Exhibitions from Inside Out White Paper Updates/Exhibit...Exhibitions From The Inside Out ......

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Exhibitions From The Inside Out

Basic principles for the successful exhibition or convention of the future from the perspective of attendees and exhibitors.

May, 2003

A White Paper By: Skip Cox President Exhibit Surveys, Inc. [email protected]

Copyright © 2003


of 20 Copyright © 2003 Y

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The value of exhibitions and conventions over the last few years has certainly been brought into question. Significant structural changes are taking place in the buying and selling process of many industries making it difficult for some shows to attract enough qualified attendees and to remain relevant to their marketplace. The perceived ROI from exhibiting is lower for a number of reasons including reduced traffic density at some shows and rising costs relative to value received. And more and more companies are producing their own private events which compete with exhibitions and conventions for the marketing budget, but more importantly for attendees.* Couple these trends with the impact of a protracted weak economy (not to mention events like 9/11, the Iraq war and SARS) and it is not surprising the value of exhibitions is being questioned by corporate management, both from the standpoint of exhibiting and sending attendees to exhibitions. But are exhibitions fundamentally at risk of becoming irrelevant? Or do exhibitions have to re-evaluate the fundamental purpose they serve and re-invent themselves in order to meet the basic needs of their customers, i.e., their exhibitors and attendees? The answer obviously lies in the latter of these two questions. Keep It Simple — Principles for Success:

The basic principles for a successful exhibition or convention are simple. The successful exhibition…

1. Delivers highly valued information to all parties attending (e.g., buyers, sellers, those looking for professional development, allied constituents of the marketplace)

2. Provides an environment and forum that fosters and promotes personal interaction for the effective exchange of the information

As simple as these guiding principles are, producing the successful exhibition is complex. Information takes on many forms (e.g., purchasing information, trends, market information, professional development) and the information is delivered in a variety of ways — some of which the organizer controls (e.g., education program, keynotes) and some of which is out of the organizers direct control (e.g., exhibitor on and off floor activities, informal networking at social and hospitality functions). Looking ahead to 2005 and beyond, the successful exhibitions and conventions will be those that follow these two guiding principles.

* See “Growing Your Event in a Rapidly Changing Business Environment” white paper for a discussion of these trends and their impact on exhibitions (www.exhibitsurveys.com/changes/htm).



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A recent study conducted by Exhibit Surveys, Inc. for the Center for Exhibition Industry Research (The Role and Value of Face-to-Face Interaction, October 2002) substantiates that all forms of face-to-face marketing (e.g., exhibitions, private corporate events, mobile marketing, personal sales calls) are more important today than they have been in the past. This goes against conventional wisdom that suggests that the increased use of the Internet, video teleconferencing, conference calls, etc. due to convenience and/or budget and travel restrictions are conditioning buyers and sellers to use and prefer electronic meetings and media to advance the purchasing process. The fact of the matter is both buyers and sellers still highly value face-to-face interaction. The real challenge to the exhibition and convention industry in the future is how to make exhibitions one of the most economical and most effective methods for personal interaction. But in recent years have organizers and exhibitors provided a forum conducive to the effective exchange of information on a face-to-face basis? This white paper examines a number of the issues relating to the effective delivery of high value information at exhibitions. Since both exhibitors and organizers are in control of delivering information, the role both play will be examined separately. Exhibitor Control Over Attendee Value and ROI:

The exhibitor is obviously in control to a large extent of the value attendees obtain from an exhibition, particularly for shows where a large percentage of attendees only visit the exhibits. Considering the high value attendees place on face-to-face interaction, exhibitors control both the amount and quality of information delivered to many attendees. Measurement by Exhibit Surveys, Inc. for major exhibitors across most types of trade shows indicates that the level of face-to-face, or more specifically one-on-one interactions, is declining on a relative basis. Major companies have been more successful in selectively attracting their potential audience because they have become more sophisticated in the use of pre-show and at-show promotion and attention-getting techniques. However, many have not increased (or in some cases decreased) the opportunities for one-on-one conversations or demonstrations. In 1993, the average major exhibitor established one-on-one contact with 67% of their potential audience attracted to the exhibit. The average in 2002 is 62% and it has been as low as 59% in 2000. In general, focus group research of attendees supports this trend. There is often frustration expressed by attendees because there are not enough opportunities for one-



