What’s the difference between an AV company and a production agency?
We get this question a lot. Friends ask us (as event producers) why we do not have a warehouse full of gear. “Couldn’t you make more money if you owned your own gear?” As a production company, we are often referred to as the “AV team” on site for a given event because it is our creative staff that define and manage these critical show positions during the execution phase of an event. However AV suppliers and Production partners are different. Let’s discuss the differences, and when you should consider hiring one over the other.
Using the most basic description, an audio-visual company owns technical equipment and provides specialized labor and staffing for event needs. A production company specializes in event strategy, with expertise in digital communications, multimedia production, and meeting design. Where AV companies should be rated on the actual physical condition of the equipment, knowledge of the AV staff and making sure everything is “plugged in” correctly and on-time, a production company should be vetted on their ability to become an extension of your business, aligning every event detail with your core business objectives.
*Also worth noting, there is a Hybrid of an AV and Production company, where they own their own gear and also offer production services. This type of company came about as a direct result of the recession and clients being asked to do more with less. There are certainly competitive advantages for each, and use-cases for hiring each type of entity.
AV companies have more flexibility for competitive pricing.
AV companies (in-house and outside AV suppliers) have a structured inventory with gear that they usually own in full. This allows them to be more flexible with the pricing they give to an end client, because they can discount their goods and deliverables. After all, it’s better for it to be leaving the warehouse and making some money rather than collecting dust. (You will often see AV houses sponsoring local visitor bureau events, and offering equipment pro bono because they have the gear required for these minimal setups and it is great for name recognition.)
A hybrid company has the added benefit of the one-stop-shop approach. The communication between the production staff and technical staff tends to be strong and they can partner to design a very cost-effective show. The caveat here is the show will be designed around all of the equipment they own.
AV Companies Offer Consistent Gear and Reliable Staff
AV companies usually have full-time employees that become very comfortable with the gear owned by that company. This is absolutely critical for an AV company’s client retention — after all, the job of an AV company is more or less to ensure that all the speakers, lights and video equipment are hooked up correctly and to “press play” on your cue at the right time. The lack of missed cues or hiccups during the show is directly tied to having appropriate staff with a solid understanding of the show equipment, which in turn is directly tied to the perceived value of an event. If this is your main success metric, then a well-vetted AV company with a reliable staff that consistently gets all the gear functioning at the right time is a perfect partner.
Production companies have strategic relationships with a variety of AV companies.
Different AV companies have different specialties based on the technology in which they have invested. Some AV companies have a great supply of LED screens; some have an enormous lighting inventory, and some have great mobile stages ready to hit the road for your next brand activation tour. Some are regional; some are national. Production companies build relationships with a diverse group of AV companies they trust and use their relational equity to help provide a solid value for the client, with the event designed around the client’s business objectives rather than what gear is available from their own warehouse in a given timeframe.
Production companies become an extension of your team.
Production companies have lower employee turnover* and generally establish long-term relationships with a client. This helps the producer have a deep understanding of a company’s preferences and values as well as strategic business objectives that may be part of the overall event performance evaluation. With established insight into a company’s culture and brand personality, there is less time spent in the discovery phase, each event built on a deep knowledge base and reflections of past experiences working together. This saves time during the event ideation / design process because the production team won’t have to create as many iterations before landing on a final design that you love.
Similarly, when the relationship is already established, each project tightens up workflow collaboration. The more events that you work on together, the quicker and more seamless your pre-planning process becomes. Simply put, the right production team can become an extension of your internal events team with a deep knowledge of your company culture and deliver events that are aligned with your company values. For those that design programs that change location year over year, the continuity guaranteed in having a production partner familiar with your program is invaluable.
AV companies are limited by their inventory.
In order for them to be profitable, AV and hybrid companies need to move gear. Early in my career, I worked for several AV companies, and the sentiment was always “ get the gear off the shelf and into a ballroom.” AV houses may offer show design or “production design” as a service, however your general session or event is going to be designed within the limitations of their warehouse inventory list. Of course, great AV partners can “cross-rent” gear from other local AV houses to bring a design to life or during peak busy season, however these do not have the same profit percentages as gear they already own, and these types of hard costs are passed on to the client. With less profit tied to these cross rentals, most savvy AV sales managers/account reps will do what they can to use internal inventory first.
A Production company should be engaged early in the planning process.
This can be viewed as a limitation of partnering with a production company – and not always possible given the short runway of planning certain events. But, a seasoned event producer will want to be involved during the earliest event strategy sessions, so they can listen and ask you guiding questions, determine what larger business objectives are to be impacted, and what kind of message you’re trying to convey to your audience. As a direct result, they can then help sculpt the event with your business objectives in mind. They can custom-create a meeting environment and multimedia experience that will best engage your audience and convey the message you are hoping to deliver.
Although there is no need for an AV partner to be at the table during the initial strategy phase of an event, engaging them sooner rather than later is also best practice in order to lock in the gear needed for your event. Create your AV RFP and do price comparisons early in the planning process, and make changes down the road as necessary.
