Ofcourse, you now know of Emily Tatanga Kachote and Maison Sere. Are pageants lucrative business models for Zimbabwe or are you better off investing your resources elsewhere?
Mr Ugly, Miss World Zimbabwe, Miss Zimbabwe Tourism, Miss Curvy, Miss Big Matofotofo, Miss Carnival and even Miss Utakataka. Why the barrage of pageants of one sort or another? Marry Chiwenga. Mercy Mushaninga. Kiki Divaris. David Machowa. Peter Moyo. Surely, there must be money to be made by the promoters from these events.
This article is a high level investigation into the pageant business model to determine its economic viability. The profitability of any business model (no matter how complex) can be reduced to the following simplistic equation: Income minus expenses equals profit.
Sponsorships – All business ventures (large or small) want the good publicity that comes with being associated with an attractive, meaningful pageant. The proper strategy is for the promoter to formally engage potential sponsors after finalizing the budget and event profile. Sponsors are invited to finance certain items on the budget after being convinced of what they stand to gain in terms of publicity and promotion of their products and services by supporting the project.
Sponsors are essential to such events! Done properly, they can underwrite or subsidize most of the event’s costs. The promoter can rank sponsors on different levels and offer them different benefits depending on their level of investment. Beauty stores, fashion brands, perfume companies, and anyone that has anything to do with fashion, along with event managers, fashion gurus and hospitality operators are normally engaged as sponsors for pageants.
Registration Fees – Most promoters require aspiring contestants to pay a registration fee. This is usually accompanied with the promise of an relatively extravagant prize package for the winners. In 2013, Miss Grand Zimbabwe requested one contestant to part with US$200. The promise was a trip to Thailand to contest in some global beauty pageant for the winner. The story was covered here.
Cover charges/Gate fees – Pageants also make money from gate fees and charging for tables for VIPs. I know of a Miss Ghetto pageant hosted by some youngsters in Mabvuku which charged $1 per person. Miss World Zimbabwe charged $300 per guest or US$3,000 for a table of 10. Mr Ugly and other bar pageants can have a nominal gate fee, with the expectation that most money will come from bar sales.
The mix and quantum of resource inflow from sponsors, registration and gate fees will depend on the brand and appeal of your pageant to (1) potential sponsors (2) contestants and (3) attendees. Careful structuring of sponsorship deals can take care of up to 100% of budgeted expenses, which increases the chances of turning a profit. However, it is premature for us to discuss the overall profitability without looking at associated expenses and cash outflows.
I have focused on the income side because it is mostly dependent on factors which you cannot control such as the brand, perceptions and appeal of your pageant. You can, however, exercise greater control on the amount and type of expenses you have to pay. It appears that this business strives on achieving a balance between minimizing expenses and being able to make a meaningful investment in achieving the brand identity, managing perceptions and building the appeal that you want. On one extreme we have a Miss Ghetto being hosted at Mabvuku Hall, charging $1 at the gate and with the winner walking away with $50 worth of prizes. On the other extreme we have Miss Zimbabwe with all the bells and whistles, big sponsorships, exquisite venue, live TV coverage, US$3,000 VIP tables and with the winner walking away with a car and modeling deals. You get the picture? Somewhere in between we have Mr. Ugly with their US$500 prize and Miss Curvy with all those Kariba escapades and afterparties etc.
With careful business planning, positive economic profits can be made from pageants. However, the business model relies on sponsorships shouldering the bigger chunk of expenses. In Zimbabwe, most companies are struggling which lessens one’s ability to get meaningful sponsorship. It is a matter of public record that Miss Curvy had to discontinue after some of the promoter’s assets were attached over debts arising from 2013 & 2014 events with most sponsorship deals having gone wrong. Do you remember, Miss Rural Zimbabwe? They also closed shop due to lack of sponsorship. The promoter said, a budget of US$300,000 is required to hold the pageant every year.
It is difficult to profitably run a pageant owing to the harsh economic conditions. The risk of failing to receive adequate sponsorship support magnifies the possibility of making losses year on year. If one is confident of being able to procure meaningful sponsorship, a big budget pageant can indeed be economically viable. Asi #Pakaipa. Big budget pageants may fail to break even in the formative year but as the brand grows, the pageant will become mostly self financing and one can expect to make a profit.
Small budget pageants like Miss Ghetto and Mr Ugly can easily turn a profit. This is because of the limited investment (of time, money and other resources) towards positioning your brand, managing perceptions and building the appeal that you want. Such a pageant will lack the glitz and glamor of Miss Curvy. However, it will be easier to record a profit of some sort because of the small cost base.
You could even build a business focused around hosting numerous of these pageants. After all, you will be in it for the profit, and not the glitz. Right?
I would love to hear your opinion.