Any event producer will tell you that exacting a live event budget is a headache. Doing it well is so important to your success yet it will invariably be an expensive process of trial-and-error until you manage to really get the reins on your operation costs.
In our recent State of Live industry report, we wanted to get a read on how event budgets are shifting and changing year-on-year. The good news is that 54.3% of North American music festival budgets increased in the past year, showing that the industry is still enjoying the kind of growth that has propelled the festival boom of late.
Need live event budgeting tips?
Given that budgeting isn’t a subject that is widely discussed in the industry press, we took the opportunity in our anonymous survey of event producers to ask how they are spending their money and where they will be looking to invest in the coming year.
Who are the organizers we spoke to?
While we surveyed organizers from a wide berth of live event verticals around the world, two-thirds of our sample produced music festivals. 56% of those surveyed stages events in North America, 21% in Europe and 16% in Latin and Central America.
Almost half of event producers surveyed are operating with a live event budget of $1 million or more, with the majority landing in the $2-5 million range.
Live Event Budgets Are Going Up!
92% of event producers also reported that their overall live event budgets had either increased or stayed the same as last year. This indicates that despite increased competition and talk of over-saturation, there continues to move on a steep growth trend across the live event industry.
We spotted a positive trend towards increasing talent budgets which correlates nicely with our data indicating that audiences are drawn in largely by bookings.
So while it might be tempting to save money or cut costs on talent, our data strongly advises against it. 61.1% of fans surveyed said that “better lineups” would make them attend more events, and while “better” is an entirely subjective variable, the takeaway should be that talent budgets are central to an event’s success.
Not Enough Event Marketers Know Their Cost-Per-Customer
You should doing as little guesswork as humanly possible when trying to carve out your budget, particularly when you are running a major, potentially multi-million dollar event.
That’s why we found it pretty shocking that 41% of event producers that we surveyed had no idea what their cost per customer is.
The fact is, you can’t make intelligent decisions around your marketing spend until you have a strong grasp on how effective each channel is.
Of course the base formula for this is extremely simple (total marketing budget divided by tickets sold), but you can also get really granular in your analysis by isolating individual channels (e.g. Facebook ad, email, banner ads etc.), and tracking how many registrations resulted from each in order to better optimize your spend.
But at the very, very least you should be aware of what a customer costs to acquire when you are working on your budget