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on-one conversations with exhibitors and/or the quality of the interaction is sub par due to lack of product knowledge, experience in their industry, etc. Focus group research also shows that as attendees move along the purchasing path, the level of specific information they require increases and, thus, the one-on-one interaction with knowledgeable staff becomes more important. Role of Exhibitions in Purchasing:

The CEIR research cited earlier also confirms that attendees use exhibitions to advance themselves along the purchasing path (see Figure 1). About three-quarters (76%) rate exhibitions very or extremely important in becoming aware of new products or vendors, 67% to evaluate and compare products and vendors for future purchase, 50% to narrow all vendors being considered to preferred vendors, and 32% to ultimately make their purchase decision as a result of what they saw. These results are consistent across all major industries. The big advantage exhibitions have over other types of face-to-face (personal sales calls, private events, etc.) is that they are a neutral arena for comparison shopping and making purchase decisions.

Figure 1

Importance of Face to Face at Exhibitions In Purchasing Process

76% 67%

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Awareness Evaluate & Compare

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Source: Center for Exhibition Industry Research, 2002: The Role and Value of Face to Face Interaction Study

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* % of attendees rating exhibitions very or extremely important at each stage



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It should be noted that the statistical trend in lower face-to-face contact is based on the measurement of major or “anchor” exhibitors in shows. Observation of small to medium size exhibitors indicates that they are more focused on using one-on-one interaction in their exhibits, albeit ineffectively at times. Small to medium-size exhibitors are also more likely to have sales related objectives as opposed to branding or marketing communications objectives for exhibiting, i.e., getting the next lead that will turn into the next sale. With these types of sales objectives, one-on-one interaction is the logical tactic for them to use. Many major exhibitors on the other hand have placed much more emphasis on brand enhancement and marketing communications (e.g., messaging) objectives. With these types of objectives, many have used one-on-many tactics like theaters to affect perceptions and communicate their message to as many attendees as possible. This was the trend through a good part of the 90’s, but as the economy has gotten weaker many major companies have moved to short term revenue objectives. Perhaps that is why the level of face-to-face contact increased a little over the last two years from 59% to 62% for major exhibitors. Shows in the future need to be more strongly positioned and documented to exhibitors as an economical sales tool for advancing attendees along the purchasing path, i.e., accelerating the sales cycle. This does not mean that brand enhancement and marketing communications objectives cannot be achieved at exhibitions. It simply means that exhibitors should also be prepared to advance attendees beyond the early stages of the purchasing path which requires quality personal interaction. This is ultimately where the value of exhibitions exist for exhibitors. It will also increase value to many attendees who are using the show to advance themselves along the purchasing path. The CEIR data establishes the role exhibitions play in the marketing mix, i.e., exhibitions are an integral part of the sales function for companies. Yet at least for most major companies in most industries, the exhibiting function is planned, managed and funded only by marketing management. If sales management is involved it is usually only to provide staff for the exhibit and/or to follow-up on leads. If sales management has little or no say in setting objectives, planning or managing the exhibit, they will likely have little ownership in achieving the expected outcome. Any wonder why leads don’t get followed-up? And think about the negative impact on exhibitor ROI if sales management is not involved. Lack of sales management’s involvement in exhibiting among “anchor” companies is a fundamental marketing and structural problem for the exhibition industry. Organizers



