Effective by Design

Defining tactics: ROI is a measurement method, says Planning House International’s Brooke Selby, CMP, but ROO is a whole paradigm for putting on a meeting.

The event was supposed to be relatively cut-and-dried. David Buck, CEO of Zweave, an apparel industry software company based in Boston, was putting on a client meeting to introduce his software to major uniform buyers. He came across an e-mail from an old associate, Michelle Hartley Jackson, CMP, with whom he had worked in the ’90s. She and Brooke Selby, CMP, had recently left IDG World Expo in Framingham, Mass., and founded a new company, Cambridge, Mass.-based Planning House International. It seemed they could advise him on marketing his event.

The final goal: Ultimately, an event should result in profits, stresses Michelle Hartley Jackson, CMP, of Planning House International.

    In their first meeting, Jackson and Selby asked him questions that would change the event’s course and eventually make it a success.
    “They began the process by asking, ‘What do you want to get out of this? Why are you doing this? What are your objectives?’” recounts Buck. “They got me to take a step back and think about the event a little differently.”
    These kinds of questions make up the cornerstone of “return on objective,” a relatively new way of assessing the value of a meeting. Traditionally, meetings have fallen outside the scope of measurement and therefore have represented a sort of black hole for corporations, an arena most everybody knows is necessary but few can prove precisely why. Recently, however, as procurement departments have begun to dip their fingers into the meetings pot, meetings professionals have been faced with convincing stakeholders their conferences are worth the cost. The creators of PHI know how to prove it.
    “Most companies look at the meeting or event division as a cost center,” says Jackson. “We believe that meetings and events should be looked as a value center.”

ROO’s emergence
For years, sales departments have measured return on investment by tallying dollars received against dollars spent. The influence of marketing, however, doesn’t necessarily translate dollar-for-dollar into a company’s revenue.
    Instead of calculating success based on revenues, marketers typically measure returns based on whether their objectives, from brand awareness to customer relationship-building, are met. Completion of these objectives, rather than dollars earned, ultimately determines the success of a given campaign.
    A decade ago, the first mentions of return on objective were heard in the trade show world, thanks in large part to Skip Cox, president and COO of Exhibitor Surveys, a trade show consulting firm in Red Bank, N.J. Cox saw that exhibitors could measure the value from a show if they delineated clear objectives from the get-go and took stock of their progress at multiple points before, during and after. He called this ROO.
    In the past few years, because of a pandemic of cost-cutting, ROO as a trade show tool has taken off. Says Cox, “It’s in everything, in every place you look. The mantra is ‘measure every aspect of your business or lose it.’ And I don’t think that’s going to go away.”
    In addition, the headlining accounting scandals and the Sarbanes-Oxley Act have brought such a scrutiny of expenses that the procurement departments of many corporations are training a critical eye toward meetings, that elusive bastion of soft returns. Now, planners are using ROO to prove their meetings matter.
    Some suppliers are supporting the effort, too. Barbara Talbott, vice president of marketing for Four Seasons Hotels and Resorts, based in Toronto, says a growing number of clients have expressed a need for ROO measurements in the past 18 months. “They obviously still have the responsibility to deliver a flawless event and manage their budget,” she says. “But now, the planner is being asked to develop a business case for the meeting.”

CASE STUDY: ENERGY EFFICIENCY

Dallas-based Meeting Professionals International is sponsoring a course with the Birmingham, Ala.-based ROI Institute to teach return-on-investment methods to meeting planners. The ROI methodology is based on defining objectives from the outset. In that way, it’s quite similar to return on objective; however, MPI’s approach might be more complex than most planners are willing to take on.
    Now the association is compiling a series of case studies from planners who have completed the course. Perhaps the first example comes courtesy of Marge Anderson, above, associate director at the Energy Center of Wisconsin, in Madison, a nonprofit dedicated to increasing energy efficiency in the outside world.
    The meeting’s goal was to educate home builders on energy-efficient construction techniques. After the ROI training, Anderson introduced the idea of measurement to her company’s executives and the meeting’s sponsors, and they loved it. “They said, ‘It’d be great if you could tell us the returns, but we don’t believe you can do it,’” Anderson says.
    Her objective was to get homes built using energy-efficient technology. This would be expressed as kilowatt-hours saved, the company’s measure of success.
    Using surveys and interviews, she collected data on customer satisfaction, learning, the changes the builders made and the business results of those changes. She handed out “smile sheets” (satisfaction surveys) at the end of the conference to attendees, exhibitors and presenters. Attendees also received a survey after each session.
    A few months after the event, Anderson sent out Internet surveys to all attendees to determine whether the builders were applying the tools they learned. She also interviewed a random sample in person, to bolster the Internet data. “A lot of our builders wouldn’t know a computer if it hit them on the head,” she jokes.
    Next will come the analysis and report phases, in which the company’s analysts convert all the statistics into dollar amounts to determine an ROI value. Part of that is careful compilation of labor and expenses for the conference. She’ll show the report to the meeting’s sponsors to convince them to fund it for another year.
    Anderson advises cautious planners to take it slow. “MPI would like people to take at least the next step in measurement,” she says. “It’s kind of like eating an elephant. You do it one bite at a time.” -- J.V.

