Could Investment Reform Exhibitor Costs?

Heidi Genoist -- Tradeshow Week, 6/4/2007

In my years at Tradeshow Week I've learned a thing or two about the exhibition industry. One is that it is resistant to change — at least until the people holding the purse strings demand it.

Take statistics reporting, for instance. In the good old days, everybody inflated every number. After all, only the foxes were watching the hen house. Although that problem is far from gone, there's more truthfulness in reporting today than there was 20, or even 10, years ago. Independent audits have yet to achieve industry-wide adoption, but at least verification has become standard practice.

Why? Maybe it's investment by entities outside the industry. Accountants and lawyers introduced the rigors of due diligence, bringing what sources politely call "professionalism" to the good ol' boy world of handshakes and favors.

Here's another thing about the industry I've learned: The rising cost of exhibit services is a real problem.

Based in Las Vegas, I have the luxury of attending at least a show a week. I talk to exhibitors representing companies of every imaginable size and type of business. Most agree the cost of just getting there is getting higher — and they're not happy about it.

But they won't do anything about it, either — at least not as a group. So far, the organized intervention of exhibitor associations seems to have had little impact on the cost of exhibiting.

What they will do is vote with their feet. As one NAB exhibitor told me a few weeks ago, his company used to participate in a dozen or so events each year; now, it carefully selects the two to three most important and most cost-effective.

Of course, this isn't news to most of you readers. Show organizers and some suppliers realize they have to do something to control spiralling exhibiting costs before it's too late.

Just ask anyone in Chicago. Editor in Chief Michael Hart learned on his recent trip there to check out the Natl. Restaurant Assn.'s show just how hard organizers and suppliers have to fight to change exhibitors' perceptions once they've branded a show or city as too expensive. (See "Restaurant Show Over Its Labor Pains," in our May 28 issue.)

But a story in this issue, Rachel Wimberly's news piece about the Champion-George E. Fern acquisition of the Audie Group ("Champion, Fern Buy a Third," p. 1), could stir some hope for a resolution to this problem.

Wachovia acquired stakes in Champion and Fern in 2005, marking the first significant investment in the supplier side of the industry since GES Exposition Services and Exhibitgroup/Giltspur became part of Viad.

The Audie Group deal — along with GES Exposition Services' acquisition of U.K.-based Melville Exhibition and Services and event services and registration provider Corporate Technical Services earlier this year, and the purchase of Marlton Technologies by exhibit design firm Sparks Marketing Group last November— suggests that financial interest in the exhibitor services sector continues.

If investors can succeed in bringing "professionalism" to this segment of the industry, as they did to show management, they will give organizers and venues a formidable ally in the fight to keep exhibitors on the showfloor.

Heidi Genoist is senior editor of Tradeshow Week and editor of TSW Las Vegas. She can be reached at hgenoist@reedbusiness.com.