Return on Investment: Sense vs. Cents

Meeting PlanningProfessionalTrends

event roi

There was a time not so long ago when a conference session on ROI probably could have been staged in a boardroom and meeting planners generally thought of it as a complicated accounting formula.

How times have changed.

The recent recession-generated furor over meetings and conventions was a wake-up call for the industry that pushed return on investment to center stage. The firestorm of criticism—though perpetuated by many who were not familiar with the industry—clearly illustrated the need to do a better job of proving a meeting’s value to stakeholders and the public.

That’s music to the ears of people like Jack Phillips, co-founder of the ROI Institute in Birmingham, Ala., and Terri Breining, head of The Breining Group in San Diego. They’ve been preaching return on meeting investment for years, but frequently were met with stony indifference. Many planners figured that conversation was strictly for the boardroom. Now planners are moving into that boardroom—or at least to the executive table. They’re starting to think strategically, justify meetings and measure ROI as part of a move toward accountability in all facets of company events.

“As we went into the recession, executives started asking the accountability questions, and those who couldn’t answer saw meetings get cancelled,” Phillips says.

That lit a fire under meeting planners who didn’t want to see valuable meetings—and their careers—go down the drain. By aligning meeting content with business objectives and measuring the results, planners have found they can be a better partner to management teams and also retain valuable programs.

“ROI provides a vehicle for the planner to have more influence over which meetings are held and how they’re configured, rather than be an order taker,” Breining says.

Nevertheless, there’s still evidence of resistance when it comes to ROI—both from executives and planners. In a study of Fortune 500 CEOs conducted last summer by the ROI Institute, 96% of executives said they wanted to see the business impact of learning, but only 8% currently get that feedback. Similarly, 74% said they want to see ROI data, but only 4% receive it.

At last summer’s MPI WEC conference, organizers expected an overflow crowd for the ROI session. Instead, it didn’t even fill up. “The dilemma with ROI is that associations have pushed it, but members don’t much want it,” Phillips says. “We don’t see droves coming into the accountability arena.”

Ira Kerns, managing director of GuideStar Research/MeetingMetrics in New York, says most people think of ROI in financial terms instead of as a “ladder of impacts.” The ladder progresses from new knowledge or skills to new behavior that generates measurable business and financial results.

What it really boils down to is sense versus cents. The “sense” is in creating meaningful meetings with measurable objectives and positive financial impact. The “cents” aligns spending with those objectives.


Those who talk about strategic meetings management programs often mention the need to speak the business language of the boardroom. The same can be said for ROI.

When you set objectives, measure the learning gained, see how that learning is applied and realize the bottom line effect on the business, you demonstrate ROI. That demonstration may get you a previously denied seat at the boardroom table. “Part of the ROI process is learning to talk about meetings that way,” Breining says.
According to Phillips, the meetings most likely to benefit from complete ROI measurement are those with high costs and high attendance. That would appear to leave out the roughly two-thirds of all corporate meetings that are for 50 people or less, according to research firm PhoCusWright.

Not so, Phillips says. Most meetings can benefit from some ROI measurement—even if it simply measures knowledge gained in one session.

That’s where the ROI Institute comes in. Its methodology is intended to be a road map for accomplishing the goals of a meeting. It helps executive teams decide which meetings are the most valuable, which might need tweaks and which should be discarded. To do that, it takes planners through five key steps that can help measure the value of any meeting:

  • Identify the reaction or planned action you hope to deliver from the meeting
  • State the learning goals
  • Measure how well the learning is applied after the meeting
  • Measure the effect on the business
  • Compute the net benefit of the meeting

The ROI Institute also includes helpful tools and templates to help calculate ROI for participating sponsors, exhibitors and organizers, as well as attendees.

Association Sense

Associations can use the ROI method to find out how much benefit they get from member attendance at an annual convention. Members can use it to justify their attendance, too, which is particularly useful in recessionary times when employers stop paying membership dues for professional organizations. Both uses might stem the tide of shrinking membership and fewer attendees at association conventions—reductions that may even threaten an association’s existence or its chapter status.

