These are odd times indeed and it’s when we’re under stress that our true nature often shows. That same is true of organizations and that’s often to their detriment because that true nature is often anti-customer. There is an excellent example of this in what’s going on with the SXSW Festival.
If you’re unfamiliar with the South By Southwest festival, or South By as it’s commonly known, this is how it describes itself:
The event has changed in many surprising and meaningful ways since 1987, but at its core, SXSW remains a tool for creative people to develop their careers by bringing together people from around the globe to meet, learn and share ideas.
It’s sort of a spring break for the tech, marketing, film, and music communities and it attracts thousands of people who attend for the connections they might make, for the music they’ll hear, and for the learnings they’ll take away. It’s become a huge deal and passes to the event cost about $1,400 per person for mid-priced interactive badges that last the length of the 9-day festival. It’s an investment, obviously, and that doesn’t include all the spending by agencies and sponsors.
Here is the problem. They canceled the festival over concerns about the spread of the coronavirus and won’t refund attendees and vendors. They’re offering to defer your ticket to 2021, 2022, or 2023, but they won’t give you back the money. Is this in accordance with their stated policies? Yes, it is, but as we began the piece, these are odd times and maybe, just maybe, it’s time for this business to have another think about alienating their customers.
Many agencies have been cutting back their spending as the festival has become too big and unwieldy. I suspect this might anger those who haven’t been cutting back. Airlines have been refunding tickets and Airbnb recently announced that some coronavirus-related cancellations will qualify for refunds under its “extenuating circumstances” policy. Many of the attendees are small business people looking to promote themselves or artists they represent. Tying up this money for at least a year can be a big hit, one that just might put them out of business by the next festival.
On top of all this, the festival company fired 30% of its employees. Insurance won’t cover enough to maintain the full-time staff where it was.
Should a cancellation something that should have been in the disaster plan? You would think so. This didn’t happen overnight. Companies and artists began pulling out of the festival weeks ago. Should the decisions that seem to have been taken about how to handle the aftermath of a cancellation been more consumer and business partner-friendly? Based on the extreme negative responses in both sectors, definitely so. Will SXSW ever recover from this? Time will tell, but the lessons we can learn will be the same. Be customer-centric. The short-term pain leads to long-term gain most of the time.