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will obviously have little say in who is involved in the exhibit decision-making process of their customers, but it is in the best long-term interest of organizers to have sales management actively involved. The intrinsic value of shows to exhibitors is better aligned with the sales function. Better alignment will result in better ROI for exhibitors and better satisfaction on the part of attendees. Again, organizers, and the industry as a whole, need to position and promote exhibitions as part of the sales process, particularly in today’s economy where companies are focusing on short term revenue objectives. The point of this discussion about the importance of one-on-one interaction in exhibits is that it is the key to driving ROI for exhibitors and value for many attendees. And yet it is a huge part of the information delivery and face-to-face interaction taking place at the show that is beyond the control of the organizer. Many organizers have provided exhibitor training to address this issue, but for the most part these education programs have achieved moderate success at best for a variety of reasons (e.g., low participation, person attending has no authority to implement change, timing or venue issues, etc.). It comes back to the fundamental structural issue mentioned above. Without sales management’s active involvement, the ROI top management is demanding is less likely to be realized. It will also impact attendee value because many attendees are using shows to advance themselves along the purchasing path, and the face-to-face interaction attendees want is more likely to occur if exhibitors value shows as an integral part of the sales process. Sales management understands the value of face-to-face interaction in the sales process. Innovation — The Role of New Product Introductions:

One final point about the exhibitor’s control as it relates to new product introductions at exhibitions is worth noting. Innovation in the form of new products and solutions is essential to the success of shows. It is still the number one reason why attendees visit exhibitions. New product information is, therefore, essential to achieving good value from attending. On the other hand, fewer exhibitors over the last ten years have new product introductions as one of their primary reasons for exhibiting. In general, exhibitors are no longer willing to wait for the next exhibition to introduce their products due to shorter product development cycles, shorter product life cycles or heavier competition. For some companies who deal with major key accounts, new product introductions are often reserved for private showings. Regardless of the reasons, this misalignment



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between attendee expectations and exhibitor objectives not only affects value from attending, but can also affect the overall health and growth of the show. To illustrate the impact of innovation, shows in virtually all industries were impacted positively by technology growth in the 80’s and 90’s, not just the computer and telecommunications shows. Innovation has slowed for many industries presumably due to the economy, but for those industries where innovation has remained strong, the shows representing those industries have benefited. A good example is CES (Consumer Electronics Show) where innovation in consumer electronics products has been strong, and so has their health and growth. Other factors have also contributed to CES’s success (e.g., building new niche markets of attendees) but innovation has played a major role in their success. The implications of all this is that assuming the rate of product innovation increases with improvement in the economy, shows should benefit by default. However, growth in new product introductions at shows will probably still be limited by some of the trends mentioned before (e.g., shorter product development and life cycles, and competition). Considering the importance of innovation to the success of a show, any emphasis organizers put on new products (e.g., new product pavilions) will be beneficial. What exhibitors don’t often realize is that what may no longer be “new” to them is probably still new to a large segment of the attendees. Perhaps the definition of “new” needs to be clarified for exhibitors, i.e., “new to the show”. Organizer’s Role in Delivering Value and ROI:

Exhibitors as Partners:

The role exhibitor’s play in delivering high value to attendees is very significant. Exhibitors are truly the organizer’s partner and one of the primary responsibilities of the organizer is to develop, nurture and maintain these important partnerships. Just as industry partners like the press, associations, and other industry organizations are critical to maintain, so are exhibitors critical as partners in delivering high value information. Maintaining partnerships with major exhibitors is more than delivering the right attendees for them to see, or putting them on an advisory committee. It is giving them a real voice in the direction of the show, particularly as it relates to relevant programming. The major players in the market are generally in tune with the issues, changes and trends affecting the industry.



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Exhibitors are also very aware of the structural changes taking place that are effecting the buying and selling process in the marketplace. Marketplace structural changes are having a dramatic impact on the health and growth of many shows (see “Growing Your Event in a Rapidly Changing Business Environment” white paper at www.exhibitsurveys.com/changes.htm for further discussion). Exhibitors can be a valuable resource in helping the organizer shape the future of the show to be more relevant to the changes in the marketplace. This may mean changing the traditional exhibition model or being more flexible in terms of how companies participate in the event. Does It Always Have to be Floor Space?

