Opportunities as Well as Challenges

What's on the minds of show management CEOs? A recent survey conducted by Tradeshow Week research found that most leaders, from both association and for-profit shows, were optimistic about the future. But they also face some important concerns.

CEOs tell us they have two primary challenges. One is sustaining attendance quality and quantity, and the other is managing increasing marketing costs.

Competition for attendees' time and travel budgets is also at the top of their minds. As one put it, there are "too many competing events attracting the same buyers."

A few years ago, the concern was with attendance declines. Today, attendance has been growing at a steady rate in many sectors, and the concern has shifted to holding quality attendance levels this year and in the future.

It's interesting that few CEOs brought up the issue of exhibitor ROI. Exhibitor budgets have been growing modestly, and exhibitor ROI seems to be simply a secondary or tertiary concern behind attendance and other issues.

CEOs are more concerned with costs, both their own and those of their attendees and exhibitors. As one put it, the challenge is "containing costs while raising the quality of the experience."

Most of them expect more hotel price increases. Hotel industry analysts say that many major cities simply don't have enough hotel rooms.

While the most common challenge relates to attendance, there was a wider variety of responses to the question of what the greatest opportunities were, which speaks to the general health and strength of the industry. Many CEOs tell us they believe their key opportunity is to pursue something new, be it a market, partner, business model, technology or marketing technique.

The most commonly mentioned opportunity was expanding the scope of events to serve new or related market sectors. This requires analyzing markets beyond a show's traditional niche, and can result in anything from simply adding a new industry segment to the showfloor or conference track, to launching completely new events in a related or even completely new industry.

Related to the trend of expanding market focus is partnering with other organizations and shows. Sometimes this takes the form of a simple marketing partnership and other times this results in a collocation. As one senior executive said, the focus is on "expansion into related industry vertical market segments via third-party partnerships."

The survey results also found that more show producers are interested in launching shows overseas. China in particular is attracting significant interest, not only from leading North American for-profit show producers, but also top associations.

In terms of adding value with new services, increasing sponsorship opportunities and providing custom event services were identified by a few of the CEOs surveyed.

The key to the overall positive outlook is the continued economic expansion in North America and around the world. Shows are closely tied to the state of the economy and how economic trends impact their industry or niche.

One CEO said that the growth of the global economy and the need for global companies to source products and services would ensure that "tradeshows will be an important factor in the future." Another said that consolidation, which is usually seen as a negative for this industry, was helping to make smaller, competing events "less viable."

Adding to the survey responses and based on other recent research, we've seen other trends impacting the exhibition industry:

• Show managers are analyzing city and venue selection more closely, and studying hotel and exhibitor costs in greater depth. Event producers, especially association shows, are also analyzing local and regional demographics surrounding potential host cities with a higher level of detail.
• Associations are professionalizing their show management divisions. Sometimes this follows the retirement of a long-time meeting planner. Facing competition for the first time, an association brings in outside for-profit management companies to run a show.
• On the for-profit side of the industry, we are seeing a healthy mergers-and-acquisitions market and, in general, more risk taking in the form of launching new shows and serving clients more directly, especially exhibitors, with custom event services.

In general, I break the show management industry into three camps. One-third of show producers dominate a growing industry sector and don't really need to innovate. Most conventions and tradeshows in this category don't have a strong head-to-head competitor anyway.

Another third are in competitive markets or industries that are changing rapidly and need to be more aggressive innovators.

Then there is the last group, a diverse number of show producers and organizations who see no reason to do anything much different currently, but still have a sense that industry dynamics and the way companies market and access information may change in the future.