When the CEO of my former company asked me to look into virtual events three years ago, I shouted “Virtual events will never work. Virtual trade shows are a joke. People want to meet face-to-face.” While that rant isn’t why it’s now my “former” company, the comments reflect the sentiment of many in the traditional events business towards virtual events.

Since that time a number of underlying enablers have fueled steady growth in virtual events. The continued increase in available bandwidth, an ongoing stream of new virtual event platforms and the never ending pressure on everyone’s time have driven exploration and testing of virtual events to this point. In my view, however, it’s the current economic crisis that will be looked back on as what triggered the tipping point for adoption of virtual events. With travel budgets decimated, organizations of all kinds both large and small are looking at virtual events as a cost effective replacement to physical meetings.

Serving Basic Attendee Needs

In thinking about where all of this is headed, it’s helpful to review the basic needs fulfilled by events and how traditional events have addressed these needs. The three basic attendee needs served by physical events are education, networking and sourcing products. In general terms, conferences have been the best solution for education, executive summits and awards programs have served the need to network, and trade shows (exhibitions) have served as the primary model for sourcing products and selecting vendors.

How do virtual events in turn address these needs? Virtual event platforms are essentially Web publishing and communications platforms that leverage the unique capabilities of the Web. Current virtual event platforms are either a single Web application or a series of Web applications bundled into a Web interface that allows users to “Learn, Interact and Find.” When utilized individually, these applications have been used by publishers as webinars for education, chat groups for networking and online directories for sourcing products. The Virtual Trade Show platform in turn has offered an integrated platform of all three applications that is leveraged to create a complete experience for readers and a direct connection to readers for marketers.

The central challenge for both b-to-b and consumer publishing companies is determining the right business model for virtual events in their respective market. While organizations as diverse as trade associations, b-to-b media companies and consumer publishers have claimed success with virtual events, everyone continues to evolve and refine their virtual event models in search of incremental profit and ownership of online communities.

A Maturing Market

What’s clear in all markets is that we are exiting the early adopter phase of virtual events and entering the rapid growth phase of this new media form. Its potential for organizing communities and achieving commercial success are yet to be realized. The potential of virtual events will be realized by media companies who are able to optimize audience participation and revenue streams because they have found a way to meet unmet reader needs and created a more efficient way to connect their readers with marketers who want to engage them.

Many marketers are not waiting for media companies to figure it out. The fastest growing segment of the virtual event business is the corporate market where companies from Microsoft to Procter & Gamble are developing their own virtual events to reach customers, find talent and even replace sales meetings. While media companies are in search of incremental profit in this new media form, the corporate market is experiencing immediate ROI in the form of cost savings (sometimes millions of dollars).

More than anything else, it is the rapid adoption of virtual events in the corporate market driven by the current economic crisis that make creating a strategy for virtual events in your company an imperative.

John Failla is CEO of events management and consulting business, Tesoro Events, he can be reached at 914.819.0693 or by email at john@tesoroevents.com.