Obviously, the revenue model of the traditional exhibition is built on exhibit space rental. For the average exhibition, approximately 70% of all revenue is generated from space sales. However, considering the importance of major industry players to the overall fabric of the show, is it not better to have them actively participate in the exhibition or convention in some alternative way rather than not at all? The bottom line is that major companies are questioning their ROI from exhibiting and the challenge to organizers is how to help these companies leverage their investment. For each company the solution could be different. That’s why partnerships with individual exhibitors are important. For some, they may simply want to maintain their full presence on the show floor, but expect other opportunities for exposure as part of their investment. For others, they may want to reduce or eliminate their presence on the show floor and create their own alternative presence (e.g., educational program, co-locate one of their private events, mobile truck exhibit). Obviously there are some renegade companies already employing these tactics with no revenue benefit to the organizer. Through partnering, organizers are more likely to negotiate alternative participation on a revenue equivalent or near equivalent basis. Ultimately, the exhibitor needs to be considered as one of the many valuable sources of information available to the organizer. The challenge to the organizer goes back to the basic premise established earlier for successful exhibitions. If more companies employ an alternative presence, how does the organizer orchestrate and control the effective exchange and delivery of high value information? Again, it rests in the quality of the partnership. Genuine partnerships will be the only way of setting the proper stage for exhibitors (the focus and parameters for information delivery) and directing or guiding the efforts of exhibitors to be in concert with the rest of the exhibitors and other event activities. If they are not in concert, it will likely negatively impact attendee value and their own ROI.



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Is Bigger Better?

Bigger events are better from a revenue and margin perspective, but are they better from the attendee and exhibitor perspective? The highly successful exhibitions and conventions of the future will in all likelihood be more focused, vertical trade shows that are rich in content (both in terms of formal education and exhibitors relevant to their interests). The likelihood for success is higher simply because it will be easier to meet requirements for delivering high value information for a narrow field, discipline, industry segment or area of technology. Conversely, it will be more difficult for large and/or horizontal exhibitions to be productive and valuable for attendees and exhibitors. This does not mean that large and/or horizontal shows can’t be successful. To be successful organizers of large exhibitions will need to create very well defined vertical segments of their event and support each segment with rich content, a good representation of exhibitors relevant to each vertical segment and make it easy for attendees to “consume” their segments of interest. Some very large shows like CONEXPO/CONAGG have done this and have enjoyed success in terms of delivering high attendee and exhibitor value. Marketplace Knowledge is Essential:

The organizer of the future will need to build a team with extensive knowledge and a deep understanding of the marketplace the show serves. This will be essential for organizers to:

1. Continually refine the focus of the event to remain relevant to the marketplace.

2. Create or direct creation of relevant content.

3. Identify and develop relationships with the key players in the industry. Many of these may become partners who can contribute to the delivery of high value information.

4. Understand the culture of the marketplace so that all activities created and the general environment of the event are appealing, exciting and interesting to the target audience(s).

5. Monitor new product development in each market segment closely. Innovation is a key to satisfying attendee information needs.

6. Monitor general marketplace trends and issues. Take a leadership position in the marketplace as a key source of trends and new information.

7. Identify and learn about segments of the immediate marketplace or industry the event serves plus segments that may be peripheral to the market. Future attendee and exhibitor growth will come from these segments.



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Growing the More Focused Show in the Future:

It will take considerable time and investment to develop and nurture new attendee and exhibitor segments for growth. Growth is unlikely to happen quickly or from any one big segment of attendees due to the proliferation of exhibitions today and the structural changes taking place in the marketplaces most shows serve. Mergers and acquisitions, key account selling, preferred vendor relationships, changing channels of distribution and downsizing are examples of structural changes taking place that are either reducing the potential universe of attendees and exhibitors and/or reducing their perceived need for attending/exhibiting. There is also considerably more competition for attendees and exhibit budgets from private or proprietary corporate events. As Figure 2 illustrates, CEIR research conducted by Exhibit Surveys, Inc. found that 71% of exhibition attendees across all industries also attend an average of 3.3 private events annually. They attend about the same number of exhibitions annually (average of 3.5). Almost half (47%) of companies who exhibit, also hold one or more of their own private events (67% among large companies of 500 or more employees).

