A CEO of a publicly traded, Atlanta-based technology company sat with his CCO, CMO, CTO and Vice President of Marketing around the table as they were outlining the annual sales meeting agenda and he said casually, “We spend how much for this meeting?”
The CCO answered, “About $800,000 give or take.”

To which the CEO replied, “I guess I should consider measuring the return on investment for this at some point. Now, about the video….” And he was on to the next topic. What he may have been alluding to was that within his company questions were being asked about what value some of the flashier elements of the meeting were really bringing, and whether the money was being spent in the best manner possible.

Meanwhile, the American president of a privately held retail flooring cooperative was having dinner with his Canadian counterpart and two of his vice presidents. They were discussing one of their upcoming semi-annual conventions, and what could be improved about it based on an exit survey of the attendees from the last event. The president had inherited the conventions from his predecessor, and it was generally assumed that the revenue generated by the conventions was worth the $1 million-plus expense it represented to the bottom line. He said to his team, “I would gladly pay an additional $20,000 to measure the ROI I am actually getting on Convention.”

This particular president, who understood ROI from marketing applications, was willing to concede that it was entirely possible to use the same principles and formulas, but where he struggled was how to measure the intangibles – a shift in attendee attitudes and behaviors. He wanted to understand those results as much as anything to grow his company.

Yet another case in point arose at the regional headquarters of an international network and telephony, where the Director of Marketing had her annual customer conference funding canceled. The company spent approximately $250,000 for an audience of approximately 200 every year. However, the small sales force and even smaller marketing department did not have the manpower or processes in place to track the results the conference represented. As a last- ditch effort, the Director took an ROI analysis plan with her to a company meeting in Europe to try to save the event, but it was too late. Budgets had already been set.

The variations on the ROI theme are as endless as the meetings they represent. Executives want to know how they are doing. For some it is about growth, for some it is a casual interest, and for some it is the life or death decision about their meeting. Regardless, these very real stories bring to light how the meetings industry is in an enviable position to answer a very urgent need that is not currently being filled by most meeting planners or suppliers, despite how much it is the topic of discussion within the industry. With executives willing to pay good money for ROI analysis, why are there only a handful of certified ROI experts in the US for the Meetings Industry?

While ROI has been a hot topic of discussion around meeting circles for a few years now, and there are many companies who claim it as a part of their offerings, and many individuals who propose to teach the process at planner conferences and conventions, a general vagueness and confusion still seems to permeate the industry around ROI. On industry blogs some complain that it is essentially immeasurable and futile. Some companies have added it to their offerings, promising that they “guarantee” a positive ROI on meetings they produce. Others say they are measuring ROI and ROO (Return on Objectives) just to add to the acronym soup. Many planners say they are measuring ROI by looking at expenses against profit on events in a budget spreadsheet.

MPI and other sister organizations have worked very hard over the years to professionalize the industry with designations such as CMP, CMM and CSEP, just to name a few. These designations are driven mostly by standardization of learning around meeting and event planning and management. Those that have worked hard to reach that designation have earned the respect of their peers – and although industry outsiders are not always certain what the designations actually mean, they acknowledge that the designation itself carries a certain level of added credibility.

Common ROI Myths:

Myth: If an ROI Analysis is not positive then I will have just put myself out of a job.
Truth: ROI is a function of business objectives, and is a powerful tool for assessing what is working or NOT working in a meeting. A well designed ROI analysis, even if it is negative, will provide the information that an executive needs to understand what to change about a meeting to ensure it truly does have the desired impact NEXT time.

Myth: There is no standard formula for measuring ROI.
Truth: The formula for Meeting ROI is essentially the same as it is in finance, training and every other ROI Analysis:

Net Meeting Costs
ROI (%) ———————– X 100

Meeting Costs

Myth: ROI measurement of intangibles (changes in attendee behaviors and learning after the event) is not possible.
Truth: At the outset of an ROI Analysis, the objectives of both the meeting and the analysis are agreed upon. At that time it is determined what level of measurement will be achieved. The five levels are:

  1. Action and Reaction: measures participant satisfaction with the meeting and captures planned action
  2. Learning: Measures changes in knowledge, skills and attitudes due to meeting.
  3. Job Applications: Measures changes in on-the-job behavior and planned actions.
  4. Business results: Measures changes in business-impact variables (such as sales)
  5. Return On Investment: Compares meeting benefits (to the company over time) to meeting costs.

Myth: ROI Analysis takes an enormous amount of planner time.
Truth: It takes more planning and executive support than actual execution time if structured correctly – planners in the ROI certification course develop ROI analysis plans within hours. Alternately, there are companies in the industry that can help planners execute ROI plans very economically.

Excerpted from a 2010 Meeting Professionals International article by Stacey Ruth.