By James Clutterbuck, Director of Paragon
With fierce competition for commercial investment, the importance of differentiating your business from others can be the difference between success and failure. Good business fundamentally relies on the ability to build and maintain strong relationships with key stakeholders.
In recent years, more and more businesses have adopted corporate hospitality as a crucial part of their marketing strategy, which has subsequently seen the market value of the industry grow to an estimated £1.2bn. Research conducted on the Rugby World Cup 2015 examined the ‘return on objective’ opportunities that sports hospitality - major strand of corporate hospitality presents, and revealed that over 80% of senior business managers thought corporate hospitality helped to strengthen personal relationships with their clients. It is clear, then, that corporate hospitality serves a function in today’s digital world.
Engagement with clients away from the office shows an interest in developing a more personal relationship with third parties rather than one that strictly centres on business. A focus on a ‘return on experience,’ as opposed to a ‘return on investment’ enables you to establish and re-establish long-lasting client relationships, founded on shared experiences and memories. Sharing high quality, memorable experiences is an effective means of establishing a more personal rapport with individuals.
Corporate hospitality creates an opportunity for you to demonstrate a side of your business that clients would be unlikely to take away from a boardroom pitch. This is particularly true for new business or potential investors. Whether this means focusing on the specific benefits of either your product or service for your client, hosting high-quality and unforgettable events can leave a lasting impression and have a positive influence on brand values. Word of mouth is the cheapest and most trusted form of promotion. According to The Hospitality Report, 52% of UK senior managers believe corporate hospitality is ‘very or quite effective’ at increasing brand value.
In a world where time is money, clever research and wise investment in the right event is crucial. Failure to properly tailor your event for your client’s interests can lead to waste of resources and may even be a deal breaker. At the same time, the consideration you put into providing first-class experiences enhances your own image of professionalism and quality.
The wide variety of opportunities within corporate hospitality enables you to align your events with specific business goals, and your budget should reflect this accordingly. When the primary aim of corporate hospitality is to improve relationships with clients, the value of potential clients should influence your budget. Existing and potential high value clients - those who are integral to your financial success - should be catered for appropriately. This might mean spending more on personally tailored, exclusive hospitality packages, such as VIP sporting events, to guarantee quality time with these clients. Sports hospitality is now a popular choice in the corporate hospitality industry, providing a range of highly effective event packages, whether your client’s preference is for rugby, football, cricket, horse racing or sailing.
Corporate hospitality can also take the shape of larger events targeted at a number of potential clients. Dinners, parties and seminars provide an ideal forum on which to project your brand and forge new client relationships. The more memorable and high-quality the event, the more likely it is that potential clients will remember your business over your competitors. Businesses may find that spending on this style of cost-effective corporate hospitality events can boost brand awareness and help them get noticed by potential clients and stakeholders on a mass scale.
In summary, style and scale will determine your ROI, so don’t scrimp for potential big ticket investors and make sure to spend on events to cater for larger groups when you need to cast a wider net.