Figure 2

Attend / Hold Private Events

Source: Center for Exhibition Industry Research, 2002: The Role and Value of Face to Face Interaction Study

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Private corporate events are rated highly primarily because they are content rich, that is, they provide very high value and specific information to meet the needs of a very vertical audience. This is the lesson to be learned from private events by organizers. Attendees need focused information to meet their needs, regardless of the source of that information (e.g., the exhibits, the educational program, networking activities). The good news of the CEIR data is that attendees who go to both exhibitions and private corporate events place higher value on exhibitions than on private events. At exhibitions they have more opportunities for face-to-face interaction, it is neutral arena for comparison-shopping, and they are more likely to obtain an unbiased perspective on issues, products and solutions of importance. For the exhibition of the future, growth will come for most shows primarily from multiple small niche markets. This is why it is essential that organizers possess a good understanding of the various attendee and exhibitor segments that make up the market they serve as well as segments that are peripheral and related to their core segments. If both attendees and exhibitors are going to realize good value from the exhibition there has to be good alignment between the needs, expectations, interests and objectives of each. For example, are the products or solutions attendees are most interested in seeing well represented on the show floor? This is the most critical area of alignment in terms of driving value for both attendees and exhibitors. From the exhibitor’s perspective, are the types of attendees by title/function, industry or company size that are most important for them to reach well represented among the attendee base? For new segments, the alignment between attendees and exhibitors becomes even more critical. If the exhibition attracts a new segment of attendees with unique areas of product interest, and these products are not well represented by either existing exhibitors or a matching segment of new exhibitors, it will likely result in lower value for attendees. Conversely, this same scenario represents an opportunity for building a new exhibitor segment. Product interest is the best predictive indicator of an exhibitor’s potential for success. If a significant portion of the audience is interested in a particular product category, exhibitors of these products have a high likelihood for success. This alignment process is critical to identifying, growing and retaining new segments. If alignment does not exist for two matching segments (either for a new segment of attendees with a new segment of exhibitors, or one new and one existing segment), the value each segment obtains will likely be negatively impacted.



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Alignment is also an issue for the organizer when planning education or other programming. To satisfy and retain attendees, programming needs to match the needs and interests of each new attendee segment. This alignment process also provides the base of information needed for developing a segmented approach to marketing and promoting the show. Growth from Major Buyer Companies:

Organizers have long realized the value of inviting related industry associations and societies to meet during their exhibitions. This has been a reasonably effective method over the years of building attendee segments. More recently, some organizers have been successful in getting individual companies representing major buyer segments of their audience to hold their department or team meetings in conjunction with the show. The incentive to the department or team usually includes some combination of amenities. For example, the FMI Supermarket Industry Exposition provided meeting rooms and reduced registration fees for any major food retailer willing to register 30 or more attendees. Sixteen major retailers took advantage of the offer in 2002. In 2003, an appointment service was added where retailers could schedule appointments with executives of exhibitors in their meeting rooms. There was very high use of this service. Similarly, at the Material Handling Industry Association's NA 2002 in Detroit, Daimler-

Chrysler held their quarterly NAFTA Production Control Managers Team meeting.

Daimler-Chrysler brought 70 high level buyers to their meeting and the show. MHIA

provided Daimler-Chrysler a meeting room, free registration and access to education.

Daimler-Chrysler participated again in MHIA's ProMat 2003 and have since expressed

interest in the upcoming NA 2004 event.

This approach to growth is slow and requires considerable time resources and effort in

developing the relationships with the buyer companies, not to mention the cost and

logistics of providing amenities. However, they are bringing important buyer segments

to the show.