Dollars vs. sense
In recent history, the business world has been assaulted with ROI, ROO and other acronyms even ROR (return on relationships) and ROS (return on smiles). To complicate things further, a term as common as ROI means something slightly different to different people, which means planners have created their own way of focusing on returns, whether formally or informally stated.
    “There are few, if any, industry standards and, sadly, very little experience in the sharing of best practices,” complains Peter Hanley, president of the McLean, Va.-based PlanNet. Hanley doesn’t use acronyms but instead focuses on what they promise: generating profits by honing in on the meeting’s objectives.
    The difference between ROO and the most recent ROI models might just be a matter of semantics. For example, a new ROI initiative being promulgated by Dallas-based Meeting Professionals International (see box at left) shares many attributes with Planning House International’s ROO. Both require any gains made to be based on objectives laid down at the outset, and both call for intensive strategic planning to keep the meeting in line with the objectives.
    “There is a major gap between what we have considered ROI in the past and the methodology we are now promoting,” says Doug McPhee, CMP, national account manager at Conferon Global Services in Cardiff, Calif. McPhee is among the first to take and graduate from MPI’s course, taught by the ROI Institute, based in Birmingham, Ala.
    According to Michelle Jackson and Brooke Selby, though, the two techniques are completely different. They say ROI is a measurement method, whereas ROO is a whole paradigm for putting on a meeting.
Clearly, the semantics can be debated. However, the unique concept behind ROO is that it doesn’t have to end in a dollar figure. ROO benefits planners who don’t have the resources to implement a complicated ROI model, who simply want to improve their meetings.

Many happy returns
When the women of Planning House International met David Buck of Zweave about his client event, they realized they’d be doing a lot more than a little consulting work. “He thought he would go in with a fairly traditional approach and hope for interactions with decision-makers,” says Selby. “He thought it would take maybe a dozen hours to pull the whole thing together, start to finish.”
    Jackson and Selby performed a needs assessment on the meeting. The objective was to sell Buck’s product, which would require getting executives in the door and teaching them about a rather complicated and expensive piece of software. “Getting people from the industry into the room wasn’t going to achieve the objective,” says Buck. “I needed senior-level people, the decision-makers.”
    They went back to the invitation list Buck had purchased and researched who would be able to sign off on his product. Jackson and Selby dug around to find other qualified invitees, as well.
    They distilled the enormous list into a small but potent collection of C-level executives. Planning House International organized a marketing campaign to draw registrants and then leveraged the cachet of those who had signed up to convince even more to attend.
    At this point, Jackson and Selby put on the traditional meeting planner’s hat, as well. Because the meeting would be much smaller than Buck had previously thought, they had to work with the hotel to shrink the size of the event.
    “I had wanted to do something quick,” says Buck. “I wanted to get it off my checklist, but Michelle and Brooke told me to slow down a little bit.”
In the end, it took about four times as long and a substantial amount of resources to refine the event, but the extra effort paid off. Thanks to the road show, Buck is close to signing multiple clients, including one very large, high-profile organization.

How ROO works
Here’s how anyone can create a return on objective program for their meeting.
    1. Talk with stakeholders. Learn from the company’s executives what they would like to see the meeting achieve. “Many times the client hasn’t come together [internally] to define what success looks like,” says Kim Streeter, senior director of account management and operations for Minneapolis-based Carlson Marketing Group.
    2. Define your objectives. Translate stakeholders’ goals into a few succinct objectives. Keep in mind the following.
    " Make sure the objectives you set can be easily measured. “Increasing brand awareness” isn’t as measurable an objective as, say, “making one-third of a product’s target audience aware of the brand.”
Pinning a dollar figure on marketing objectives is difficult but possible. For example, press coverage can be measured in inches or words; to tabulate its value, Candace Adams, CMM, CMP, president of Trade Show Consulting in Vista, Calif., figures it’s twice as valuable as advertising and doubles the publication’s ad price per inch.
    " Don’t set objectives that measure the success of the meeting planning, rather than the meeting itself, Skip Cox advises. “A lot is focused on the tactical: Did they have a good time? Did you get a good rate? That’s important, but it doesn’t get at what you’re trying to accomplish.”
    " The objectives should result, somewhere down the line, in profits, says PHI’s Jackson. For example, the real objective of an incentive program is not reward or motivation; it’s reducing the costs associated with employee turnover and turning profit resulting from increased productivity.
    3. Set a value to those objectives. Here’s the tricky part that has stymied meetings departments for years. How much is, say, education or brand equity worth? Do your best to figure out what monetary returns your objectives will deliver. The more business-related your objectives are, the easier they will be to translate into dollars.
    Present this dollar figure to the stakeholders, and use it to create a budget for the meeting. Or, if the budget is already set, use it as an estimate on how substantial you predict returns will be.
    4. Match the meeting to the objectives. Every dollar spent on the meeting should help accomplish its goals. Buck’s meeting provides a perfect example.
    5. Put metrics in place. Often, the measurement techniques arise naturally from the objectives. In Buck’s meeting, he simply could count the resulting sales and factor in the clients he shepherded along the sales process.
    If the meeting was set up to reduce complaints or breaches in compliance, Jackson suggests counting how many fewer offenses occurred after the meeting, deciding how much each would cost the company and then multiplying the two to tally the savings.
    6. Count and tell. Conduct measurements, do a little number-crunching and report the results.

Helpful hints
Starting up a system of ROO in your corporation can be daunting. Here are a few tips to ease the process.
    Consider hidden costs. An ROI measure will be inaccurate unless all the costs for the meeting are included, advises Doug McPhee. Include office overhead and meeting planners’ and executives’ prorated salaries. Another cost often overlooked is the “opportunity cost” of having company members attend the meeting instead of doing their jobs.
    Be consistent. Use similar questionnaires and the same criteria for counting qualified leads and other details across events, suggests Adams.
Know the business. Barbara Talbott insists on learning as much as possible about the corporation. Meet employees outside of your department, because that will reveal any internal challenges that meetings might help overcome, and it will give you someone to turn to for help.
    Feed the budget. Make an argument for extra spending if it will help guarantee profits.
    Slow down. “Resist the urge to move right into the next project,” says Jackson. “By completing an event and moving on so quickly, planners don’t see an event through its entire life cycle.”