The event industry is no longer unaware of the drastic effects a crisis situation can bring, especially after the pandemic era of the year 2020 and 2021. The COVID-19 phase has taught us that the circumstances can turn totally upside down, and most of us are not even prepared for that. Not only the deadly disease but also in times of natural calamities, political conflict or other widespread disruption, the event industry suffers directly.
In 2020, due to the lockdown, the average ticket price of live performance events fell from $92.89 to $87.14. The number of tickets issued to live performance events fell by 68% to under 8 million, and ticket sales profits fell by 69% to $600m in Australia. The ticket selling platforms in Australia and all over the world were totally unprepared to face such a severe change in ticket sales. The sad part is it took a long time to get things regular as the effects of the pandemic continued till the end of 2021.
It is clear that a sudden change in the system can bring a huge loss for the event industry. Thus, having a backup plan and an instant solution is a must. We simply call it risk management in the event industry. Without proper and strong event risk management, achieving long-term success will be impossible.
What is event risk management?
Event risk management is all about being prepared for the unexpected and planning to handle it confidently. It is a crucial aspect of planning any type of event, no matter if the event is big or small. It’s all about anticipating potential problems and having a plan in place to deal with them.
Think of event risk management as insurance for your event. You measure the potential risks and put arrangements in place to mitigate their impact. This way, you can focus on delivering a successful and memorable experience for your attendees instead of worrying about what could go wrong.
Why do we need it?
Most unwanted occurrences worsen because we are not prepared enough for them. Being equipped with a well-planned risk management strategy can-
- minimise financial losses,
- reduce the impact of incidents
- lessen the damage to your bottom line
- protect the reputation of your event company
Think about it in this way – wouldn’t it be great to have a backup plan for your event, just in case something goes wrong? That’s exactly what event risk management provides. It saves you from all the panicking, knowing that you have systems to deal with potential risks and keep your attendees safe.
Possible techniques to tackle the next crisis situation:
We’re never too prepared for an unseen catastrophe, but we can guess how difficult things can be from the already-seen ones, right? The disastrous scenarios suggest us to prepare for plans B, C and even after D, which is actually not a bad idea! But to build that risk management plan in an effective way, all we need to do is prepare an answer to some important questions.
Let’s dive into the questions bank and how they are going to help you in event risk management:
What are the potential risks?
Unexpected incidents can happen at any event, but the relief is that you can take steps to minimise their impact. Understanding the problem is always the key to the solution. Find possible issues that might affect your event so that you can take the essential steps. When it comes to event risk management, here are a few possible risks to look out for:
- Mother Nature’s Fury – Natural disasters like hurricanes, earthquakes, or wildfires can disrupt your event and put attendees at risk.
- Tech Troubles – Technical failures like power outages or equipment malfunctions can be frustrating for attendees and impact the overall experience.
- Sickening Scenarios – Health pandemics like COVID-19 or other flu can threaten attendees’ health and safety.
- Security Glitches – Security breaches like theft, vandalism, or acts of terrorism can put everyone in danger.
- Reputation Risks – Negative publicity or social media backlash can tarnish the image of your event.
- Financial Fallout – Cancellations, refunds, or decreased attendance can significantly impact your bottom line.
- Legal Landmines – Lawsuits, liability, or insurance claims can arise and cause serious headaches.
Also use of alcohol, including minors, for any event activity, animals, or other physical activities might cause event disruptions and increase the risk.
So, try thinking about all these risks while arranging your event and the risk management team.
What are the financial implications?
Assessing financial consequences is critical in analysing risk and preparing for any crisis situation. This involves estimating the potential costs associated with each risk and how it could impact your budget. Here are a few aspects to keep in mind when assessing financial consequences:
- Consider all possible costs – When assessing financial consequences, make sure to consider all the potential costs associated with each risk, including direct costs like cancellation and refunds along with indirect costs (e.g. lost revenue, damage to reputation).
- Give attention to the contract – Know about the different contracts before making any agreement with the partners. Try reviewing the contracts, understand and clarify beforehand who is responsible for what if any occurrences appear.
- Establish a budget – Having a budget in place before you begin analysing risks will make it easier to estimate the financial consequences of each risk and determine the impact on your event.
