While the live events industry has evolved in many ways over the last decade, one of the most noticeable changes has been the reduction of companies due to industry consolidation, through a sweep of mergers and acquisitions taking place across the market.
The result of this trend has left the industry with fewer players, basically a couple of giant mega-corporations owned by private equity firms, along with a more limited selection of owner-operated firms that are in a constant battle to compete.
In an industry built on service and relationships, it’s important to not only take a deeper look into who you are actually working with on your next event, but also consider how the ownership structure of your staging provider can have an impact your customer experience and show.
Of course, consolidation is not limited to the live events industry, it’s a common trend in today’s world in a general sense. In some cases, it can be a positive outcome to the consumer, but in many instances, something tends to get lost in the transition. For example, think about a great restaurant when it first opens and is owned and operated by the chef. The owner brings his/her personal attention, care and passion to the business, and literally and figuratively a “secret sauce” to how the meals are prepared and served. As a result, the business becomes very successful, franchises open, and eventually they can get an offer for acquisition by a large investment firm. Some of the main elements may still be in place that made it successful in the first place, but is it still possible to offer that special level of “secret sauce” to the consumer when an investment firm is at the helm?
Unfortunately, in most cases, when a business that relies on great service to thrive, it becomes nearly impossible to offer the same level of quality after an acquisition by a private equity firm. In the live events industry, most clients are looking to develop long term relationships with trusted staging providers that have history of success and reliability. With the industry landscape changing so rapidly these days with these dominant mega-corporations, clients can hardly depend on whether their staging provider will even have the same name for their next show or be in business at all.
It’s not all gloom and doom, there are companies out there with passionate people that offer high quality solutions and are invested in the success of their clients. If you are looking for a long-term staging partner, it has become critical in today’s industry environment to learn more about who is behind the company you will be working with on your next show. Ask about ownership, the qualifications of the leadership team, and look for longevity. An owner-operated staging company is most likely going to bring that passion and “secret sauce” to executing on your event and will be focused on delivering on your results. On the other hand, a company owned by a large investment firm is mainly focused on their own bottom line. Ask yourself, would you rather work with a company that is trying to exceed the expectations of their clients or a board of directors?
Another thing to consider is the level of personal connection you are going to receive when contracting with an owner-operated staging partner. When contracting with a staging company for your next event, ask about who you are going to call if a problem arises. Find out how issues will get resolved and escalated through the leadership of the company and take notice if there is a direct connection to the ownership. A good owner puts their name and reputation behind what they deliver, because they are in this business for the long haul.
Through all this maze of change in the world of live events, industry consolidation has narrowed the playing field and impacted the customer experience. The big players owned by private equity are here for now, but can this environment be sustainable for the future is the big question. Investment bankers don’t know what we do to deliver a great show, and more importantly, they really don’t care. They only care about ROI. There is tremendous value in knowing the roots of the team behind your staging company and developing a relationship with a provider that can deliver consistent results with enthusiasm and passion. Why settle for anything less?
Les Goldberg founded LMG, LLC, a national provider of video, audio, lighting and LED support in 1984 with a small loan from a relative. He also acts as CEO of Entertainment Technology Partners, LLC, the parent company of a collection of exceptional brands within the live event and entertainment technology services industry. He recently published the book, Don’t Take No for An Answer, Anything is Possible, available on Amazon and iBooks. For more information, visit www.lmg.net and www.lesgoldberg.com