Calif. Gift Show Changes Hands

Following through on a plan to shed its consumer-focused show portfolio that was put into motion two years ago, dmg world media sold its Tradeshow Week 200 stalwart, the California Gift Show, to Merchandise Mart Properties Inc.

“This final stage of activity puts dmg world media nearer the strategic finish line here in North America,” said Mike Cooke, CEO of dmg world media. “In 2007, we set out to reshape the business to focus more on fast-growing trade markets and less on consumer-based products.”

He added, “We have been successful, thus far, in finding buyers who see great value in these products, which are no longer a strategic fit for dmg world media, but still have great potential in their regional or niche markets.”

California Gift isn't the only show to go. Three Sculptural Objects and Functional Arts events were sold in a management buyout to dmg world media's former COO, Michael Franks, who partnered with Mark Lyman, the SOFA fairs vice president and show director, to form The Art Fair Co. to run them. Terms of neither deal were disclosed.

At the same time, a handful of West Coast and Canadian gift shows run by George Little Management, a dmg world media company – including the Seattle Gift Show, San Francisco Gift Show and Vancouver Gift Show – and several other art and antiques shows were put on the market for sale.

MMPI previously organized four editions of the LA Mart Gift & Home Furnishings Market at the LA Market, which it owns. It collocated the January and July shows with the semiannual California Gift Show, also managed by GLM, according to Joan Ulrich, MMPI's senior vice president.

So, she added, the buy was a natural for MMPI.

“The acquisition of the California Gift Show underscores our belief in the inherent value of Los Angeles as a market destination and our commitment to the gift industry,” Ulrich said. “We are thrilled to offer a comprehensive show at two fantastic locations.”

With the economic downturn taking its toll on the retail sector, MMPI has its work cut out for it when the new combined show opens July 14-20 at the Los Angeles Convention Center and LA Mart.

Last year's January California Gift Show, which ranked No. 144 on the 2009 TSW 200, experienced a significant drop in business this year. Net square footage saw the steepest decline, to 111, 227 net square feet this year from 177,841 net sq. ft. last year, a 37.5-percent decrease. Number of exhibitors fell to 660 from 1,021 last year, a 35-percent decrease, and attendance dipped to 18,052 from 21,000, a 14-percent drop.

Even with the challenges, Peggy Coleman, vice president of marketing for LA Mart, Gift and Home, said, “I think one of the key things we're going to do is make it easier for the buyers.”

In the past, the two shows were run separately, but now that LA Mart, which typically has 100 exhibitors and 15,000 to 17,500 attendees, and California Gift are under the same management, she added, things will run more smoothly.

“We'll have one registration, one directory and seamless transportation,” Coleman said. “The marketing will be very much driving traffic to both locations.”

Ulrich added, “Now, they can look at the market as a whole.”

To keep the transition as smooth as possible, Mark Furlet, vice president and general manager of the LA Mart, said MMPI has retained several members of California Gift's exhibit sales team.

Ulrich added, “(The) sales teams have been inundated with calls because (people) are happy with the new management. The industry can expect a revitalized show.”

The three SOFA fairs are held annually in New York and Chicago, with another launching this year in Santa Fe, N.M.

“For anyone who is interested in art or wants to start a collection, it's like going to a museum,” Franks said.

Richard Mead, managing director of The Jordan, Edmiston Group, Inc., which handled the sale for dmg, said, “A lot of major business-to-business companies are looking at their portfolios right now.”

As a result, he added, dmg has continued its strategy of selling off its business-to-consumer products. Part of that process was dmg's $53 million sale last year of 38 North American consumer home shows to Marketplace Events. “Last year, (dmg) sold its business-to-consumer, and, this year, its regional shows,” Mead said.

He added, “MMPI was an obvious fit for the California Gift Show.”

As for the gift shows still on the block, they, too, all suffered steep declines in the first quarter of this year.

According to Cooke, though, dmg has interested parties, and once those shows are sold off, the company might look to make a few acquisitions of its own.

For now, he added, the plan is to continue to consolidate the company's portfolio and, when an upturn in the economy occurs, if dmg finds the “right product at the right time, we'd be looking at it.”