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Party Girl

When people ask Andrea Michaels when she plans to retire, given her decades in the events business, she responds: “I plan on dropping dead at an event I’m producing.” In fact, she felt that nearly happened when Michaels’ Sherman Oaks company, Extraordinary Events, produced the Space Shuttle Development Conference at Moffett Field in Silicon Valley in 1999. More than 500 journalists, politicians, NASA administrators and aerospace executives attended, plus five former astronauts. On the final day, a hangar was open to the public with 10,000 attendees. An Extraordinary Events employee based in Las Vegas was in charge, but five days before the event her phone was disconnected and she disappeared. And none of the event planning had been done. For the next week, Michaels and her staff caught only moments of sleep as they coordinated seating, food, security and every detail of the project. Michaels herself had to get a crane to lift the space shuttle, obtain FAA approval for incoming jets laden with VIPs and write speeches. “Everything went letter perfect – it was an amazing event,” she recalled – though she was exhausted from the effort. That 1999 incident about sums up her business. Extraordinary Events’ staff of 15 produce about 150 corporate events each year – and some are very big. Examples include an auto assembly plant opening for BMW of North America LLC in Spartanburg, N.C.; a distributors meeting for Jafra Cosmetics International Inc. in Westlake Village; and an employee holiday party for Go Daddy Group Inc. in Scottsdale, Ariz. While the budgets for such extravaganzas can run as high as $5 million, most Extraordinary Event productions are straight-forward sales conventions, product introductions or press conferences. “They are normally very strategic, with a purpose such as selling a product or informing the media,” she said. “We work with corporations to deliver messages through events.” Psychedelic: A painted Mini Cooper at BMW event produced by firm. Planning for events can start as long as a year in advance, with one or more senior producers to each event, supported by administrative staff. On the ground, the company can hire as many as 500 freelancers for a single event. Typical sub-contractors include security guards, publicity firms, bus companies, set builders, sound and video crews, and food caterers. Robert Abbott, director of corporate communications at Mueller Co., a large manufacturer of fire hydrants in Chattanooga, Tenn., has worked with Extraordinary Events for nearly 30 years. He keeps coming back to Michaels because of her creativity and her skill at managing them in real time. “Who needs event insurance when you have Andrea?” he asked. “She thinks on her feet. During an event, no matter what happens she can fix it.” Recessionary challenges But like other event companies, Extraordinary Events suffered from the recession, which prompted many corporations to cut back on big events. Then, in 2008, when the news media revealed that executives at mammoth New York insurer AIG Inc. took spa trips following a federal bailout of the company, corporations became even more leery of big bashes. That forced Extraordinary Events to cut about a quarter of its staff and the company’s revenue began to tumble. By last year, revenue had fallen by more than half to $4.5 million. In response, Michaels has become aggressive in seeking business. “Most event companies wait for the phone to ring,” Michaels said. “We operate like an advertising agency, telling clients they need to be communicating all the time. We ask how clients can educate, entertain or reward people and then create the vehicle for it.” The recession also had the paradoxical effect of drawing more competition, as many unemployed people decided to jump into the event business, seeing it as an opportunity with low start-up costs. Many work from home, and try to underbid professional firms like hers, only to go out of business when they realize they can’t make money by under-bidding the market, she said. More significantly, foreign countries have lured international companies to hold corporate bashes overseas, taking business away from U.S.-based event planners. “In Asia, you can produce an event for a fraction of the price here,” she explained. “It’s driving business away from the U.S. for international conferences. The only question is the cost of the plane flight.” Extraordinary Events has adapted by staging many of its events overseas, including Mexico, Bahamas, Canada and Brazil. One of its major customer bases is the German automotive industry, including Daimler AG’s Mercedes-Benz brand and Porsche SE. It produces events in Europe for the industry. Gerry Rothschild, board president at the Los Angeles chapter of trade group International Special Events Society, or ISES, said while the entire event industry suffered in the downturn, it hit high-event planners particularly hard. However, he believes the industry has turned the corner. “Things are loosening up and the economy is starting to help us,” he said. He said Michaels is recognized as one of the founding personalities of the event planning industry. “She is always totally in control,” he said. “Historically she is one of the persons who formed ISES. Back when event planning was just becoming a career, she was there.” Rocky start Michaels’ business did not get off to a smooth start. In fact, she has so many war stories about the event business she compiled them into a book called “Reflections of a Successful Wallflower,” which she published two years ago. One of her best stories involves the founding of Extraordinary Events in 1988. Previously, she and a partner had an event agency, but the partners took to fighting and the company dissolved in a nasty split. “I left without a penny and the next day I was sued for $40 million by my former partner,” she said. “There was nothing to take so nobody got anything except the lawyers made out like bandits.” Because her legal situation made contacting former clients risky, she bought membership lists from event industry trade organizations and conducted mass mailings. Soon her phone started ringing. Despite the rough beginnings, Michaels eventually took on a new business partner – her son. Jon Michaels, co-owner and executive vice president, credits his mother with creative genius, but said he has added better organization and more professionalism to the operation. “The company grew because of her hard work, but she was never trained in business,” said Jon Michaels, who holds an MBA. “As a result, the infrastructure was always catching up to the workload. I brought the organization that was sorely lacking.” His mother sees entrepreneurship as solving a series of problems. The big one she now solves for clients is getting people to bond. For that reason, she has steered her company clear of offering social media or other technology-based solutions, favoring the old-fashioned method of face-to-face conversations. She believes her most important skill is honest communication with clients, especially during crises. For example, when the space shuttle event ran into trouble, her toughest phone call was a description of the fiasco to United Space Alliance, the joint-venture between Boeing Co. and Lockheed Martin that sponsored the event. “Never try to hide a problem, just solve it,” she said.

Joel Russel
Joel Russel
Joel Russell joined the Los Angeles Business Journal in 2006 as a reporter. He transferred to sister publication San Fernando Valley Business Journal in 2012 as managing editor. Since he assumed the position of editor in 2015, the Business Journal has been recognized four times as the best small-circulation tabloid business publication in the country by the Alliance of Area Business Publishers. Previously, he worked as senior editor at Hispanic Business magazine and editor of Business Mexico.
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