All of us have gone through budget cutting. Nobody like budget cuts but in this world it has become a necessary (and unnecessary) evil. There are three areas that should never be cut:
- Anything that affects the product
- Anything that affects the customer
I am sure all the bean counters out there are reading this and saying “but we don’t have a choice, every department needs to cut”. Cutting budget to any of the above three things will hurt incoming revenue. The live event & entertainment world has already seen huge deeps in ticket revenue. When you cut budget to any of the above you are just increasing the collateral damage.
Our customers and fans are used to our product. If anything, they expect us to offer even better product. If they notice you are decreasing the product in any way, you are ruining the business. If you don’t have the money to increase the product, then it is better to maintain status quo until you have the budget.
Anything that affects the customer experience in a negative way is detrimental to your business. Just like the product, the customer expects a certain type of service. Take away the good experience and you take away the customer.
For some reason bean counters always look to marketing first to make budget cuts. Why do they do this? One reason is the attitude that some business people have of marketing. How many of you have heard “sales brings in the money and marketing spends it”? If you cut money to marketing, you are letting less people know about your product. If less people know, fewer tickets will be sold. The alternative is to leave the marketing budget alone and figure out how to obtain even more exposure with the same budget.
If you trim too close or in the wrong places it can really hurt!