fbpx
Home / News / Pandemic throttles events industry: Businesses make changes, add new initiatives to survive

Pandemic throttles events industry: Businesses make changes, add new initiatives to survive

Ashley and Andrew Tandon sporting their masks at their impromptu backyard wedding in May. (Photo courtesy of Ashley Tandon)

Ashley and Andrew Tandon sporting their masks at their impromptu backyard wedding in May. (Photo courtesy of Ashley Tandon)

Across America, event planners, event venues and hotel and conventions spaces are reeling because of the impact of the COVID-19 pandemic. As a “new normal” is set, the industry has shifted to meet the need while staying safe.

In North America alone, the events industry is a $222 billion gross domestic product industry. The North American market makes up 36% of the $1.5 trillion global events market, claiming 31% of global event direct jobs. The pandemic hit the events market hard, causing a trickle-down effect for everyone ranging from linen services to entertainers.

Whitney Tatum, president of Eventures Inc. in Oklahoma, was working to plan a luxury wedding set for September in Vail, Colorado, and everyone was hopeful that the virus that had basically shut down the world was starting to ease up.

Then cases started rising again in the U.S. in June. That luxury wedding was canceled, not by the bride and groom, but by the corporation that owned the venue in Colorado.

“Everything really started changing in April when the stay-at-home orders limited gatherings to 10 or less people,” Tatum said. “Most events postponed or switched to virtual, but even the virtual events had to be moved to a later date. It was like that until June. Then it seemed like events were moving forward again.”

Change of venue

Eventures specializes in planning Fortune 500 events, large foundation events, private social events and luxury weddings. As COVID-19 cases began rising again in June, a new wave of cancellations began.

As in-person events screeched to a halt, companies like Eventures shifted their business model as well. Virtual events became more popular, as did coaching for clients who were trying to figure out how an event could go forward.

“Honestly, doing a virtual event is not too different from producing a live show,” Tatum said. “It’s not out of our wheelhouse, but we also began coaching our clients on how to do that. For the live events that still happened, we worked with clients on issues like social distancing requirements, thermal temperature gauges and sanitation procedures.”

Not surprisingly, event space became the easiest part of event planning. While some venues ultimately went out of business, others were eager for the business.

“We as an industry need to change the mindset across the board for events,” said Tatum. “In the future, we need to hold events to a higher standard and keep those social distancing protocols and sanitation practices going for the future.”

Events shifting

This spring, the Professional Convention Management Association released its “COVID-19 Impact on Events Research: Top-line Results for Planners.”

Seven out of 10 respondents said they moved their face-to-face event partially or fully to a virtual platform, and many don’t see that as a short-term fix during the pandemic but something that will continue alongside in-person events going forward.

In fact, the coronavirus pandemic may have quashed the long-standing fear that virtual events will cannibalize future face-to-face events. Less than one-quarter said that is something they worry about; 62% said that is not a concern they share.

Nearly half of respondents said their future potential attendees will be more hesitant to travel than have a pent-up desire to meet face to face once the crisis has abated.

Some said they don’t think attendance levels will rise to their 2019 levels until there is a vaccine for COVID-19, and others said that even if there is a desire to travel to attend an event, economic realities may prevent on-site participation in events in the short term.

The current social-distancing and sanitation guidelines may eventually become a permanent trend for events as well as alternate options.

Legal concerns

Couples may start saying “I don’t” to “coronavirus clauses” in their wedding contracts.

Under New York State’s newest guidelines surrounding large gatherings, the wedding circuit has been hit hard. Brides and grooms have been forced to change their plans, with some taking legal action to break contracts.

“We have been seeing an increase in pandemic-related contract disputes and litigation, including those involving wedding and other event cancellations,” Robert Alessi, a partner with Meltzer, Lippe, Goldstein & Breitstone, a law firm in Mineola, New York, said.

“We are aware of at least one state court lawsuit that was filed by the mother of a bride whose 300-person wedding was cancelled by the hotel, which then refused to provide the requested refund,” he added.

Such challenges come at a time when the hospitality industry is reeling, and may not recover until 2023, according to a bi-county report on Long Island’s economy about the coronavirus’ impact on the economy.

