Periods of intense crisis often lead to innovation, and 2020 is no exception. In the year of the Covid-19 pandemic, the media industry faces a new threat to revenue: the disappearance of in-person events and the need to rapidly pivot to protect revenue.
The cancellations of industry conferences and trade shows between March and May resulted in a loss of at least $2.3 billion in show organizer revenue, according to the Center for Exhibition Industry Research. The total impact to the economy was at least $14 billion.
While that’s true, audiences have shown they are ready to engage with digital communities and premium content. Sponsors and exhibitors also recognize the value of digital data. While the shift in the events model is daunting, it presents new opportunities for subscription-based revenue and memberships and alternative sources of revenue with digital innovation. In fact, media companies may actually have more paths to revenue as they emerge from the crisis.
We work with some of the biggest names in media, entertainment, technology, retail and information services on digital transformation and product development. One thing we do is help them pivot to a virtual events model. That includes improving their conferences sites, and enhancing their digital ecosystem (the technologies that connect their community with content and data).
These companies are redesigning their events to accommodate travel restrictions, social distancing, and new virtual consumers. Virtual events have become a necessity in the near term, whether for trade shows, conferences or entertainment, and they have also become a long-term strategic opportunity for industry leaders. But the solution isn’t just shifting the venue to Zoom. Premium, memorable, and customized experiences are more important in a virtual world.
The future of events
Here is our vision of what the future of events could look like in the coming months and years:
In person and online
The events industry is already pivoting quickly in response to new demands and trends, and the industry will be led by software and data-driven companies that connect people, both in person and digitally. As different areas reopen, physical events will regain their importance. However, in-person events will be only one important part of a continuous conversation with audiences. Value will be provided to the community throughout the year, empowered by digital experiences and engagement.
Value and pricing
The events of the future will deviate from single ticket purchases to membership, tiered access, VIP content, and online certifications and learning opportunities. Post-pandemic events will be multi-platform, multi-device, and simultaneously virtual and in-person. They will be supplemented by micro-events, curated content experiences, and educational and training opportunities.
Data monetization and digital products are critical to future events revenue. By now, every leading company in the world is either a native software and data company. Or, like Fortune, GE, Disney and the NFL, they are evolving to become one. As these companies have found, digitization has the opportunity not just to reclaim lost revenue but to create new revenue sources and diversified revenue streams.
The “digital venue” is unconstrained by scale and opens up new and lucrative opportunities. Those that will succeed in the events space will be the ones who seize the opportunity to build new digitally empowered business models that drive more predictable revenue for events companies, sponsors, and exhibitors.
Consider Fortune’s membership model. Community members pay for different levels of content access, virtual, live events and other networking experiences throughout the year. Fortune hosts exclusive in-person conferences annually, like the Most Powerful Women Next Gen Summit for rising women leaders, which has traditionally featured curated dinners and digital content supporting the event. The company has a similar model for aspiring CEOs.
Fortune also hosts a number of regular, smaller virtual events, by industry and topic. By hosting weekly micro-events for its audiences, Fortune can create over 100 opportunities for sponsorship during a given year. Nothing replaces the value of gathering in person. However, digital venues and premium content support continuous conversation with audiences and create enduring value for sponsors. This is a model that will provide media and events companies with amplified value in the years to come.
Or consider the sports industry. The NFL makes money through ticket fees, certainly. However, it drives a majority of its revenue as a content company. Disney is also inspiring. A consumer pays to attend a Disney movie or gain admission to a theme park. But that same consumer also pays a regular fee for educational tools, online games and digital streaming services. Disney+ exceeded $20 million in revenue in just its first month of release.
As we look to an events future that leverages the power of combining both digital and in-person offerings, companies will profit from data licensing and creating actionable data and sponsorships for audiences curated by demographics, purchasing power, and interest.
Event companies that build valuable micro-communities will thrive. With increased virtualization, there will be a greater need for people to have personalized and premium experiences in digital channels. Companies like Bevy are already capitalizing on this need by helping brands build and scale their digital communities. Bizly has pivoted from helping its clients plan and manage physical events, to planning and managing virtual events. Cameo enables celebrities to deliver personalized messages to fans. Crowdcast hosts interactive, live online conversations at scale.
The future of events will be hybrid. A single physical event will be amplified by data and content experiences, all within one digital ecosystem. This is especially important when we consider younger, digitally native audiences. They are adept at navigating Fortnite, TikTok and Twitch. They are not confined by physical venues and expect seamless digital integration and community. This allows event companies to offer premium access to unique experiences and content.
It’s possible that some things will be lost in the transition – like the spontaneity of an in-person event, running into the right person at just the right time. Companies like Grip are trying to recreate this kind of spontaneity with intelligent event matchmaking software to develop lasting business relationships. It can certainly work: online dating companies have been using similar algorithms for years.
All this being said, the fundamental value proposition of what the events business is has not changed. Organizers still want to monetize the experience. Attendees want inspiring content, and they want to forge the connections that will help them and their businesses grow. Sellers still want to connect with buyers.
But how these goals are accomplished will be different. Leaders will be the ones that understand these emerging trends and transition their models toward digital content, data and design. They will combine big events with curated micro-events. They will work with experienced digital partners to deliver content seamlessly across platforms and channels, and monetize data and insights with machine learning. The digital ecosystems that empower digital content, marketing, and premium experiences across platforms will become a source of competitive advantage.
The media events industry is not out of business. In fact, it is already finding more lucrative, scalable opportunities. The challenge is deciding where to start, because the temptation will be to want to pursue all of these opportunities. The companies that succeed will be customer-focused. They will build for a narrow set of business outcomes. They will experiment. They will have the wisdom to know when to sustain or pivot. And they will manically focus on minimizing the time it takes for them to realize value. With these goals at the forefront, the media events industry could undergo a remarkable transformation.