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Friday, June 26, 2020

How Experiential Marketing Agencies Are Adapting to Disruption


The financial impact of COVID-19 has been felt far and wide, and creative agencies are no exception. As is often the case during a recession or economic slowdown, marketing budgets were one of the first expense cuts to be made by organizations. As a result, most creative agencies have seen at least some, if not all, clients postpone or cancel projects due to uncertainty.

The agencies that were perhaps the hardest hit were those that specialize in events and experiences. These companies produce concerts or festivals, including designing and developing everything the customer sees and senses from the time they enter the event to the time they depart. In other instances, experiential agencies are hired by big brands to plan large conferences or tradeshows, manage foot traffic through the event and design all visuals, ticketing and giveaways. Or, they produce other forms of branded entertainment such as parade floats or football halftime shows.

Early on in this pandemic, as brands were postponing but still hoping to proceed with 2020 events, experiential agencies managed to get by as they continued to plan and strategize. However, as it became clear that most concerts, festivals, conferences and sporting events would be canceled entirely this year, they had to start thinking about other sources of revenue to stay afloat.

Many successfully applied for and received Paycheck Protection Program (PPP) loans and have used that to maintain their staff up until this point, but much remains to be seen as funds begin to dry up. Others have decided to keep only minimal personnel in place, perhaps just the owners and key executives, until work returns.

Here are several ways experiential agencies have adapted to this disruption:

  • Shifting to producing virtual or augmented reality events if the technology and platforms are in place to do so
  • Sending limited crews to the homes of artists to record or livestream remote performances
  • Converting shops and repurposing materials to make personal protective equipment (PPE) for healthcare workers or safety glass for social distancing efforts at businesses
  • Charging clients storage fees for large sets that have been built
  • Offering design concepts and other intellectual property to businesses planning for 2021 events and experiences, often at a reduced rate
  • Selling off office space as staff continues to work entirely remotely

As experiential agencies slowly begin to return to normal operations, the way they go about producing events will look dramatically different. Production crews will need to follow detailed guidelines around cleaning, wearing masks and keeping employees far enough apart while performing their tasks.

Recently we launched a tool to help monitor recovery from this crisis. Our COVID Recovery Tracker monitors which businesses are reopening, where foot traffic is most happening, and if people are staying home or going out. This data is there to provide helpful, localized data trends as well as inform about the latest rules and regulations in each state and county. This insight can keep users connected to how the environment is changing, recovering or rescinding.

We are hoping for and rooting for a triumphant recovery for creative agencies, but we know the difficulties they are undergoing in this new normal. We are here in this time of crisis should you need assistance with any accounting or HR strategies that continue to be impacted due to this ongoing pandemic.

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