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Growth From Co-locating Shows:

Co-location of shows is becoming more popular, and quite frankly, is a subject deserving a white paper of its own. But this trend is at least indirectly related to growing exhibitions, albeit not organically, and thus deserves at least a cursory mention. For a co-located event to be successful and benefit all parties, there has to be good alignment between the two shows. More specifically, the attendees to Show A have to have a legitimate interest in the exhibitors of Show B (and vice versa). Otherwise there will be minimal crossover of attendance and the intended benefit of creating more synergism and activity on each show floor is not realized. This is an oversimplification for illustrative purposes, but it gets at the central problem when co-locations are unsuccessful. Unfortunately, few organizers before deciding to co-locate do the analysis necessary to determine the potential for success. In essence, the alignment analysis described earlier for new attendee and exhibitor segments is what is required, except it is done across shows. Measurement of co-located events indicates that a significant number of them aren’t successful from the standpoint of creating more value for attendees and/or ROI for exhibitors. Often one show benefits at the expense of the other. This doesn’t mean that co-location strategies should be avoided as a means of growth. It simply means that organizers should use caution and carefully analyze the alignment of the shows before proceeding. The Association for Information and Image Management (AIIM) and On Demand Printing shows did detailed alignment research of these two events before proceeding with a co-location of the shows. The co-location was a success because there was good audience/exhibitor alignment which resulted in good synergism across the floors of both shows. They also learned from the alignment analysis how best to brand the co-located events and layout the exhibit floor. What Can Be Learned from Healthcare Conventions and Meetings?

Healthcare conventions and meetings to a large extent are insulated from the effects of the economy. But even in good economic times healthcare events enjoy more success than shows in other industries in terms of generally high retention of exhibitors and high repeat attendance (on average 76% of attendees have attended the convention previously — the highest repeat attendance of all industries Exhibit Surveys, Inc. measures).



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The healthcare industry is facing other issues that have negatively impacted their conventions. Generally a high percentage of their attendees are international (sometimes more than 50%), an attendee segment which has been impacted by 9/11. And, like other industries they are facing many structural changes that are impacting the way they do business (e.g., centralized buying by hospital groups, rising healthcare costs, generic drugs, insurance companies’ influence on physician and hospital fees, etc.). Yet, healthcare conventions and meetings continue to thrive compared to other industries. According to Tradeshow Week’s 2002 Medical and Healthcare Show Report, medical conventions had an average increase in professional attendance of 8.2% (-4.3% for all trade shows). The number of exhibiting companies grew by 1.8%. So why do healthcare conventions continue to prosper and what can organizers in other industries learn from for their success? First of all, the healthcare company’s marketing model has traditionally been built on face-to-face interaction with physicians and healthcare professionals. Because of the well-defined market of physicians, clinics and hospitals, healthcare companies have always had good personal sales penetration. Both buyer (physicians and healthcare professionals) and sellers have highly valued this interaction. For the buyer the interaction has been a means of informal education and staying current on new pharmaceuticals, equipment and supplies. For the salesperson it is primarily for marketing purposes, but they are also trained to educate and obtain valuable feedback. For pharmaceutical companies in particular they are educating physicians and getting feedback on efficacy, drug reactions and other problems. One of the primary structural shifts in the healthcare industry is the inability to see physicians and healthcare professionals in the field. In a study conducted by Exhibit Surveys, Inc. for the Healthcare Exhibitors Association (HCEA) in 2002, 25% of primary care physicians at Primed indicated they are seeing fewer sales personnel in their office compared to the previous year (only 16% said more). For pharmaceutical companies this shift is resulting in a reallocation of marketing assets to Direct to Consumer advertising to create brand preference with the end consumer. This structural change is also placing increased importance on the value of conventions and meetings as a means of achieving the face-to-face interaction with physicians they are no longer getting to see in the hospital or physician’s office. The HCEA study documented that physicians are seeing an average of 18 sales people a month for an average of 7.3 minutes each. At Primed, physicians visited an average of 33 exhibits for an average of 7.5 minutes each, of which 4.7 minutes was spent talking to a rep.



