Behind the Scenes of the (Hybrid) Skift Global Forum 2021

Behind the Scenes of the (Hybrid) Skift Global Forum 2021

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Behind the Scenes of the (Hybrid) Skift Global Forum 2021

Meet the key people that made it happen and learn all about how Skift worked with SpotMe to deliver its exclusive content live to both in-person and online audiences.

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What Lies Beyond the Peak for Virtual Events

By Miguel Neves

While the pandemic forced users across the globe to flock to virtual events, the peculiar context motivating this massive influx of revenue has left virtual event tech vendors struggling as the need for virtual declines. As a result, establishing realistic business expectations for 2022 and beyond is an entirely new and unpredictable challenge.

Virtual event tech vendors have been enjoying record revenue throughout the pandemic. Some vendors reportedly reached hypergrowth, and several companies attracting tens or even hundreds of millions of dollars in funding.

The market outlook remains broadly positive, with some research pointing to the virtual event tech market reaching $24.2 billion by 2028, with a forecast annual growth rate of 12.4 percent.

With the fall event season already in full swing with several in-person events taking place globally, many question the longer-term outlook for virtual event tech vendors. Event professionals responding to our third quarter State of the Industry research point to two-thirds of events being hybrid in the short term. Still, while hybrid events use many of the same tools for the virtual component, the need for these tools is unlikely to be as high.

This big question that virtual event tech vendors will be keen to answer is what their revenue will look like once the dust settles; once they can work out how the Covid cohort will affect their long-term prospects. The Covid cohort is a term used to describe clients who contracted with virtual event tech platforms at the start of the pandemic.

Although the Covid cohort provided a colossal boom in sales for the vendors, this influx of business is likely to represent only a temporary fix for the clients rather than a carefully considered long-term business decision. As a result, revenue coming from this cohort is, at least partially, unsustainable.

Not unexpectedly, there are already signs of a market correction.

The transient nature of the Covid cohort is likely to affect vendors across the board. First, the boom was overwhelming, with many companies struggling to keep up with client orders. Now companies are working to understand what business looks like without a Covid cohort.

ON24 CEO Sharat Sharan mentioned the effects of the Covid cohort when discussing the company’s second-quarter financial results. Sharan highlighted the unprecedented churn and down-selling rates within this group, suggesting that it was at least partially to blame for ON24’s poor stock performance since going public in February of this year.

ON24 relies on enterprise customers for the bulk of its revenue. It offers a recurring subscription model that relies on organizations investing in an in-depth implementation of its software. While ON24’s platform can be used for one-off webinars and virtual events, this is not the primary use case, and it’s not what the company is set up to offer.

Zoom stock is also trading significantly lower than in recent months, although it’s still valued at over three times its pre-pandemic price. While Zoom is not primarily focused on virtual events, its prevalence across the business world and its use as the virtual stage for many events make it highly relevant.

Despite being a public company, Eventbrite’s outlook is quite different as its relationship with the Covid cohort is different. The company’s offering is just as valid for in-person and virtual events, but with its core revenue model based on ticket commissions, it struggled with the lower price of virtual events. However, the recent increase in in-person events brought higher ticket prices and a more positive outlook for Eventbrite.

How the Covid cohort affects virtual event tech vendors will depend on several factors. Many companies offer both virtual event tools and mobile technology more commonly used for in-person events. In recent months vendors have started to acquire in-person event technology to offset this shift. Public companies are perhaps more affected, with investors looking down at year-on-year comparisons and bringing stock prices down.

 

IN CONCLUSION

The Covid cohort will impact virtual event tech vendors in different ways. Those that are less reliant on recurring subscription models and enterprise customers may be less affected by the Covid cohort. Still, its effects are likely to be felt across the board. While the sector is confident that virtual event technology will thrive in a post-pandemic world, no one knows for sure what that will look like and when these changes will occur.

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about the author

Miguel Neves
Miguel is EventMB’s Editor-in-Chief and likes to describe himself as a, "curious creator and caring curator of computerized content and a conscious connector of charismatic characters". He lives and breathes the event tech sector and is deeply engaged in the global online community of event professionals. Miguel is a Portuguese soul who built a career in the UK and is now raising a young family in southern Denmark.
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