Great Recreation Rollup

During nearly two decades as a factory representative for manufacturers of recreational vehicles, Tom Gaither spent considerable time "working the aisles" of the country's major RV shows. That enabled him to hit the ground running when he signed on to help Affinity Group expand from Camping World stores, RV magazines and affinity clubs into the consumer show market.

Barely a year after he set out, Gaither has already acquired three show groups. The Affinity Group division, now known as AGI Events, started out with a handful of winter sports shows that came with the purchase of Minnesota-based Ehlert Media.

Last December, AGI added Royal Productions, a Richmond, Va., family firm that produces a dozen boat, home and RV shows in the Southeast. In February, AGI purchased Plus Events, a Las Vegas-based producer of six sporting goods and home and garden shows in Las Vegas, Reno, Nev., and Sacramento, Calif.

But with the goal of up to 150 shows in four or five divisions still on the horizon, Gaither can't slip into cruise control just yet. On the eve of the Spring Pomona (Calif.) RV & Outdoor Lifestyle Show, the longtime RV owner took some time to talk to Tradeshow Week Associate Editor Margo McCall about where AGI Events has been and where it's headed.

Question: What's your secret to finding suitable shows to buy?

Answer: Before we even started on our acquisitions, I did a lot of research, as far as seeing who is out there. I learned quickly that there are regional show promoters, usually family owned, and a lot of these people don't really have an exit strategy for their business. We come along really as an exit strategy, but we always try to keep the managers on. After I found where they were at, I went around the country visiting them at their offices and shows.

Q: Are companies happy to have that exit strategy available?

A: Nine out of 10 show promoters that I've visited have said, "Yeah, let's talk more." There have only been a few who've said, "No, I'm not interested at all."

Q: Do you have much competition?

A: There are people out there who seem to be buying certain types of shows; companies like dmg (world media), which is buying home and garden shows. We are mostly looking for outdoor sports-type shows – the RVs, the boats, the motorcycle kind of stuff – because that's what our forte is with publications. But we don't not like a show promoter just because he does some weird ice fishing show, or something we're not used to. Because obviously, shows are good moneymakers. If we've got a show that's making money, why would we want to cancel it?

Q: Is your goal still for AGI to own up to 150 shows?

A: Our goal is to have four or five regional offices. We're trying to get a good platform of shows together. It will be a mix of RV shows, boat shows, power sports shows and home and garden shows. Once we get a full platform of shows, it will give us more synergies among those different regions. It could also provide a platform for a sponsorship. These RVs and these boats all take trucks. We could provide a truck company with a good sponsorship opportunity. Once we do get national sponsorships, it could bring more attention to consumer shows, which we need.

Q: Will Affinity Group's other businesses help build the shows?

A: We have a lot of toys on our shelf that can enhance an RV show. We have Woodall's directories. We have "RVtoday," the TV show. We have Good Sam Club memberships, Coast to Coast memberships. Once you have an RV, you need something to do with it. We have all the toys that go along with owning an RV. We can bring a lot more excitement to an RV show than a normal promoter.

Q: How do you come up with ideas within the company?

A: Obviously, this new division is not only new to the marketplace, but new to our company. We're really trying to get the juices flowing as to what kind of excitement we can bring to a show. We're just beginning to scratch the surface as far as things we have to offer. Since I have an RV, I know what some of the toys are.

Q: You've said before that Affinity Group's customer database could help drive attendance at events. Has that turned out to be the case?

A: We're just now starting to use our database of names to do an Internet type of campaign or a direct mail campaign. The Pomona show is our first full-fledged Internet and direct mail campaign.

Q: Is it also the first launch?

A: We launched a Minneapolis fall RV and boat show. This is going to be a larger show because it's in a larger market. We have 65 to 70 booths under tents. We'll have a little seminar area. We'll have 12 or 13 RV dealers providing about 150,000 square feet of RVs on display.

Q: Do you have people with launch experience in your organization?

A: We made the acquisition of Plus Events in Las Vegas. Even prior to us making that acquisition, we had contracted with their organization to help manage the show. They're a very experienced team. They've been doing six strong shows in the Las Vegas area for thirty-something years.

Q: Does taking on existing staff make integration easier?

A: Taking on existing staff does make it somewhat easier as far as operation of the shows goes. The shows are still being run by the same people. Obviously, the biggest task is getting all the accounting and human resources acclimated to the new parent company. Our acquisitions so far have been somewhat seamless as far as the shows (go). Nothing has been difficult, but we made these acquisitions right in the heat of show season, and everyone is busy.

Q: Does the staff you acquired have pretty solid relationships with exhibitors and venues?

A: That's why we acquired them. These shows are all local businesses. You buy media locally, and you deal with exhibitors who are local. You've got to keep that local element there.

Q: Will things change for the companies that were acquired?

A: We plan to add more shows to each new office. We'll start new shows like we're doing in Pomona. Since these acquisitions have been made, we've had some shows call us, and some of these have been acquired and will be tucked into regional offices.

Q: What's a fair multiple range for a consumer show?

A: It's much like buying a house. You pay more for the ocean view one than you would for one tucked in the corner neighborhood. It also depends on the assets we're getting with that business and if it comes with people. Not everybody gets the same price. Some show promoters would be more interesting to us if they came with people, because we want an office in that region. Each multiple would be different based on how much we want that acquisition.

Q: Do most of these deals take a while to put together?

A: Yes, lots of talks, lots of interactions. There's usually a get-to-know period. We get to know them, they get to know us. They want to know how it will be when the deal is done. What happens to their people? There are lots of conversations.

Q: Are you always interested in keeping the staff?

A: I think that's one advantage that we do have. We typically look for the whole office. We're not trying to buy half the office or half the shows. We want the whole thing. These owners want to make sure the employees will have a livelihood after they leave. We've been keeping these owners on board to help us, so really there's very little difference they see other than a paycheck coming from a different company.

Q: How are prospects for the industries you cover?

A: The RV industry is still being carried very strongly by the demographics of the baby boomer generation. There really are two distinct segments of the RV industry. The trailer business is still completely on fire. The motor home market has been off because of the gasoline price hikes. The overall RV marketplace is still on the rise. We've just got a little speed bump with these gas prices.

Q: Any plans to expand into RV tradeshows?

A: Anything's possible. The Pomona show in fall has been a tradeshow, and it's still run by the RV Industry Assn. But it's become a retail show. There aren't any trade days left. There's still a good need for an RV tradeshow out west. If the RV industry wanted us to help with a tradeshow, we would be glad to help, but only if they wanted us to.

Q: Have you learned anything interesting about consumer shows?

A: I think (there are problems with) the way some of these venues treat consumer shows. We aren't maybe their biggest customers, but we don't sometimes get phone calls back. We're not looking for any special treatment. Just a call back would be nice.

Consumer shows do provide a lot of revenue to a city – it might not be hotel rooms, but we provide a lot of revenue to these exhibitors. These RV purchases create quite a tax base for these cities, and boats and home and garden shows do the same thing. All these transactions provide business for their cities.