The Event Industry Faces Serious Challenges From Coronavirus

Will Coronavirus batter the event industry? Major corporate and social events are being canceled around the world. Is this an overreaction, or a sign of worse to come?

What started as a few minor news stories is now a full-blown global concern. Novel Coronavirus (COVID-19) has captured the world's attention the way Ebola, West Nile Virus, and SARS did before it. The difference this time: the event industry looks set to be among the hardest hit.

Those earlier outbreaks were largely contained before they reached most of the world. This one is not. Over the past few weeks, new cases have appeared in widespread regions.

Air travel now moves people across the globe in hours, not days. That speed is forcing governments, health services, and everyday people to scramble to limit exposure and the health risks that come with it.

As of this writing, more than a thousand people have died, and new cases appear daily. Not only in Wuhan, China, the center of the outbreak, but in travel destinations like Tenerife, northern Italy, and the mainland United States.

The response has been dramatic. Entire regions of Europe and China are under quarantine. Travelers sit confined to cruise ships and resorts. A new prevention tip seems to surface every hour.

Health experts and officials have stayed cautious about the specifics. The economic effects, though, are already clear.

Stock markets around the world have fallen. Nearly every part of doing business, from moving raw materials across borders to flying in staff from satellite offices, now carries risk.

What does this mean for the event industry?

Few industries stand to lose more, and many already are. Events exist to bring people together from everywhere. An easily spread illness turns that core strength into a serious liability.

A few examples show how quickly fear of the virus has upended events large and small:

• In China, the outbreak's epicenter, more than two dozen major trade shows and industry events have already been canceled, with more added every day.
• In Barcelona, Mobile World Congress, a wireless-industry showcase that draws over 100,000 attendees a year, was canceled last week, even though the city had no known cases.
• In San Francisco, Facebook canceled its global marketing summit, costing the city an estimated $11 million in expected revenue.
• Eventbrite, a leader in event hosting and management, has taken a major hit to its stock price.
• Even private corporate conferences have joined the list. Workday's internal sales event in Orlando, expecting more than 3,000 attendees, was called off.

These cancellations look like the leading edge of a much larger wave, one that could cost the industry billions as clients pull out to avoid insurance, ethical, and personal risk.

The starkest warning came from International Olympic Committee member Dick Pound, who told reporters the Tokyo Olympics could be canceled if the virus is not controlled within two months.

The IOC said no decision would come before May. Still, the possible loss of tens of billions for Tokyo, plus the revenue tied to planners and vendors, shows just how exposed the industry is.

Plenty of voices, from event professionals to public officials, are working to calm the panic. What cannot be ignored are the decisions already being made.

As the list of scrapped conferences, trade shows, and meetings grows, many event professionals worry the whole industry could be heading for its worst downturn since the 2008 recession, or worse.

Why is this hitting events so hard?

Events mix people from different places and backgrounds by design. Beyond that obvious reason, a few forces are driving the cancellations:

• Events usually require travel, often across the country or the globe. Since travel is a clear driver of the spread, many attendees are staying home unless the trip is essential. Tourism is feeling the same pull.
• Most business events are optional. As agencies warn against non-essential travel, a conference becomes an easy thing to skip.
• Media coverage has taken a dire tone, as it tends to with any new threat. 37,000 cases worldwide is not small, but against a global population in the billions, the fear has outrun the math.
• Liability is a genuine worry. Hosts and management companies are often responsible for attendee safety, which puts real money on the line.
• Brand risk follows close behind. No company wants to be the one whose event spread the virus to a new region.

So what comes next? How do event planners protect their business?

Right now, no one knows. Until governments, health experts, and industry leaders map out a plan, there is little to do but wait for progress on treatment and containment.

That is cold comfort if you are already losing bookings. So here are practical steps to get ahead of the risk, whatever corner of the industry you work in:

• Make decisions with data. Track the state of the event industry using RSVPify's read on the leading indicators of industry health and recovery.
• Review every event on your calendar, no matter how long it has been booked, and flag the ones expecting large numbers of international attendees.
• For those events, reach out to clients early to learn whether they are considering canceling, so nothing catches your business off guard.
• Talk to event media. When outlets start recommending cancellations before panic is warranted, it only speeds up the damage.
• Read your cancellation insurance closely. Are pandemics or similar events covered under your policies and contracts? Can you recover losses or keep deposits?
• Know your liability as host or planner if someone is infected at your event. Loop in your legal team now, not later.
• Build in virtual conferencing, livestreaming, or other tech so guests can still take part and the event can go ahead in some form.
• Work with clients and venues on safety plans. The CDC and other health bodies have started publishing best practices for prevention.

With any luck, this outbreak follows the path of past ones and is brought under control. For now, these steps are the best protection event professionals have. The damage so far is not catastrophic, but if the threat keeps spreading over the coming months, the pressure on the industry will only grow.

Want more on the trends shaping the event industry, usually in happier directions? Visit the RSVPify blog.