Show Managers Speak: Small Is Better? Not Always

Staff -- Tradeshow Week, 9/5/2005

When it comes to what constitutes an affordable city for hosting a tradeshow, there are a lot of stereotypes: Small is better than big; the average attendee would never pick Knoxville, Tenn., or Peoria, Ill., over Las Vegas; and drayage is overpriced no matter where you go.

Of course, show managers make the dollars-and-sense decisions everyday to place their shows in the world's largest cities, regardless of the price tag; thousands of people happily attend meetings every year in Knoxville and Peoria; and exhibitors know they've got to put their best foot forward, regardless of how much it costs to unload their booth.

In talking to show managers, we found that picking an affordable city is never an exact science. But that doesn't mean they don't have some interesting opinions on the subject.

• Do you agree with the idea that it's usually more affordable to hold a tradeshow in a smaller city than in a big one?

Birkett: No. In the long run, attracting attendance is the key, and you don't want to exchange short-run cash savings for long-term attendance headaches. Larger markets give you access to a larger base of attendees, and greater airlift and transportation access.

Once many years ago, I worked for a firm, and we launched a new competitive event in a technology market. The show was extremely successful, and it rotated between Boston and Chicago. It virtually closed down a much larger competitive event that had traditionally rotated among small market cities to keep the costs low for exhibitors and attendees. In Boston and Chicago, we had plenty of qualified attendees who didn't need to travel, with the demographics being right for our show attendance.

Hassenstein: I would agree that smaller towns are more affordable, provided they have the scale (flights, hotels and infrastructure) to accommodate the event. If they don't, you end up investing somewhere to overcompensate in an attempt to keep customers (exhibitors or attendees) happy.

Meek: Generally, the costs are the same for the larger cities, but the second-tier cities may be less expensive and often will negotiate to get the business. The supply of space is greater in the second tier and thus the deals are more competitive.

Malone: That's really generalizing. Too much depends (on the region, for instance). If you compared the two within the same region, then yes, in most cases that is probably true.

Burke: For the most part, yes, but not always. The size of the city is not always as important when determining affordability as is the cost of union labor in those respective cities. For example, Phoenix, Dallas, and San Antonio are all larger cities than San Francisco, Detroit and Cleveland, but are typically more cost-effective when it comes to producing shows due to the lower labor rates in these cities. Cities that allow the exhibitor to perform more of their booth installation and dismantle and freight handling will always be more affordable than cities with strict union jurisdictions.

Greenspan: Not necessarily. The four main drivers, in terms of cost, are hall rental, labor, hotel costs and T&E (travel and entertainment) costs. With hall rental, it's not so much an issue of the biggest cities having the biggest price tags, because it depends on other variables — time of year, holes in the schedule the city is looking to fill, promotional packages to subsidize hall rental, how bad the city wants the business. Labor is tied to whether it's union or right-to-work, but you know going in what you're going to be contending with in terms of labor rates. Hotel is in large part like the rental issue, supply and demand basically.

Intangible issues that are not just cost are also part of the value. For certain shows, there is a tremendous benefit to being a big fish in a small pond. Sometimes going to a second-tier city, the costs might not be lower.

• Have you ever held an affordable show in a big city?

Birkett: Affordable in terms of a cheap booth price, no. The big city convention centers are expensive, and we need to cover our costs. But we look at many different issues. It's our job to continue to bring a strong audience to the shows, and to work to hold costs down on behalf of the exhibitors.

Hassenstein: For me, the best of both worlds would be a small to medium-sized town in a right-to-work state like Texas or Florida. For that matter, you can have a show in a fairly large town in this scenario and make it quite profitable.

Meek: Sure, but for us in the business-to-business sector, affordability is not the issue. The issue is the return on the investment the attendees feel they have received. A single small idea garnered from the show can generate significant new revenue, so the cost to attend is insignificant for the serious business person.

Malone: It depends on what you mean by affordable. Within expectations — yes.

One of the key variables in cost is hotels, not just for exhibitors but for attendees also. Rates seem to have really escalated over the past few years in some cities.

Burke: Affordable shows can be run in any city depending upon certain criteria, one being the move-in and move-out of exhibitor freight on straight-time days and hours. If contractor installation and dismantle fall during overtime hours and weekend days, the decorator's cost to produce the show will increase. This increase will be passed on through higher show management rates, as well as higher labor and material handling costs.

• What's an example of an affordable city (big or small) where you've held a show, and what made it affordable?

Ingemie: Las Vegas. It is efficient; popular; easy to get to; and has plenty of great rooms, meeting space and entertainment.

Birkett: We are getting some great rates by holding our event in Washington, D.C., in January. Generally, Washington is considered to be an expensive destination, and our exhibitors are happy to be in a strong market at an affordable time of year.

Hassenstein: San Antonio is a good example of a fairly small or medium-sized town that has hotels, restaurants, a fairly accessible airport, a decent-sized hall and is in a right-to-work state. They are actually nice to you when you show up.

Meek: Las Vegas. Competitive rates at the convention center; supportive unions; a wide price range of hotels, restaurants and entertainment options; and a city that loves tradeshow and convention traffic. Orlando is a good second among large cities, and Memphis (Tenn.), Dallas and Houston are good options among smaller cities.

Burke: Once again, the cost of labor determines affordability. Labor-friendly cities such as San Antonio, Las Vegas, Orlando, Indianapolis, Seattle, Denver, Dallas and Nashville all lend themselves to producing cost-effective shows. Key too, is if the city is on the regular rotation for tradeshows where competition tends to drive down prices and general contractors can easily service the shows. Las Vegas, New Orleans and Orlando all fit this criteria.