Cost Reduction for Live Music Events.
As most regular live music events and music festivals this year have been cancelled hopefully re-emerging in 2021 controlling ongoing fixed costs could be the key to survival. How can event organisers control costs without impacting on their overall business particularly in relation to staff and customer satisfaction.
When a large event gets cancelled some event organisers go straight into cost cutting mode with a focus on financial survival. However, organisers need to be more creative, compassionate and thoughtful about how they manage costs when revenue suddenly stops.
For music festival organisers by March this year most if their tickets had actually sold out or been very close to being sold out. This business model can work great for cash flow because they have a large proportion of the event revenue up front, however there has been some churn in refund requests although probably not as much as many organisers were expecting. Any expected revenue from sponsors and vendors has almost certainly not materialised and could leave many facing financial difficulty. Some have resorted to crowdfunding and/or taken advantage of various government initiatives to financially support them into next year.
Event organisers will hopefully have transferred any bookings made into 2021 but it is wise to maintain communication and good terms with all suppliers rather than simply cancelling everything without a further thought. Perhaps it's possible to commit to future bookings and add in a financial deposit to maintain goodwill.
The backbone of any event organising business is the staff they employ and they should be a priority in these difficult times. If possible, make staff cuts the last thing to look at when reducing costs and at all times maintain a constant dialogue informing them of any financial difficulties, equally don’t make false promises, just be honest. Look at government supported options for furloughing staff or negotiating reduction in salaries as alternatives to redundancies. Loyal staff are a key asset and when business picks up, they are not easily replaced.
Ticket buyers have generally been supportive of the live events industry and this relies on regular communication via email or other social media platforms. Have a member of the marketing team responsible for implementing a regular update and communication strategy to engage with customers.
If booking deposits are required for future events try entering into negotiations with the artist’s management team about perhaps reducing this. Everyone is aware of the impact on live performances and it may be surprising how flexible they will be.
Spend on marketing is usually the first and most obvious cost to be cut, however marketing activities can be refocused on more low-cost alternatives. Stick to social media engagement and other online tools which incur zero costs yet maintain engagement with ticket paying customers. Get the marketing team to focus on these free online tools and get them to create content for social sharing rather than advertising in the media.
All these factors will keep costs down and maintain the live event or music festival brand. The whole live music events industry is in this together and businesses should do their utmost to support each other with constant communication and sharing the cost burden where possible.
When using a live music event software management platform like FestivalPro users get all the functionality they need to understand their costs and cash flow. The guys who are responsible for this software have been in the front line of event management for many years and the features are built from that experience and are performance artists themselves. The FestivalPro platform is easy to use and has built in features that help marketing teams with social media and record contract agreements made with suppliers and performance artists.
<< Back to articles