to start with your budget, as these are non-negotiable data points.
Step 3: Reference Historical Data
If your event is a recurring event, even if it wasn’t a hybrid format in the past, review any past event’s actuals as a place to begin. Hopefully, you have a summary report that includes actual amounts of revenue and expense line items, participant breakdown and so on. Consider any changing market or economic conditions (e.g., supply chain disruptions, scarcity and inflation) and estimate how many participants are expected to attend virtually or in person.
Step 4: Manage Stakeholder Expectations
Once you have a general idea of the expected income and expenses, seek to gain buy-in from your stakeholders and budget approvers. At this point, the budget does not have to be perfect or completely finalized.
Instead, you’ll want to start socializing the estimated event costs with your stakeholders as a pressure check to see if what you are thinking is generally in line with their expectations or not. If it isn’t, keep developing a more accurate estimation and know where you may need to generate cost savings and alternatives.
Suppose your initial budget estimates are out of line with expectations. In that case, it’s also a good idea to begin managing your stakeholders’ vision of the event to align with what is fiscally feasible.
Step 5: Create a Line-Item Budget
Using a budget template that you can standardize across all your events, begin to draft the estimated expenses line-by-line. Indicate which expenses are in-person and which are virtual in two separate columns. You can include broad categories of costs (e.g., F&B, audiovisual, entertainment), but these broad categories should also include sub-items to avoid missing details. Use historical data here, too, especially for the in-person segment, as these items will be more familiar to you.
Then add in the estimated virtual participants and additional costs to bring the two audiences together based on your research of virtual platforms and streaming providers. Also, include any expenses exclusive to in-person or virtual participants.
Step 6: Technology and Production Considerations
The technology you use will depend on your goals and objectives for your event, content and engagement priorities, size, scope and budget, to name a few.
There are many technology solutions, and they all come with different pricing models. All-in-one platforms may be the best at integrating several functionalities and experiences. Still, you may also want to consider other tools, like mobile apps, to connect all your participants. Some hybrid event platforms also offer built-in budget management tools, which can be beneficial.
You’ll also want to start an early conversation with your selected venue’s AV or production provider to discuss the technical and logistical considerations for bringing your two audiences together. Plan to invest in additional staffing costs from the platform or production provider to create a seamless experience for your participants.
Step 7: Create a Contingency Fund
While some may consider this strategy “padding the budget,” it is a good idea to build in a bit extra, say 10%-20% of your total budget, for the unexpected. This strategy is highly beneficial to first-time events, new locations and especially with a hybrid event. Best case, you don’t spend it and you can report it as cost savings for the event. Worst case, you don’t build this in and then wish you had, especially when your AV proposal comes back much higher than anticipated or you have fewer in-person attendees than expected. It will be challenging to meet your F&B minimum and sleeping room commitment.
Step 8: Determine Your Sources of Revenue
If you plan to profit from the event and create revenue streams, these must be included as anticipated revenues and line items. This way, you can keep track of how well each stream is performing and make any adjustments.
Step 9: Seek Final Budget Approval
Once you have a total budget, create an executive-level summary and seek final budget approval. Use this as an opportunity to educate your stakeholders on the differences between the in-person and virtual experiences and point out how the various expenditures will be tied back to the event’s purpose, goals and objectives. Discuss how the budget will be monitored and what type of reporting the stakeholder would like to receive, and how frequently. Once the budget is approved, leave all figures as is, make any adjustments to your working budget, and report confirmed expenses in your actuals. Once the event is over, you’ll want to be able to refer back to the original approved budget compared to your actuals.
Step 10: Post-Event Reporting and ROI
Finally, reconcile your budget, revenue streams and expenses following the event. Then, create post-event reports, including how well the event met or achieved the stated goals, and calculate ROI. Schedule a post-event debrief and review an executive summary with your key stakeholders, lessons learned and areas of success.
Hopefully, the process of developing a thoughtful—and more importantly, accurate—hybrid event budget will be demystified by following these steps. You’ve found the elusive unicorn…let’s hope you don’t need a pot of gold!
