Event organizers everywhere have made the switch to virtual events out of sheer necessity in 2020.
While there are plenty of benefits to hosting online events, there is the issue of monetization. In this article, originally posted by smartmeetings.com, we look at the pros and cons of hosting both free and paid events.
Whether you’re painting t-shirts or juggling balls, our talents have value. Before 2020, we made a living using these talents so the thought of holding a free event can be scary. Are we reducing the perceived value of our talents by giving them away for free? But will people attend if we charge a fee to attend the virtual event?
Read this informative article before deciding on whether to hold a paid or a free virtual event.
To pay or not to pay (for virtual events), that is the question.
And the answer? Well, the debate is ongoing. Event organizers and meeting planners are still exploring how they should monetize their virtual events. But, the question behind paid or free isn’t just a monetization question—it ties into every step of the event marketing journey and has a major impact on long-term event and organizational strategy.
Event marketers promote paid and free events differently. They present fundamentally different value propositions and pain points associated with converting new attendees. From a strategy standpoint, audience expectations are ever-changing and the potential fallout from moving a paid in-person event to a free virtual event is a scary thing to consider.
Fear-inducing as some of these questions might be, let’s take a look at the value behind charging for a virtual event vs. running it for free.
Show me the money, the bread and butter behind paid virtual events. Let’s be real—it isn’t free to run a virtual event and it’s not always feasible to deliver a high-quality digital experience without some upfront cost coverage. The simplest way to offset this cost is to charge an entry fee, especially if your content backs up the cost.
As Dahlia El Gazzar, founder of Dahlia+ Agency, says, “There is a value to your content. If you give it away for free, you immediately reduce the perceived value and will struggle to monetize your content in the future.”
Monetize with attendees
The value behind directly monetizing the audience is two-fold. First, revenue is directly tied to the success of your event marketing. If you have a strong attendee base with high retention rates and lack of direct competition, the event is likely to succeed. Acquisition for your virtual event will be directly related to year-over-year retention and your marketing efforts won’t need to be hyper-successful for the virtual event to be well attended.
The second value behind monetizing the audience directly is revenue scalability. Assuming there is no attendance cap, the potential to scale revenue into perpetuity is based upon the ability to acquire new attendees. In this model, revenue is not tied to single-sale items like sponsorships—it’s entirely based upon the success (or failure) to convert attendees.
Set expectations and create exclusivity
They say your perception is your reality. And they’re right! Charging for an event helps create the sense of exclusivity and value before an attendee ever signs onto your platform. Framing the marketing content accordingly will not only help justify the cost of the virtual event, it also helps demonstrate that the virtual event has content that isn’t available anywhere else!
Charging for a virtual event also tempers expectations going forward. Most of us have pivoted to the virtual side of things out of necessity, not out of a true desire to change. We want a return to in-person and we don’t want to cannibalize our own registrations with a free virtual alternative. For many meeting planners, they see virtual as a temporary stepping stone—it doesn’t make sense to reset expectations and provide their content for free.
And there is the issue of commitment. Garth Jordan, CEO of American Animal Hospital Association, may have put it best. “If it’s free, it’s for me, but I may not show up.”
Delayed gratification—the free model! Going free with your virtual event presents an entirely different proposition than staying paid. Rather than collect cash from attendees, you’re monetizing them through sponsorships. That means you’ve got to meet sponsor expectations first (hint: they want more eyes on them).
Monetize with sponsorship
When you don’t charge your attendees, there’s got to be another way to monetize your event. There are two main schools of thought on how to do this. The first is to focus on your sponsorship sales and generate revenue through a larger overall attendee base. Digital sponsorships are trackable and more flexible than their in-person counterparts—they provide a more cohesive marketing opportunity. And the more attendees you capture, the more your sponsorships are worth!
Monetize with data
The second way to monetize your free virtual event is through your event data. You don’t need to convert a paid attendee right away, sometimes a free option works like a try-before-you-buy. Think of the freemium model we see in the SaaS vertical. Once you’ve captured them as a virtual attendee, it becomes much easier to convert them down the road. The concept involves lowering the barrier to entry, proving the value at a free virtual event and then converting as a paid attendee for a future event.
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The jury is still out on this one. Whether you’re looking for a paid strategy or running a free virtual event, the water remains muddy. Industry experts are still searching for their secret sauce that will help them continue to grow and monetize their event in this world of virtual.
Rachel Stephan, Snoballer-in-chief with Snöball event influencer marketing, suggests starting with the strategic questions. “Ask yourself, ‘What value does my event bring to my stakeholders?’ Once you’ve answered that, communicating it to your audience consistently and clearly should shift the focus from price to perceived value. That is priceless.”
To bring more clarity to the debate, Matchbox Virtual and Snöball are bringing in a team of experts to take sides and duke it out. The Great Virtual Event Debate: Paid vs. Free Virtual Events is coming up on Oct. 2, 2020 from 1-2 pm EST/ 10-11 am PST. The debate teams will break down both free and paid virtual events to help event and association professionals hit the virtual ground running. In the meantime, pick a side and take a stance! Join either #TeamFree, #TeamPaid or #TeamUndecided and get ready for a debate.
Arianna Rehak, founder of Matchbox Virtual described the event this way: “Since so many are simultaneously making decisions around their monetization and delivery strategies, we’ve built this as an opportunity to learn from each other. This session is about bringing together the collective brain to gather perspectives and insight.”
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