Challenges and Opportunities

Michael Hughes -- Tradeshow Week, 7/26/2004

Successful event managers see the proverbial silver lining and typically view each challenge as an opportunity. Because events are essentially re-launched every year, this industry is uniquely able to react to industry shifts and turn problems into solutions. With half the year and close to half the decade over, now might be a good time to look at the key issues facing event managers and meeting planners.

Attendance is growing, but a full rebound to pre-2001 levels is still years away for many shows. That's OK since attendee quality, in terms of buying power and influence, has remained strong. The biggest change over the past few years has been that attendees have other ways (i.e., the Internet) to access in-depth information about your exhibitors and your markets. Also, many attendees simply feel they don't need to be at all the key shows every year, as they did 10 years ago. Instead of holding an annual show every year like clockwork, you have to routinely reinvent and re-launch your event.

The appropriate response to the attendance challenge is twofold. First, show producers need to take a page from information technology, financial services and the catalog and retail industries, using marketing technology and tactics to more accurately analyze and target likely attendees. Too many show producers are simply not sophisticated direct marketers, even if the industry is filled with excellent copywriters.

Second, show producers must ask themselves how attending their events can help someone in their job and career trajectory. There's both an art and a science to this. The art is to keep the intangibles of buzz and momentum strong; the science is adding to your educational content and networking offerings.

Tracking event marketing ROI is not easy, but it can be done. There are methodologies, trainers and research companies that can help your exhibitors track and prove ROI. I also suggest using some of your savviest exhibitors with impressive ROI as case studies. You can also train your exhibitors on tracking return on objectives such as press coverage, total number of booth visitors, amount of literature distributed, Web hits following the show, etc. This added training and marketing effort is worth the investment.

If your events are shrinking as exhibitors take less space and lower their sponsorship commitments, you have to ask if this is a problem with your event or a more widespread issue in your industry. If it's a problem with your show, determine if it's due to your attendance demographics or your pricing and total cost of exhibiting — or a combination. If it's your industry, then you have the opportunity to modify your event to focus on a related industry sector or niche that is healthier.

Show producers usually receive a little more than one-third of the total exhibitor spending relating to their shows. I sense that the perceived cost of shows is the real issue. Many exhibitors don't understand the pricing model for drayage, for example. First, work with your contractors. Most are very adept at pricing and, of course, some rates can be lowered while revenue can be made up by raising other rates.

Analyze your own space rate and sponsorship pricing. Like most show producers, you have probably been raising your rates by 5 or 10 percent every two years. Look at tiered pricing for different parts of the show floor and raising your rates as you get closer to the show dates. Think about how you would price if you could start over from scratch.

The average industry sector has 47 shows scheduled in 2004, according to the Tradeshow Week Data Book. That's nearly one show per week. Some industry sectors have hundreds of shows. It's interesting that very few exhibitions have a full-on head-to-head competitor. Each industry tends to commit to one key annual show and then a schedule of smaller, regional and niche events. The risk for many show producers is death by a thousand cuts — shows on the margins and new events that focus on small but growing industry sectors.

The best way to deal with this is with better market intelligence. Not only do you have to read more publications and research reports and attend more events, you'll have to do more of your own proprietary research. I suggest that you lean on your industry's most savvy professionals — attendees and exhibitors, as well as other influencers. But beware of "industry leaders," they may be too removed from the real changes happening in their markets. Also, you may get more valuable feedback on trends from your attendees than your exhibitors.

This may be one of the most challenging issues impacting show producers. A significant 48 percent of show managers believe consolidation has negatively impacted their shows. The only way to combat this is to target new markets. If acquisitions in your own right are not an option, then you have to consider migrating your show to cover growing areas of your markets and related industries. That is, expand the definition of the markets you cover.

This is a complex issue because the four entities involved — hotels, housing providers, online hotel discounters and attendees — all have competing interests. One way to work successfully with hotels is to provide as much detail on past hotel booking performance as possible. And, of course, one way to combat attrition issues is simply to refuse to sign any hotel contracts. If you are not happy with your housing provider or are worried about attrition, get a second or third opinion from other providers. New technologies and approaches to housing are popping up on a regular basis.

Most show producers have turned the tactics of event planning into a science. Many successful show producers simply repeat the same tasks at the same time every year — and most of the time the model works quite well. But my sense is that many shows could use a through review of their strategy. Taking the approach that each challenge is in fact a chance to modify your strategy and grow can be liberating. The great thing about exhibitions is that your clients want your shows to be successful — they feel like they are part owners of the event. The hard part is finding out where they want you to lead them.