The American Society of Association Executives addressed those concerns head-on last summer when it published a Justification Toolkit for members to help them get approval to attend the annual convention. It included an article about measuring personal ROI, a letter template for supervisors that justified the cost and a cost calculator that compared stand-alone educational sessions versus attending them during the conference.

The idea to provide prospective trade show attendees with a similar template on a show’s website was among the top 10 innovative ideas presented at the recent Trade Show Executive Gold 100 Gala and Summit in Palos Verdes, Calif., according to the Marketing Design Group in San Diego.

“[Justification] is a step in the right direction,” Phillips says. He added that attendees still need to be clear about what they will bring back to the organization from the meeting or trade show, such as materials to share with colleagues or an offer to present a conference summary to co-workers. “That helps justify future attendance,” Kerns, of GuideStar Research, says.

Measurement Sense

Measurement tools are essential to ROI, but before measuring post-conference results, planners need to make certain that the meetings comply with internal requirements. Automated systems like those from Worktopia in White Plains, N.Y. enable companies to enforce policies and reduce the risk of forgetting to include essential contract clauses or preferred vendors.

“It’s meetings management in a box,” says CEO John Arenas. The system tracks all meetings spending, manages suppliers, compares invoices to booking data and ensures that preferred vendors, room rate limits and other policies are enforced.

MeetingMetrics is another system that “takes the heavy lifting out of ROI,” according to Kerns. Users choose the post-conference reports they want and the system spits them out. A Maritz program’s Event Scorecard includes pre- and post-conference modules that help measure participants’ understanding of core company goals and help companies improve their meetings’ effectiveness.

Preparedness Sense

Planners who still doubt the need for measurement and goal-setting might look to recent Congressional actions to see the writing on the wall. In September, a U.S. House of Representatives Committee asked CEOs of 52 health insurance companies for detailed data on all conferences, retreats or other events held since 2007. The industry’s biggest names—including Aetna, Aflac, Blue Cross Blue Shield affiliates, Cigna Corp. and United Health Group were among those asked for data.

Requested data included “all conferences, retreats or other events held outside company facilities from Jan. 1, 2007 to the present that were paid for, reimbursed or subsidized in whole or in part by your company, as well as the purpose of such events and documents sufficient to show the location, number of participants and all expenses incurred, including transportation, lodging, food, entertainment or gifts.”

It may be a sign of things to come, regardless of whether or not you think Congress should be asking for such information. “We need to accept that people will continue to ask those questions,” Breining says.


The Congressional inquiry that may turn your blood to ice water brings us to the dollars and cents of ROI. Everyone knows the basic formula: revenue minus expenses equals profit. But does profit equal ROI? That’s not as easy to answer. Nor is it always the right question.

“We’re constantly aligning ROI with spending, but ROI and the meetings budget are two different things,” said Ron Naples, associate professor at NYU in a roundtable webinar hosted by American Express Business Services. Naples said the first issue should be to define the meeting’s goals, which in turn determine the budget. The second should be to define which part of the meeting the host thinks is the most important. Then direct the lion’s share of the budget to that activity.

ROI methods also make “cents” by improving accountability and eliminating waste—or wasted effort—that uses up precious dollars. “It’s wasteful if the wrong people come or they come for the wrong reasons,” Phillips says. Sessions with the wrong content also are wasteful. So even when you’re eliminating waste, it comes back to the basic question: why is the meeting held and what should attendees take away from it?

Some people believe switching to virtual meetings makes “cents” in the current economic climate. Robyn Renner, manager, sales performance and development for Bayer HealthCare in Morristown, N.J., disagrees. “The misconception is that you can use virtual meetings in place of in-person meetings and that’s not a true statement,” she said during the American Express webinar in July. While virtual meetings may reduce costs, they’re not always the most appropriate way to reach a goal, she said.

