As we reflect back in the rear view mirror of 2020 and the impact of the global COVID-19 pandemic, across the majority of many organizations including associations, both core principles and structural norms were tossed around like a row boat in the middle of a tsunami. This includes where in the organization does a revenue growth mindset sit within a traditional mission driven or membership focused conversation.
This past year only provided a fleeting and incomplete snapshot of many association’s revenue challenges as well as a glimpse into exciting new opportunities. Primary revenue sources for many associations of various sizes, membership and non-dues revenue were already challenged pre-COVID-19 and now many are being required to completely relook at all facets of their operations for both short term management, mid-term growth and long term sustainability.
Events as non-dues revenue have included revenue primarily earned from sponsors in the form of vendors, advertising and suppliers interested in reaching a particular industry and community. A smaller percentage was received through registration fees.
The transition from physical/in-person to virtual exposed a broader association business model conundrum of both relying too heavily on membership growth (especially small to mid-size organizations), inconsistent and non-impactful efforts around non-dues revenue, no content strategy and an “one-off approach” to events a couple of times per year that focused primarily on a sponsorship value proposition of booth traffic, networking and low impact sponsored panels and lunches with many lacking both performance metrics and a long tail effect.
Although virtual events are more cost effective to produce than in-person, the time outlay and necessary over-head resources can actually be more, which puts pressure on organizations in this current period of time where many associations have experienced a significant decline in event sponsorship revenue.
Sponsorship Revenue Challenges
Before an overall virtual event revenue goal and strategy can be defined, the realization that the “product” is vastly different including budget, programming, audience experience, engagement, networking and performance metrics – first must be accepted and understood. An ambivalence and reluctance was seen especially early on in the transition when last May in a recent virtual event research report including over 1,000 associations and non-profits by management software company, Wild Apricot, 50% of those surveyed that had already run a virtual event did not even attempt to generate revenue. For the 50% who did, sponsorships came in a distant second (42%) to charging for admission (64%).
For associations like the International Association of Emergency Managers (IAEM), for their mid-November 2020 annual conference it was about managing expectations. States Elizabeth Armstrong, CEO of the organization, “given the unknown nature of the experience and uncertain performance of the technology, IAEM was careful not to overpromise.” Armstrong adds, initially, “we were concerned about our ability to actually drive virtual booth traffic and generate leads for exhibitors.”
“What Got You Here, Won’t Get You There” very much applies to the transition to virtual event sponsorships, which entails going well beyond the obvious “form and function.” Because the content format and audience experience is much closer to TV and digital vs. a hotel ballroom/conference room and a physical exhibit booth, many associations found a drastically different sales and marketing approach to sponsorships was required in order to achieve revenue goals, facilitate client needs and monetize the event.
The approach also might’ve included a different primary client contact whose roles were not necessarily singularly focused on events and trade shows but who had a broader purview of responsibilities and at a more senior management level. Because virtual events now crossover to digital content with a direct and more pronounced impact on a company’s communication strategies, branding and customer demand/lead generation activities, sponsor’s C-Suite execs. are becoming key decision makers (vs. a trade show/ event manager) and this requires a higher level more strategic discussion.
Eric Trabb, Senior Vice President, Business Development at the National Association of Broadcasters (NAB) mentions, “prior to COVID-19 we were already developing a strategic account management approach to our sponsor relationships working directly with C-Suite executives to determine their goals and objectives, learning about their customers and the kind of content environment that is most suitable.”
New Approach and Mindset: More Than A Plug and Play To Do List
In order to effectively monetize virtual events for sponsorships, internally associations first must look at their events and on demand webinars as part of a continuous content strategy together with education and learning and membership communications. An audience journey mapped out across multiple touch points in a continuum throughout the year will provide sponsors more holistic value with targeted members, non-members and partners and include KPIs beyond the virtual event. Added impressions with compatible content will enhance client messaging with greater reach surrounded by enhanced contextual editorial while providing a more rigorous and defined structure for all communications and marketing.
Simultaneously associations’ external communications to clients quite likely needs to be revamped. In addition to a more consultative approach (as previously mentioned), virtual events now need to start selling target audience segments, clearly define event themes, programming sessions beyond a description including speaker content and all with digital metrics for KPIs to determine the established ROI for clients. Associations that have virtually interpreted the exhibit booth floor must now sell in digital connections with enhanced data that is real time accessible and can be automatically leveraged for client lead generation/ demand marketing needs up and down the funnel.
Sponsorship Reset Checklist for Virtual Events (in no particular order)
- Your virtual event is content so make sure to maximize the storytelling, creative narrative and audience connections with a tighter visual and emotional alignment with the event. This could include: sponsored sessions and education tracks with sponsorable video breaks, dynamic lower third on screen graphics for logos, sponsored on-screen contributors, sponsored Q&A time, dedicated live streams, fully programmed short form branded content, sponsored polling etc.
- Package your virtual event with other association assets (incl. social media, e-newsletter, eblasts, podcasts, video etc.) to provide sponsors enhanced value while maximizing internal resources for content development
- Consider tier pricing strategies for different level of sponsorship packages that are reflective of your industry, the marketplace, estimated asset value and projected audience reach
- Explore pursuing fee based and non-fee based event/ session options for potential enhanced audience engagement and actual attendance delivery for sponsors as well as selling the premium cachet of a VIP community (provides additional revenue stream as well)
- Develop client friendly customized virtual events/on-demand webinars demonstrating a higher level partnership beyond a logo/ banner ad and facilitating much more like a co-producer. Trabb of the NAB mentions his team’s biggest success was creating a full program for client, Vertical Bridge (wireless communications infrastructure) that included a customized integrated approach of bringing the sponsor and their existing and prospective customers together to facilitate shared success. He adds “when we can bring buyers and sellers together in a credible environment, everyone wins…including the show organizer.”
- Monetize your virtual event’s extended audience reach for wider sponsor coverage through a selling strategy of going “live” in various international time zones
- Increase interactive components for a higher level of audience engagement such as: polling, gamification etc. At the IAEM, Armstrong’s team significantly upped the level of creativity by developing a digital yearbook as part of the conference’s awards portion that featured photographs of recipients, detailed entries about accomplishments of honorees and resulted in a more meaningful keepsake that could also be used in future years as an opportunity to generate revenue through ads/sponsorships
- Incorporate a broader range of quantifiable metrics into the sales conversation that are directly a part of the sales lead generation process
- When developing sponsorable opportunities specific to your exhibit area investigate thoroughly all tech options connecting buyers and sellers as many are new and have not been fully rolled out as attempts are made to replicate the physical booth experience
- Create a marketing partnership with sponsors that in addition to a paid fee includes the integration of the sponsors’ assets like website, social media, email marketing etc. to cross promote the event
As sponsorships for virtual events posed some of the biggest challenges for many associations in 2020 with many lessons learned along the way, there still will be much trial and error happening this year including with the addition of more hybrid events. A clear eyed evaluation starting at the senior level of the organization needs to occur including discussions on business models and new revenue opportunities for sponsorships as virtual events are clearly quite different than former physical events.
In tandem, with an innovative growth mindset an asset audit (incl. events, video, blogs, images etc.) should be conducted that provides a complete picture of your content inventory.
. Many associations might need an organization reset to meet an increasingly 24/7 sales and marketing cycle. In addition, Elizabeth Armstrong adds that in 2021 IAEM will be focused as well on “educational efforts with clients and invest heavily in helping their exhibitors and sponsors understand ways they can be successful during a virtual event.”