A backward glance at 2020 and a look ahead to 2021
Yes, it’s been a terrible year for live entertainment but we’re not going to focus on that. What we are going to do is sum up some of the most important things we learned over the past year and how what’s happened will affect the events and insurance industries as we enter 2021. Before we dive in, here are some staggering statistics. Fair warning...they’re not pretty.
- $30+ billion in losses for the live events industry globally. - Pollstar
- By the end of 2020, 170,000 jobs will have been lost in the UK alone. - NME
- Entertainment and media was a $2.1 trillion industry in 2019 and expected to shrink 5.6% in 2020. - PWC
We were so naive
2020 was off to a great start with the live events industry expected to grow by more than 10%. Predictions for the industry included a surge in the use of technology to enhance the live event experience, including automation, artificial intelligence and over-the-top audio visual effects. There was an expectation that the cultural exchange of popular music festivals would continue to expand and bring talent from all over the world to new destinations. Hybrid events had an entirely different meaning referring not to going digital but to building an entire immersive experience involving activities and amenities. There was a focus on managing crowd demographics and implementing loyalty schemes to help tailor audience experiences. Environmentalism was the biggest concern facing the industry and improving practices to reduce the impact on surrounding ecosystems and making events more sustainable was center stage.
Then came Corona
Events were cancelled. Travel was halted. Lockdowns ensued. As summer approached, event promoters were trying to stay positive, hoping that warmer temperatures would allow events to go on as planned. When that didn’t happen, the race was on to implement creative solutions. Enter drive in concerts, socially distanced seating and extensive hygiene plans. But, these requirements meant venues were operating at a fraction of capacity which was simply unsustainable.
With a complete industry standstill and no work to be had, live event professionals around the world were overlooked or worse, told to retrain and find new professions. Campaigns like #WeMakeEvents, #ILoveLive and #LetUsDance, among others, are still seeking to draw attention to the plight faced by so many individuals that have been left behind by our governments.
There’s light at the end of the tunnel
The holiday season brought with it some positive news. Vaccine announcements came rolling in resulting in surging stock prices. Countries around the world started trying to get their hands on as many doses as possible and governments began coming up with game plans for distribution. The US and UK are among a few nations that have already started administering injections to health care workers and people most in need.
Additionally, funds have been set up in several countries to provide event professionals some reassurance that even though insurance providers are not offering coverage for Communicable Diseases, if COVID necessitates a cancellation, they will have options. The fund has been approved in Germany and many other countries are following suit with appeals to their respective governments for support.
Following the approval of the vaccine and possible funds for Corona related cancellations in 2021, there is an overwhelming sense of optimism in the industry and promoters are doing everything possible to push forward with plans.
Let’s ride that wave of optimism and assume live events will be back in full swing by Q2, what does that mean? From logistical challenges to travel considerations, we can see 6 central themes that are going to keep event planners up at night.
1. Logistical Challenges
Many of the large scale events that we’re forced to cancel in 2020 will rollover to 2021. Planning is largely complete in many cases, albeit with some rather significant changes, including:
- implementing extensive hygiene protocols
- accommodating social distancing requirements
- conducting onsite testing and/or vaccination verification
- providing contactless solutions for everything from ticketing to cashless payments
Increased demand for live events may necessitate the need for more smaller and medium sized events. This is definitely not a bad thing; small to medium sized events with fewer attendees lowers risk and allows for more attention on ensuring safety which instills confidence for those that may be wary of jumping back into life pre-COVID.
Historically, waiting until the last minute (or in the case of many smaller and medium sized events, not bothering at all) to obtain event cancellation insurance was common. That’s all about to change. Insurers won’t be offering COVID cover; however, it's likely event cancellation coverage will be required to access funds for any government backed insurance initiative. Furthermore, it’s likely insurance premiums will increase due to the elevated risk. Check back in early 2021 for the full insurance industry outlook.
Event enthusiasts will have had an entire year to anticipate their next live experience and expectations are going to be high; organizers are going to have to go big. With limited financial resources and the ever present uncertainty, this poses a challenge never seen before.
5. Lack of Industry Talent
The global shutdown forced many companies out of business and individuals to lose their jobs. Most people cannot afford to spend an entire year unemployed, especially given the lack of support from the government. There simply may not be as many event professionals available to fill the roles that so few have the necessary skills and talent to do. Additionally, increased demand for shows may limit the pool of available suppliers that have been able to weather this year long storm.
Yet another industry that took a huge hit this year and still remains a large concern as we enter 2021 is travel. Restrictions vary from country to country and even state to state which makes it an incredible task for event professionals to plan and execute. And, completely unrelated to the pandemic, Brexit is still expected to occur on January 1. Organizers may need to focus more on local talent to ensure there are no travel related restrictions that could affect an event's chances of success.
Nobody thinks the return to live will be easy, but with the amount of creativity and problem solving it takes to host large scale events, there are no people better suited in the world than those in the entertainment industry to meet this challenge.
Looking further ahead
Pre-pandemic newsreels were centered around climate change. The bushfires in Australia (yup, that was also this year) was a rude awakening for many to the potential outcome and scale of climate change on our world’s ecosystems. We’re not scientists; but unfortunately, we’re pretty sure this particular problem won’t be solved with a vaccine. The spotlight on sustainability will return when it comes to live events and unlike the pandemic (which is temporary, believe it or not) will have a more permanent impact on the future of the industry than rapid testing and social distancing. Getting through 2021 is the main objective but looking to the future and understanding the implications that this year will have in the long run is crucial to ensuring success.