Can the Venue Finding Service Survive?
The topic of the commission model isn’t new and has been debated a lot over the past few years, with certain venues and hotel chains lessening their commission to agencies. This begs the question as to whether venue-finding agencies can survive in the long term or whether they will be forced to diversify?
A few years ago, at the Evcomference, I asked a panel of corporates as to whether they would consider paying for a venue-finding service and I got a resounding ‘no’. Time is money, so I was a bit shocked by this response. Why would in-house corporate planners not believe they should pay for the time venue-finders spend locating the perfect venue for them? Is it because they simply don’t value the service? Or is it because it has been free for so long that they don’t see why now they should have to pay for it? With the slow decline of commission payments, unless the enormous volume of business is there for venue finding agents and they have clients who are booking enormous conferences, the ability to generate revenue is tougher, especially if they can’t charge a venue- finding fee for their services. I know of a few agencies which are having to build out their offering as venue-finding alone simply isn’t enough for them to survive. Although we rarely offer venue-finding as a stand-alone service, whenever we have provided this, we have had multiple occasions where we have done lots of work, and the client has failed to tell us that they have been working on solutions themselves, or even worse have tried to go directly to a venue we have proposed.
How can we protect the work that we do as an agency? There is a feeling from some venues (from my own past experience) that they don’t really value agencies and would rather deal with the end client directly, and therefore are less interested in paying commission for the business. Having dealt with countless venues in my life (as well as clients), the role that agencies should play is a strategic and educational one. On many occasions I have been staggered by the lack of experience that in-house event managers at venues have. If then faced with a client who also hasn’t been in a role of this nature for long, the chance of delivering the best kind of event possible in that venue is less than if they had got an agency involved to advise them through the process. If venues don’t believe
they need to pay a commission to agencies and in-house corporates don’t believe that they should pay for the venue-finding service, then how can the venue-finding model survive in the long term unless there is a call to change the model across the industry? I run a full-service events agency and have shied away from just providing venue-finding, or indeed setting up a department for venue-finding alone, as I believe that this service in isolation is on its last legs.
What do you think? It would be interesting to hear from venues and corporates alike as to the views in the industry.