Two years ago, I wrote an opinion piece on this site headlined ‘Maritime awards: it’s time the industry woke up’. While most people who cared to comment on it via various channels including social media were overwhelmingly in agreement with my point that awards ceremonies were a waste of time and money for those participating, there are now probably more maritime awards events than ever before.
Someone in the industry recently contacted me, interested in my assertion that the awards events attached to maritime publications are much bigger money spinners than the publications they so desperately need to have relevance. It is hard to believe, especially when these awards events are pitched as somehow “giving something back” to the industry.
So what I’d like to do is go through the dollars and cents of how a maritime awards ceremony works.
Every maritime awards event is driven by sponsors, this is the name of the game. In my time spent in and around the inner workings of these ceremonies, the cost of sponsoring an awards ceremony is anywhere between $10,000 to $30,000. It depends on the company behind the awards event, and what you will find is the sponsorship amount depends on who you are. If you’re a classification society, for example, be prepared to pay more than others because its generally believed you’ve got deeper pockets than other companies – despite your benefits being exactly the same as any other sponsor.
Let’s say an event averages $15,000 per sponsor and picks up 10 sponsors (some events have up to 20!). You’ve just banked yourself $150,000.
This is my favourite aspect of how a maritime awards event works. Once the sponsors are in and the venue is set, its time to get nominations. You’ll often find that organisers spend a lot of time on this aspect, and that’s because it is of major importance.
Let me say this now. If you nominate your company into a maritime awards scheme, then you are almost guaranteed to be a finalist. That is because organisers struggle to get enough nominations in each category. Ever received an email from organisers saying “Nominations have been extended due to popular demand”? This actually translates into “We don’t have enough nominations so will move the deadline until we do”.
Nominations are important because the event needs at least four or five companies for each category (eg best port) to look credible. In many categories this is hard, especially when it is obvious to companies in that category that a particular company is going to win every time (although that’s another story).
The other reason, and the main reason, that nominations are important is because once you have five companies nominated (or more) you can tell them they are going to be a finalist in the category. Sounds exciting, despite the fact that everyone who nominated is a finalist. What is even more exciting to the organiser however, is that now you are a finalist it’s pretty important to be there just in case you win. That brings me to the next revenue generator.
Table sales at a maritime awards event are the icing on the cake for organisers. If you’re running an awards night, have 10 categories with five ‘finalists’ then you have around 40 companies (some companies are in multiple categories) that need to be at the event to see if they are going to win.
So A.N. Other Shipping Company, we’re pleased to inform you that you are a finalist for the maritime innovation award. You might win, so it’s rather important that you attend – please buy a table. I’ve just looked up on some awards sites that the price for a table is anywhere from $3,000 to $5,000 for a table of 10. If you’re lucky you may be able to buy a half table, or an individual seat if travelling from out of town although in some cases this isn’t advertised.
Let’s say out of 40 companies, all obligated to be there, that 32 of them aren’t sponsors. Out of 32 companies, you should be able to sell 25 tables assuming many take a full table, some take half tables and a few people just buy tables even though they aren’t nominated.
If your sponsorship hasn’t gone as well as planned, you can always add extra categories that are ‘sponsored’ by your own publication/s, because remember it’s a guarantee of more table sales.
So, if we run the numbers on 25 tables at a middle point of $4,000, then we’ve just made another $100,000.
After the awards
I have to admit, it’s now been many years since I’ve been involved in maritime awards schemes (and never will be again), so I don’t know if this still happens. However, it used to be standard practice to put together a winners’ programme or special report in a publication to ‘celebrate’ the winners.
If you’d be so kind, please celebrate your victory by placing an advertisement in/against this special commemoration of excellence in maritime. Out of 10 categories, you’ll probably pick up five or six ads pretty easily and net yourself another $20,000 to $30,000.
Even if you don’t do a special publication, you’re obviously banking on your ads salesperson to move in and use the goodwill for obvious purposes.
Let’s tally this up then
So we’ve made $150,000 in sponsorship, a further $100,000 in table sales and let’s say conservatively an extra $20,000 in advertising as a result of the awards. We’ve just made more than a quarter of a million dollars in revenue for a three or four hour dinner.
We also put together a scenario of 10 sponsors and 25 tables sold, so 350 people in the room. Maritime awards events can be anywhere from 300 people to 700 people in the room generally, so you can do the maths on the results of a more successful event yourself.
Again, it has been a long while but I’m wiling to say that the event would cost no more than $100,000 to put on. That includes the venue, the host and entertainment, marketing material, and the excessive travel expenses of all those internally associated with the event.
How many can we do?
Based on the above, we’ve just banked $170,000 profit from one event. Great business, let’s do more of them!
Rather predictably, all the maritime publishers that put together an awards ceremony get addicted to them. With the steady decline in print advertising across all industries combining with a depression in the shipping markets, a $170,000 windfall is not easy to come across in maritime publishing. I would safely say it is beyond many of the publications that run these events. Many don’t even book that much advertising in a year it would be safe to say.
What’s the solution? More and more awards ceremonies. One for Europe, one for Asia and one for the Middle East is a minimum. How about the US or China, Greece or India? Maybe even hone in on a particular sector such as dry bulk, tankers, safety or the environment. The possibilities are endless! Three relatively successful events should easily net half a million dollars in profit.
So what is my point?
My previous opinion piece already spells out my views on these events, but the maritime industry has yet to wake up. However, what I hope this piece provides is a better understanding of the motivation behind maritime awards ceremonies that “give back to the industry” while filling your social media timelines on an almost daily basis.