At Bayer, they assess each meeting to determine whether it’s more beneficial to meet virtually or in person. “We come back to the idea of aligning people to a message and ask (whether) the in-person meeting is the most important,” she says. Since her team began to look at every meeting in terms of ROI, they’re more aligned with the objectives of senior management instead of being focused on meeting costs. And it all tracks back to defining what makes an effective meeting.

In measuring intangibles like applying new knowledge in the workplace, the “cents” takes longer to show up because it takes time for people to apply new skills and have that effort translate to dollars. That’s why MeetingMetrics includes ways to measure things like customer satisfaction and participant ROI.

Using MeetingMetrics, an organization can internally compute the dollar value of improved customer satisfaction. Nonprofits might measure how many volunteer hours they generated as a result of a meeting. Associations might develop an individual ROI measurement to demonstrate what the association gained from member attendance at a convention. “It’s a powerful tool for demonstrating value to attendees,” Kerns says.

Whether an organization uses automation to be more effective with their meetings dollars or simply starts by defining what projects require in-person meetings, the effort to align business and meetings objectives and measure returns is sure to sit well in the boardroom.

Astute meeting planners who embrace ROI are likely to find themselves with a more prominent seat at the executive planning table instead of out on the street wondering what to do next. Robyn Renner is moving toward that prominent seat. Today, she’s more of a consultant and facilitator than a planner, she said during the webinar. Renner says a focus on objectives helped her reposition meeting professionals to a higher level within her organization. “It changes the mindset from meetings as an expense to meetings as an investment in the business and in the people,” she says.

Now that’s really ROI.

Study Shows Link Between Business Travel and Increased Sales   

Companies on the slash-and-burn trail of all business travel spending might want to reconsider their tactics. A new study conducted by New York-based IHS Global Insight on behalf of American Express Business Travel and the National Business Travel Association demonstrates that a 1% increase or decrease in travel spending corresponds to a 1.7% increase or decrease in sales.

The study took into account data from 9,500 companies in 15 industries and spanned a 10-year period. It showed that economy-wide corporate profits would be maximized with an increase in business travel spending of 5.3%, or roughly $14 billion. Economy-wide, that could result in a total industry sales increase of 3.7%, or $894 billion. It could create gross operating profits for U.S. business of 4.4%.

The study found that industries like pharmaceuticals and medicine have more potential for positive return on travel dollars invested than do industries like consulting services. The study used data from 1998–2008. It did not include figures from 2009, when business travel dipped by nearly 15%.

Getting Started

Planners who have avoided talk of ROI until now might as well shelve any remaining excuses in their arsenal and get on board. Not only does “roi” mean “king” in French, it’s now king of the meetings industry. It doesn’t have to be rocket science, but you also can’t go it alone. Here are a few tips for getting started:

  • “Establish clear goals,” for each meeting, says Chris Gaia, vice president, marketing, Maritz.
  •  “Be transparent and share meeting goals with those who are planning the meeting,” says Ron Naples, associate professor at NYU.
  • “Make stakeholders aware of what you’re trying to do,” says Tamara Gordon, global travel and meetings director, United Health Group.
  • “Align your staff from senior management on down…have them come back to the idea of aligning people to a message,” says Robyn Renner, manager, sales performance and development, Bayer Healthcare.

Another Perspective

Sharan Jagpal, a professor of marketing at Rutgers University and author of Fusion for Profit: How Marketing & Finance Can Work Together to Create Value, suggests that typical ROI measurements are too simplistic to be accurate. He says a true measurement needs to account for uncertainty by using a weighted formula that measures long-term versus short-term gain.

For instance, in the case of the MPI session that didn’t fill up, he says organizers might have considered reaching out to a focused group of upper management people instead of targeting all attendees for the session. There may have been fewer people, but it might have produced more long-term gain.
In the case of a trade show like Comicon that sells out every year, a sellout might spell only a short-term gain. “Organizers may be reaching one-time attendees who won’t come back,” he says.

 Smart Resources

Sandi Cain, a regular contributor to Smart Meetings, is a freelance journalist who covers the meetings, hospitality and tourism industries.