Today’s article is written by Axial’s Event Manager Kristen Steagall and marks the final installment in our three-part series on conferences, including articles on how to maximize value and effectiveness at events.
Conferences use a large amount of our most valuable resources: time and money. And without clear metrics, it can be hard to identify the value created by our use of those resources at conferences. But by clearly tracking the ROI on each conference, deciding whether or not to attend is no longer a guessing game. Rather, it becomes a decision based on historical performance and projected return.
At Axial we take auditing the resources spent at conferences very seriously. Over the past year we have developed several tracking systems and equations to help us determine the ROI of every conference and networking event we attend. As we prepare for M&A East next week, we wanted to share a few of the most indicative measurements we use.
Understand the True Costs:
When estimating the true cost of a conference, it is important to consider all direct and indirect expenses. In addition to the cost of registration and sponsorship (if applicable), we also consider the opportunity cost of preparation time. In order to track this cost, we start by looking at the historical number of hours it took to prepare for a conference of comparable size. For example, we know that it took our events team a combined 30 hours to prepare for the ACG InterGrowth Conference in Orlando, but only two hours to prepare for a local networking reception.
Knowing the number of hours we need to place against a particular conference helps us in two ways. First, we can better gauge if the conference is currently worth our time or if the hours are better served elsewhere. Second, if we place a dollar value against our hours worked (based on compensation and output), and multiply it by the number used in preparation, we can attribute a real cost to preparation.
By aggregating the tangible costs of registration with the opportunity costs of conference preparation, we come to an estimate of the true cost of the event.
Registration costs + [Sponsorship costs] + Travel costs + Opportunity cost of preparation (# hrs * value of hours) = True Cost
Note: You may have noticed that out of office opportunity costs are not included in the above equation. At Axial, we do not include these opportunity costs in the equation because we feel that in-person interactions at a conference can be just as — if not more — valuable than in-office conversations.
Carefully Measure On-site Effectiveness:
To measure the success of a conference, we keep track of every meeting held during the conference, whether they were scheduled or spontaneous. We also make special note if the meetings were with new contacts.
We then compare the actual number of meetings held with the estimated number, which identifies the conversion rate of scheduled-to-held meetings. This metric helps tighten up the booking process with each additional conference, ensuring our pre-conference efforts are not wasted. Additionally, by tracking these meetings in a CRM, we can determine whether scheduled or spontaneous interactions return greater yields. Whether it is new contacts, new deals, or NDAs, it is important to have some predetermined measure of success to identify the returns.
Finally, tracking meeting lifecycles allows us to understand the average number of meetings it takes to bring one new member onto the Axial network or achieve a similar success. It may seem like a lot of work to track these meetings, but the insight you’ll gain into conference performance is incredibly powerful. For example, Steve Connor of Hamilton Robinson Capital Partners recently explained that he learned it takes roughly 9 interactions to build a solid relationship with another deal professional.
A couple of the equations we use:
# contacted / # of meetings scheduled = outreach effectiveness
# total meetings held / # successful meetings = meeting effectiveness
Estimate the Generated Value:
To estimate the generated value of your conference attendance, it is important to attribute some financial value to your desired success (it can be as tangible as a signed NDA or as intangible as creating a solid relationship). For example, work backwards from the number of NDAs it generally takes to close a deal, to assign a dollar value to that NDA. Or sometimes it’s as the money generated from a sale.
Multiply the value you determined by the number of times you reached your defined success metric to get an estimate of the value you generated at the conference. From here determining ROI is simple. Just take the aggregated value generated, subtract the true cost of attending a conference and divide it by that cost. Then set ROI goals for each conference that you attend.
(Estimate of generated value – total conference cost) / total conference cost = ROI
By tracking data such as number of meetings held, how many times you achieved your success metric, or the number of new contacts you gained for each conference, you will soon have the historical data to inform your future conference decisions. You will have a better understanding of the number of meetings you need to book, the types of attendees you need to meet with, and whether or not you should even attend the conference. Finally, it’s a way to hold the company’s employees– and yourself– accountable for the time spent away from the office.