A Note on In-House AV Suppliers
All of the mergers and acquisitions of in-house AV providers is a hot topic of conversation for our industry right now, and increasingly restrictive contracts leave many event stakeholders thinking they are not even contractually allowed to bring in an outside partner when booking certain hotels/venues, or if they do, they will have to “pay double.” With all of these ongoing acquisitions, there is serious merited concern over inflated pricing that will be left unchecked. Now, there are certain advantages to in-house teams. They will undoubtedly have a deep knowledge of the venue/room capabilities, seamless integration with the hotel, and can stay in direct communication with the banquet and other hotel departments. This is convenient by anyone’s standards. Last minute equipment needs can be sourced quickly, and they are often able to waive costs on exclusive venue services such as power, internet and rigging.
However, it’s important to note that in-house audio visual companies are actually independent (third-party) companies contracted with the hotel. They position themselves as a convenient extension of the hotel generally with an office on-location. In order to secure these contracts with the venue, they have to pay significant commissions. I’ve personally seen commission structures creeping upwards of 60% on everything – equipment and labor related. As a planner with a budget, it might be enticing to think, they are cost-effective, so does it matter? But flexibility on labor hours, pricing, concessions and overall technician skill level suffer as a result. Consider easy math of a 50% commission structure and an hourly rate of $50 for a lead audio engineer. That means for every billable man-hour, $25 goes directly to the hotel as commission, and $25 goes to the in-house AV company. Usually only ~$15 goes to the actual technician, which is simply not going to secure the skill level of a technician you might want for vital roles on your tech team (like your lead audio, video and lighting engineers.)
Probably one of the biggest drawbacks that event planners encounter, is that these in-house companies are most likely servicing a number of other events simultaneously. Unless your event scope is large enough to require the entire venue, then you are just one of several clients for the in-house team on a given day. When you have a question or problem, you often have to track down the appropriate decision maker, and if your session is running live and an issue pops up (as they always do), these dreaded seconds can feel like hours, and cause irreversible feedback on your attendee event surveys.
Savvy meeting planners can negotiate their way out of being contractually tied to in-house providers and avoid exorbitant fees in the process. If this is outside your wheelhouse internally, I suggest finding a reliable partner that can hold your hand through the process.
The Right Application
AV companies AND production companies are both essential to the events industry and are absolutely the right choice for specific scenarios. As a production partner, we often turn down business and suggest our clients go directly to one of our AV suppliers when our involvement is unnecessary. So what do a few of these event scenarios look like?
Let’s imagine that you are responsible for managing a one-day sales training session for one hundred local employees at a downtown conference center. Your agenda includes a morning coffee/breakfast hour, a general session, a lunch keynote followed by breakout meetings, and then everyone will head back to your corporate office to finish out the day. An AV company would be a great fit. You most likely have the bandwidth in your schedule to book the venue, manage catering, F&B, decor, give the AV company an explanation of equipment needs, and keynotes could design and advance their own presentations. You will get a great price and have no problem delivering an event on budget that you’ll be proud to show your boss.
Now let’s say you are responsible for planning this same sales training conference, but it is actually two days instead of one, and the event is being held for 100 local staff with another 100 field reps flying in from all over the country. This is a situation where it might be in your best interest to bring in a local hybrid company. There may be a few scenic pieces and signage elements that need to be created that tie in to the Powerpoint themes. There is more content going in the ballroom with more presenters to wrangle and you are already managing flights, transportation, and overnight accommodations. A hybrid company (one that positions themselves as a production partner that also owns gear) would be a perfect fit to manage the General Sessions / Content Creation and you will be freed up to handle the rest of the event logistics.
Now, let’s imagine you are actually responsible for this same sales training session, but it is now a 3-day conference, with several hundred people. A theme that is on brand with relevant content needs to be developed and integrated into all presentation graphics, signage, and set elements. There are multiple speakers, both from within the organization as well as external keynotes, each with unique presentations that need to be managed during the pre-production process as well as on-site. There will be a remote audience of other field reps and event stakeholders, that need to feel like they are just as much a part of the experience as the people on-site. Evening dinners and off-site entertainment options need to be developed that are appropriate extensions of the event and mirror your corporate values. You are definitely going to need a more robust AV set up, and you feel like you may need some creative video elements to help tie the messaging together. The CEO can not make it to the event, and your boss mentioned it would be nice to have him present remotely before lunch on the first day. Undoubtedly, there is a lot more heavy lifting for you as the internal planner.
**If you find yourself wanting to copy and paste last year’s equipment list in order to make this year’s AV RFP, this is a perfect time to pause and find a production partner that you can trust. Having a true production partner will ensure the best value and the highest production quality – working with the same producer that has immersed themselves in your company culture and business initiatives year-over-year is an added bonus.
If you are a professional in the events industry, (which I’m guessing you are if you read this entire article here to the end), what do you factor into your decision making process when sourcing an AV/production partner? We’d love to hear from you and possibly have you on an upcoming Vlog series that we’ll be launching soon!
Published February 4, 2020