Profitable Event Business Models of the Future: Platforms and Networks, Not Products or Services
Watching Barry Libert (who is both a former client of mine and a previous SISO keynote speaker) on this webcast left me quite impressed with how he had segmented business into four distinct models. His thinking caused me to consider the implications for the future of the events business.
Here are the four business models equating with the four ways that Barry believes value is created. I’ve added a parallel comment for the events business:
1) Make something, sell something – Essentially this means create an event and then get attendees and exhibitors to show up;
2) Provide a service: Introduces more flexibility, perhaps through customization of sponsorships or tailoring an event for a particular client, but is still selling something to someone;
3) Create the ability for consumers to serve themselves: This could be interactive, where the customer serves himself to create an experience based on the available ingredients. Perhaps unconferences and other less-structured events fall into this category;
4) Build a platform focused on relationships: As far as I know, in the event market, this has not yet been done. Perhaps the IAEE, SISO and ASAE associations and others (MAGIC) have some experience in having built this? Think LinkedIn or Facebook, where the platform is the business and now companies pay them to leverage their assets and customer base.
The question you may ask is how do I make money doing this?
The bad news is that it probably won’t be possible in the short term, even though you may already be doing many of the necessary things.
Why not? Because we may have abused our email lists with content-free blasts that have encouraged our database to opt-out. Or even worse, we have been branded as irrelevant and our messages are not even being read. In a sea of information and opportunities for networking, the customer may as well have become indifferent to our outreaches. The same might be said for our social media efforts, which may be seen by our customers and prospects as just another broadcast channel for us to get them to buy something.
Barry suggests replacing the idea of customer loyalty with company loyalty, which I take this to mean engaging in actions that evidence our loyalty to customers rather than expecting loyalty from them. If we build these kinds of networks (and we don’t expect to control everything that happens) perhaps supported by a platform in the style of Facebook or LinkedIn, an events business could grow exponentially in a particular market segment.
What are the steps to getting started?
1) Build quality content that is of interest to your targets, and deliver it consistently over time;
2) Allow your customers and prospects (and others who you might consider as indirect customers) to connect to each other through your events, as well as other efforts such as interactive webcasts, local meetups, etc.
3) Build an affinity for people, rather than just targeting personas or groups of people or things. Perhaps this means developing stakeholder champions (similar to The Tipping Point’s ‘connectors’, ‘mavens’ and ‘salesmen’) and focusing on nurturing loyalty from them.
A move to the relationship/platform model will involve giving up control of everything that goes on, as you are essentially developing a community for which you become the facilitator and moderator, but not the arbiter of what happens.
Giving up control has been a tough thing for event organizers to do in the past. But, as I have been saying for the past few years, someone from the ‘outside’ who gets this approach and can pull it off will, at some point, take our business away.
Have you made the right choice on how to move forward?