- Consider multiple scenarios – Consider different scenarios and how they might impact your event financially. For example, if a natural disaster occurs, what would be the cost if attendance drops?
- Use data to inform your analysis – Use data to inform your analysis and make more accurate estimates of the financial consequences of each risk. This might include market data, past event data, or industry trends.
What will you do if a risk appears?
If you have already thought of possible scenarios and checked the financial conditions, now you have to think what’s the first decision you will make regarding your event if the risk actually hits in time. Here are some possible steps that you might consider-
- Reschedule: It can possibly be the best solution when a risk hits your event. All your efforts at least don’t go in vain. The first step in rescheduling an event is to check the availability of the venue and vendors. If your date and time match the desired venue, consider yourself lucky. Otherwise, there’s no option other than choosing another date. Postponing an event might be troublesome, but you must do it if the risk is not denied.
- Alternative platform: When you find no chance of rescheduling and cancelling, it isn’t an option, try thinking about alternative platforms. For example- an online event or hybrid event. We can take the COVID-19 phase as an example. Many events successfully took place on online platforms. When things started getting a little normal, we were introduced to hybrid event types where a limited number of guests attended the events.
- Cancel: Cancelling an event is a last resort in event risk management, but it may become necessary in certain circumstances, such as a natural disaster, health pandemic, or security threat. Cancelling an event can have significant financial consequences, so it’s essential to consider these carefully before deciding. Also, be clear about the refunding conditions and procedures with attendees in case of cancelling the event.
How will you handle the attendees?
When you sell tickets for your event, you usually take communications with the audience quite strongly, but in times of danger, it is often forgotten. Remember, your attendees are your primary asset. If they face any trouble due to a lack of communication, your event management team will be on their blacklist forever. Thus, prepare action items to deal with and communicate with the attendees if any hazardous situation hampers your planned event. Few things to remember-
- Communication is key – Keeping attendees informed and updated is crucial during any changes or disruptions to the event. Ensure that you have clear and concise communication channels in place, such as email, social media, or a dedicated website. Mention the rescheduled dates, venue and other changes.
- Be transparent – Be honest with attendees about the situation and the reasons for any changes to the event. This can help build trust and minimise confusion and frustration.
- Offer options – Provide attendees with options, such as refunds or the opportunity to attend a rescheduled event. Ensure that the options are clearly communicated and that the process for making a choice is straightforward and easy to follow.
- Provide support – Offer support to attendees, particularly if they are facing difficulties or have questions. This may include a dedicated customer service team or a frequently asked questions section on the event website.
What precautions to take beforehand?
To gain the best risk management plan, all you need to do is plan ahead. None of us is aware of the future, but we all know updates about our surroundings. So, based on that, you need to make some plan ahead of time so that you are prepared for any potential risks and that you are in a position to respond effectively in the event of an unexpected situation-
- By surveying the top concerns, you can arrange for special measures. For example, extra security for crowd safety
- Invest in event technology that will save you from all the hassle. You can invest in Automating refunds in case of necessity, tracking attendee’s information etc.
- Consider purchasing event insurance, which can provide coverage for unexpected events.
- Stay informed about any developments that could impact the event, such as local weather forecasts, government regulations, or public health updates.
What went wrong in the previous event?
Evaluation is such a tool that can help you focus on your own shortcomings and gives you chances to improve them. To handle future risks, you need of idea of where your event game stands presently. The only way to solve this is by doing a post-mortem of the previous event and finding out what worked for you and what didn’t.
- Find out how the previous policies and procedures worked adequately or not.
- Check if the technical issues were solved instantly.
- Make sure your backup team serves their duty properly.
- Include any technology it was missing in the previous one.
- Check whether the communication strategy was appropriate for your event type.
In conclusion, being prepared for anything and having backup plans is the most important lesson we learned over the last few years. That’s why event risk management is a critical aspect of event planning that helps to ensure the success of your event and minimise the impact of potential disruptions.
By being proactive in your approach to risk management, you can ensure that your event runs smoothly and that your attendees have a positive experience. Whether you’re planning a big conference or a small meeting, effective event risk management is essential for the success of your event.