Avoiding litigation

Now, navigating this new landscape – with its capacity restrictions and the mask-wearing, social-distancing and other guidelines – can be challenging, experts said.

“Many venues and their clients have been attempting initially to resolve these disputes through negotiation,” Alessi said.

“It makes sense for the venues to try to avoid litigation and preserve the goodwill of their clients, who are often direct and indirect sources of future business,” he pointed out. “Many venues are therefore offering to postpone booked events. However, when negotiations fail – for example, when a client declines a postponement offer and instead terminates the contract and seeks a full refund – the result is often litigation, arbitration or some type of settlement mediation process.”

Taking legal action can also prove complex.

“There are many challenges to succeeding in such lawsuits,” Alessi said. “As a preliminary matter, those seeking refunds for cancelled events, including weddings, must read their contracts carefully.”

Several different clauses within a venue’s contract could potentially halt a couple from changing their course. “In many cases, the couple needs to go back and read the contract,” Alessi said. “Most people don’t get lawyers involved with wedding contracts.”

Deborah Minarik, founder and lead planner of Deborah Minarik Events, said many of her clients are scrambling to adhere to the often revised regulations.

In some instances, venues are giving full refunds, she said. Some couples have cancelled their weddings all together, but most of them have postponed for 2021.

“Next year is the biggest thing,” she said. “A big chunk is still doing something small this year, but having the big party later on.”

Pivot to thrive

Stephanie Summerson Hall’s strategy for a diversified business model was smart, but in the midst of a global pandemic, it was genius.

Hall’s primary business, Ruth’s House Event Rentals, came to a screeching halt in mid-March when the coronavirus led South Carolina to shutter businesses and force everyone to stay home. Hall purposely kept her 15-year-old event business smaller and niche, focusing on some long-term clients with annual events, along with weddings and small corporate functions. But even those events were canceled or postponed.

As Ruth’s House Event Rentals’ work paused in the spring, Hall’s newest business venture into the retail space was picking up speed.

In October she launched Estelle Colored Glass, a luxury brand of hand-blown colored glass cake stands and stemware in a mix of jewel tones and soft pastels. The vintage-style pieces are original designs made at a 100-year-old glassmaking company in Poland. Hall was marketing her new business largely on Instagram, reaching out to influencers and sending them samples. She had a good Christmas season.

And then came COVID-19. While nonessential retailers closed their doors, online businesses kept selling products. With more people at home and surfing social media, Estelle Colored Glass — named in honor of Hall’s grandmother — got a boost.

Hall had a second surge of business in June thanks to social media efforts to bring attention to black-owned businesses. In a span of about two weeks, Hall’s @estellecoloredglass Instagram account doubled from 23,400 followers to 51,500 followers. She turned off her Instagram advertising and has been working round the clock to respond to media inquiries and messages from retailers interested in selling her products.

Charleston-based influencer Julia Berolzheimer, who has more than 1 million Instagram followers, posted about Estelle Colored Glass, as did Martha Stewart, Elle Decor and Harper’s Bazaar.

“When she (Julia) did that, it was a turning point,” Hall said. “Very influential people have posted about us. Our sales have gone through the roof.”

Hall said she was so grateful for the attention given to her business and other black-owned businesses, many of which were hurting from the impacts of COVID-19.

The boost in business also allowed Hall to keep Ruth’s House Event Rentals employees working. Instead of delivering event rentals, they were packaging and shipping orders for Estelle Colored Glass.

Hall, a former corporate tax attorney, is always looking for her next business opportunity. She is the co-founder of Wedding Flowers for Rent, renting lush, silk flowers to brides, and hard at work on another business she hopes to launch next year.

Being able to pivot quickly and having a diversified business portfolio has long been a sound business strategy, but Hall said COVID-19 reinforced that lesson in a big way.

“I think of it as hedging,” she said. “If one thing is not going well, the other thing is.”

x

Check Also

(ridofranz / Depositphotos.com)

Employee comments: Show appreciation and morale shines!

Employee engagement isn’t all about how much money an employee makes, or the gifts they receive from their employer. For many employees, a kind word, a simple “thank you” or some peer recognition is all that is needed to keep ...