The pros and cons of hiring an outside event planner
Raise your hand if you’ve showed up at a venue and the seating was all wrong. Or you couldn’t find an extension cord for the projector. Or (insert your hassle here). Anyone who’s sponsored an event can tell one story after another – filled with colorful, if unprintable, language.
Should you staff up in-house to handle all the events on your calendar in the months ahead? Should you go outside to a contractor or a full service agency? Refill that cup of coffee and let’s talk about the pros and cons of each approach.
Consider the economics
Staffing and maintaining an in-house function (even if it is a party of one) may well be the most cost-effective approach. Some questions to ask:
- How many events do you expect to conduct annually? Will they increase in number or scope in the next few years?
- How many people attend these events, on average? It is one thing to run ten 20-person events and quite another to hold 20 events that attract 500 attendees.
- Are these events at company headquarters or at least nearby? Or are they destination events like rah-rah sales meetings that reward top rainmakers in resort settings?
“Many sponsors are concerned about employee headcount these days and don’t want to spend money on payroll, benefits or other overhead,” says Elizabeth Rolapp of Vantage Marketing, Inc. She should know, having spent several years on the corporate side before setting off on her own as an independent consultant.
“The other factor to consider is seasonality,” she says. “You probably don’t want full-time people on staff unless they’ll be busy all the time.”
You may find that it’s more cost-effective to hire a consultant or outside agency on an hourly-rate basis or for a flat fee per event. That way, you don’t incur the ongoing labor and overhead cost of staffing. “You just build the cost of an outside firm or consultant into your event budget,” Rolapp says.
As you consider the economics involved, bear in mind that top-notch event planners typically charge between $150 and $200 per hour, sometimes even more. “If you have enough work to keep a contractor busy 50 hours a week, that can add up quickly,” she says.
In contrast, the going rate for an experienced in-house event planner, according to Rolapp, runs $110,000 to $150,000 per year. Typically, benefits and other overhead add 30 percent to direct salary costs. “When you run the numbers, you find that in most cases – except for large companies with many events – contracting is more cost-effective.”
Another common option is to make event planning and execution part of someone’s overall job description. This can hold down costs and may be appropriate for organizations that hold occasional events, such as a one-time product launch or a small off-site meeting. Keep in mind that someone who does not spend all his or her time planning events may not be able to develop the strategic or logistic skills you need to pull off a big event.
Take “inside information” into account
You might run the numbers through a spreadsheet and find that it’s more cost-effective to seek outside help for your next event. But there’s more to making the right choice than counting beans.
An outsider may not have the “institutional knowledge” an insider could bring to the party. Examples range from a deeper understanding of the corporate culture to the right messaging around a new product launch. An inside person, unless very new to the company, is also more likely to have a feeling for the level of expectations among event attendees.
As Rolapp puts it, “An insider can make sure things are exactly as they should be.” And that can be particularly important for an event close to corporate headquarters. “You never know when senior execs might decide to drop by,” she says.
The stakes may not be as high if you are running a small field sales event in Mount Ayr, Iowa. An outsider’s faux pas there won’t have nearly as much visibility. But from strategic and branding issues all the way down to the CEO’s food preferences, an inside person invariably has a leg up.
Of course, a top-notch independent consultant or planning firm should be able to get up to speed quickly. It’s part of their job. But if there’s a different cast of characters for each event you’re running, some will get it, some won’t – and you’ll certainly have to repeat the process every time. That leads to the next point.
Consider a blended model
Some organizations find the best of both worlds. They use an approach that gets in-house staff working closely with an outside firm that’s “close to the action and integrated with the client company” as Rolapp puts it.
Some companies want to “partner” with experienced planners, getting them involved in developing the top-level strategy or even participating in budget development. “They may have in-house staff that’s less experienced but more than capable of handling the tactical or logistics piece,” she says.
The blended approach works particularly well when you have a lot going on. Even then, you may need to call for reinforcements when you have a major destination event in the offing. That’s a situation in which you should opt for a full-service outside agency capable of handling travel arrangements, hotels, and events for spouses and such. “A big destination event like a sales conference is beyond the capability and scope of most in-house operations or small contractors,” Rolapp says.
What to look for…
You can find listings for full-service agencies at websites like meetingplanners.com or exhibitormag.com. But independent contractors – the good ones at least – rarely, if ever, need to advertise. Their business typically comes through referrals or word-of-mouth. Rolapp admits that “In California and New York, it’s a well-known, well-defined and tight-knit group.”
Your best bet: Get recommendations from friendly competitors or others who run the kind of events you do. When you find an independent consultant or firm to work with, check references carefully (obvious but often short-changed), and make sure they are:
- Good at multitasking. “You have to be fast on your feet and have a sense of urgency,” Rolapp says.
- Honest and forthright about what they do well and, perhaps more important, what they may lack in skills or experience.
- Responsive. “You have a million people to answer to, ranging from strategic questions to ‘where do I get my badge?’ or ‘the projector isn’t working,'” she says. You need someone who will have the answers – or knows where to get them.
As mentioned already, top talent doesn’t come cheap. But the good news is that there is generally room to negotiate on fees. Costs vary with the experience of the individual contractor or firm and the geographic location. Los Angeles, San Francisco, and New York cost more, of course, than Kansas City or Denver.
… And what to watch out for
It’s easy to overspend, buying experience and mental horsepower you don’t need. As Rolapp puts it, “I wouldn’t spend $150 per hour for someone if all I need is help with logistics. You can hire a temp if all you need is an extra pair of hands.”
On the other side of the coin, while $200 per hour sounds like a lot of money, compared to what you’d pay a staff person, it is reasonable when you consider that contractors pay their own overheads, insurance, taxes and the like.
Perhaps even more important than money, when you have a higher-level event, is the ability to hand the ball to someone who can run with it. That way, you’re not the one agonizing over all the details and losing sleep over whether the seating arrangements will be correct when you get there.