A few years ago, the annual Sales Kickoff Meeting (SKO)—a bash where the entire sales team gets together to review goals, generate motivation, celebrate successes, and plan out the strategy for the coming year— was a given at most organizations. Now, the combination of Covid concerns, the rise of the remote workplace, and even the proliferation of sales readiness tools like Brainshark—which facilitates everything from sales coaching to improving sales performance and speeding up new-hire onboarding—are causing executive teams to question whether the costs of holding an SKO for the purposes of sales enablement are justified.
The good news is that when it is budgeted for properly, the SKO is likely to deliver substantial ROI for the entire organization in both dollars and employee satisfaction.The bad news (depending on who you are) is that it now often falls on sales and sales enablement leaders to furnish evidence for the c-suite that an SKO is worth the investment.
In this article, you’ll find applicable formulas and a sample SKO budget you can use to calculate the ROI of your next sales kickoff event and get your company leadership on board.
Calculating ROI in Sales Kickoff Events (SKOs)—Leading versus Lagging Metrics
For predictable results and demonstrated improvement, sales enablement needs measurable metrics.
There are two broad categories of metrics to understand:
- Leading metrics (or leading indicators) and
- Lagging metrics (or lagging indicators)
As defined in this article on sales metrics, “Leading indicators are simply those that you can measure as a direct outcome of your activities” and “Lagging indicators are simply those that you cannot measure as a direct outcome of your activities,” but which a company usually cares most about, such as revenue, quota attainment, and average deal size.
To properly measure the ROI of a sales kickoff event, you would need to know about the event’s lagging indicators such as deal size, deal velocity (how long it takes for a deal to move from start to close), and sales team turnover, among others.
The Formula for Calculating the ROI of your Sales Kickoff Event
Using our suggested cost factors below, you can compile a spreadsheet and accurately determine the ROI of your sales kickoff event.
Every company has different requirements and concerns, but the most common SKO costs are listed below. These can be used as a starting point for your ROI calculator—whether you use a spreadsheet, an online form, or another in-house tool—and can be adjusted as you find other metrics and costs that contribute to or detract from the ROI.
Travel expenses for employees
If you will be holding an in-person event, include a field in your calculator for travel expenses, then multiply this by the number of attendees who don’t live locally and will be traveling in for the event.
Formula: Average travel expenses per person x # of attendees traveling= Total travel expenses for SKO
You might need to break this down per travel method, such as train, car, and flight costs.
Food and drink
This one is simple if you hire a catering company as they will usually provide a per-head fee. Sometimes, food and drink costs are included in a venue’s overall costs.
If you are holding an in-person event (recommended) and won’t be holding it at company HQ, the venue overhead needs to go into the calculator.
The venue needs to be considered carefully, and is a vital determinant of the event’s overall ROI in the long term.
The venue you select for your SKO will impart several messages to your employees, including:
- How much they are valued.
- Their perception of how well the company is doing—people like working for a winning team, something that can affect employee turnover.
Slapping a sales team together at the HQ boardroom for the SKO, where no one can move and the feel is not one of “celebration,” might actually harm overall employee morale. And employee satisfaction translates into dollars. A Gallup report on the matter shows clearly that employee engagement has an enormous effect on multiple performance metrics.
Similarly, hiring out a superyacht for your next SKO is also not necessarily the greatest move because the cost will likely wipe out any potential returns.
There are many excellent event venues available that are professional and don’t cost an arm and a leg.
This may seem like a silly consideration, and as such, can be easily overlooked. But just as the HQ boardroom is unlikely to excite employees, a bland event venue with no spark will also only go so far.
Hotels and conference centers often contain packages that include decorations but these won’t help if you want to do something to show your company’s branding.
A few well-placed banners and balloons, as well as event souvenirs like shirts or office supplies, can go a long way. These are negligible costs that can do wonders for overall employee satisfaction but can add up when not monitored, so they definitely should go on the calculator.
Even if your event is in person, you will need to consider technology. If the venue doesn’t provide a PA system and your company doesn’t have one, you will need to rent or buy the equipment. You will also likely need laptops, cords, connectors, and IT help setting everything up so presenters can easily navigate the system and show any slides they may have.
Note: Don’t forget to test the system beforehand! Poor-quality sound can turn an otherwise well-prepared event on its head quickly, bringing all the prep-work to nothing.
It’s a great idea to hire one or two external keynote speakers for the event. This can add to the feeling that the event is a big deal.
Well-known speakers are notoriously expensive, some of them charging many thousands of dollars for an hour’s talk. Perhaps your company can afford this, but will it bring ROI?
In the interests of a return, rather pick someone that isn’t a household name but which likewise has some meaning to your employees. The possibilities for this are endless and each company will usually know instinctively who to get.
Some great speakers don’t charge anything for a presentation. Look around locally for any opinion leaders, professionals, and even politicians who would be willing to talk to your sales team about something relative to their profession.
Finding local speakers is also a great way to build new partnerships for your business.
It’s a great idea to award top performers in front of the entire team and to make a big deal about it. Aside from any financial rewards—such as bonuses—you might want to offer something symbolic such as an engraved pen, a specially designed plaque, or a crystal trophy. These are not usually expensive.
Your budget will determine how extravagant you’d like to make this. But its potential to drive ROI can be quite high, not only in the individual being awarded, but also in other reps who might feel more driven as a result of the potential recognition.
Will there be a small gift for each attendee? This could be as simple as a card and some chocolates thanking them for attending, or containing a memorable quote from the CEO. A little goes a long way.
Although probably a small cost, it is a cost nonetheless. If you expect attendees to fill out forms or questionnaires at the event, you’ll need to provide pens, and also consider the costs of printing the questionnaire itself.
If your company uses Brainshark, employees can fill out questionnaires in the app.
Will there be entertainment after the event, such as a band, or a DJ? If there will be dancing, are the lighting costs included in the venue’s rental cost?
Planning costs: Total hours required per person to plan the event
Some employees will spend valuable hours of their time planning various elements of the event. These cumulative hours need to be accounted for in the calculator.
This is a tricky one, and each company must decide how to do it for themselves. Some factors to consider are:
- Was the person hired specifically for this task? Then the hours are as simple as dividing their salary by the number of hours spent on this particular event.
- Has the person been pulled from some other activity to plan the event? Is there a loss of income for the activities that they have been pulled away from?
Formula: Planner Salary / Hours spent planning= Cost of SKO planning per planner
If you’re holding a virtual or hybrid event, there will be costs involved with the platform you use, such as virtual event software— more and more of these products are popping up now that virtual events are here to stay.
Unless you’ll be holding training activities at the event, the leading indicators to measure will be few. The primary leading metric will be the number of attendees, and perhaps a few measuring engagement at the event.
As for lagging indicators, here are the primary ones that can be used to accurately establish a sales kickoff’s ROI.