For Now, a Battered Pro AV Market Starts Imagining its Future
The Impact Survey is a weekly assessment of pro AV industry trends, attitudes and perceptions in light of the novel coronavirus and COVID-19 pandemic.
- The share of respondents saying they experienced no impact in the last week rose significantly.
- Of those professionals, healthy percentages indicated a resumption of some project work and a boost in business inquiries.
- Virtually no respondents say their companies have shut down completely.
- With a new month beginning, some have pushed back to July their estimates of a turning point.
After a week when AVIXA Market Intelligence’s COVID-19 Impact Survey indicated a plateau in business sentiment, we see hints that companies are eyeing a positive turn. Said one AV provider in the survey fielded April 28-29, “It took several weeks, but we are now actually getting calls from clients who are inquiring about how they can virtualize their events. People are hesitant to pick a date, but they are now willing to talk. Great first step.”
This week, the percentage of AV providers and AV end users indicating that the pandemic has negatively impacted their company’s business declined to 71% and 64%, respectively, down from 79% and 67% last week.
Significantly, it was a comparatively calm week for some AV providers, with 27% reporting no impact from the virus pandemic, up from just 19% saying the same the survey before.
Drilling down into the responses of professionals who say they’ve avoided negative impacts for the week, an increasing share can discern positive developments. Asked for the good news, 35% of AV providers that hadn’t seen a negative impact last week — including 57% of such providers outside North America — indicated they’ve seen projects resuming. Along those lines, 30% of such AV providers — including 61% outside North America — said they’d seen an increase in incoming business inquiries.
Similar goes for end user customers. There was a smaller number indicating no negative effects for the week, but among those, 28% said they’d seen projects resume.
“As with recent weeks, we have continued investigating ways to conduct our regular event production business in light of current social-distancing measures to include 100% remote presentation and limited in-person attendance, mixed with remote features for more guests,” described one AV provider. “With the company having spent so many years in the face-to-face live event space, we are having to find new ways to break personal ground with remote meetings and events that I think is going to have a positive effect in the long run by expanding the services we can confidently offer clients, whether in the current era of social distancing or further into the future when those restrictions are lifted.”
Getting Funding, Keeping the Doors Open
With the United States Congress and governments around the world continuing to rush financial assistance to businesses, companies continue to apply for emergency support. In the latest Impact Survey, 51% of AV providers and 32% of end user respondents said their companies had attempted to get government loans to protect their operations.
According to one AV provider, ”We were fortunate to be able to get in on the first round of PPP [Paycheck Protection Program] Small Business Administration loans. Hopefully, this will provide all the financial breathing room that we will need before delayed projects get going again.”
Said another, “We were able to get some of the PPP to open back up for our staff for two months, which helps us prolong how long we can last without in-person events.”
As we reach something of a pause in the chaos, AVIXA Market Intelligence asked directly about the operating condition of companies:
- 16% of AV providers and 16% of end users said their companies were operating at full capacity.
- 68% of AV providers and 71% of end users indicated operating at reduced capacity.
- 13% of AV providers and 7% of end users said their companies temporarily ceased all operations.
- Only 1% of AV providers and no end users indicated they permanently shut down.
To be sure, some companies are apparently surviving on a shoestring — for example, 17% of AV providers characterized the hit to their revenues in the 91% to 100% range — but virtually none said they’ve closed their doors for good.
Throughout fielding of the Impact Survey, which first opened on March 17, there have been companies minimally affected by the pandemic, including the 16% in this survey operating at full capacity. It will be important to understand the characteristics of AV companies excelling in this time of crisis.
“Our corporate model has been teleworking-based since our inception,” said one AV provider. “Because of this, some customers who have experienced disruption have turned to us to help fill the gaps. Our project load has averaged 20% above full capacity over the past 14 weeks.”
Challenges Persist as Some Timelines Stretch Ahead
We don’t want to give the impression the industry is coming to a clearing. There are still many facing extreme challenges, including 54% of AV providers reporting delayed orders — up from 50% last week — and 49% reporting cancelled projects — up from 44%. Or the 25% of respondents outside North America seeing revenue declines of 91% to 100% — a share of respondents up from 21% last week. Statistically speaking, those increases may be meaningless, based on the weighting of data and declining shares of respondents reporting negative impacts overall. But the underlying impressions they communicate continue to reflect a struggling AV market.
“We’re having big problems,” said an AV provider. “Our company has a 17-year successful history and right now we’re trying to survive.”
According to another, “Sales opportunities are moving very slowing. We are doing more marketing and planning for the future.”
No one knows for certain when that future will start. With the calendar turning to May, a growing share of AV providers (20%) now thinks July will be the month when project work turns around, while 25% still think the turnaround starts in June. End user respondents are pushing out their horizon more significantly, with greater shares predicting a return to projects in August and September (16% and 19%, respectively), and a full 11% of end users now looking ahead to 2021. Such estimates may affect AV providers as they try to create a fresh path toward future work.
Said one AV provider whose company is exploring the new normal, “We are all being forced to look at things in a different way. How do we get good quality audio and video from clients and guests in an at-home environment where we do not have the same level of control over lighting and acoustics? How do we coordinate and engage an audience not physically in the room with the presenters? These are questions we've never (or very seldom) had to ask ourselves before, and once we have answers through research and trial-and-error, these are going to be answers we can provide clients in the future. These were questions we didn't need to ask before, so we didn't — now we need to, and I believe it is going to have a positive impact down the road.”
The next survey results will be released on May 8.
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