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Healthcare conventions and meetings also enjoy success because there is a very compelling need for physicians and healthcare professionals to attend. It is one of their primary sources of obtaining highly valued information (e.g., CMEs to maintain their accreditation, new research, and new pharmaceuticals, supplies and equipment). This type of information is critical to these attendees. They can obtain it other places (local meetings, Internet, etc.), but they continue to attend the major meetings that are the focal point for disseminating this information. Relating the success of healthcare conventions and meetings to the guiding principles for a successful event — creating a forum and environment that fosters personal interaction for the effective exchange of highly valued information — it is clearly evident why healthcare conventions are enjoying success. To some degree the healthcare market has inherent attributes that are conducive to conventions (vital need for current information and traditional high reliance on personal interaction), but all marketplaces have these attributes to some extent. The healthcare conventions can serve as a model for other industries.



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SUMMARY AND CONCLUSIONS The guiding principles for producing a successful exhibition are simple – deliver highly valued information to all constituents of the event and provide an environment and forum that fosters and promotes personal interaction for the effective exchange of that information. It all boils down to providing valued information and opportunities for one-on-one interaction. Using these guiding principles as a beacon will result in an event highly appealing to attendees, the ultimate customers of exhibitions. Sounds simple, but unfortunately many exhibitions and conventions fall short on delivering on the promise of these principles. Organizers and exhibitors are both responsible. For example, some show organizers simply aren’t in-tune with the information needs of their market, or they make it very difficult for attendees to “consume” the information. This is particularly true for shows that have grown rapidly in square footage. Major exhibitors (the anchors) in many cases aren’t fulfilling the implied promise of these principles and attendees are frustrated. Quite frankly, some major exhibitors with all the exciting techniques they use to attract, entertain and deliver messages to their visitors have gotten away from the fundamental attribute of the exhibit – give the visitor the opportunity to talk to a knowledgeable person who can address their specific needs. That is what the visitor really wants. As simple as the concept of these principles are, producing the successful exhibition is complex. Information at an exhibition or convention takes on many forms (e.g., purchasing information, trends, market information, professional development) and the information is delivered in a variety of ways – some of which the organizer controls (e.g. education program, keynotes) and some of which is out of the organizer’s direct control (e.g., exhibitor on and off floor activities, informal networking at social and hospitality functions). Exhibitor Control Over Attendee Value and ROI: Exhibitions in the future need to be more strongly positioned and documented to exhibitors as an economical sales tool for advancing attendees along the purchasing path, i.e., accelerating the sales cycle. As an industry we now have good data to support this claim. Many of the larger exhibitors in the 90’s were placing much more emphasis on achieving brand enhancement and marketing communications (e.g., messaging) objectives than sales related objectives. The tactics employed for marketing communications and branding objectives were often of the “one-on-many” type



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(theaters, presentations, etc), and less one-on-one interaction (individual product demos, conversations with exhibit staff). “One-on-many” tactics are not conducive for meeting the individual information needs of the exhibit visitor who wants to advance himself or herself along the purchasing path. Therefore, face-to-face interaction with a knowledgeable booth person is essential to enhancing attendee value and for achieving a good ROI from the show. Again, it gets back to the essential principles – delivering valuable information face-to-face. The exhibitor to a large extent is in control of the quality of information delivered, particularly for shows where a large percentage of attendees only visit the exhibits. Organizers have met with moderate success in trying to affect the quality of information delivered by offering training to their exhibitors. The real problem primarily for the larger companies exhibiting is a fundamental marketing and structural issue, i.e., lack of sales management’s involvement in the planning, management and funding of exhibit programs. Sales management’s role is essential in providing for the face-to-face delivery of highly valued information (satisfying attendee needs) and achieving a good ROI (generating and following-up on leads), and yet sales generally has no real ownership in the exhibit program. Marketing management usually controls the exhibit function and budget. It is in the best long-term interest of organizers to have sales management actively involved with marketing management in the decision making process. The data supports that the intrinsic value of shows to exhibitors is better aligned with the sales function, and better alignment will result in improved ROI for exhibitors and better satisfaction on the part of attendees. New product introduction by exhibitors is essential to the success of shows. It is still the number one reason why attendees visit exhibitions and is essential to attendees achieving good value. There appears to be less new product development in recent years, probably due to the economy. But during the 90’s when innovation was at a peak, exhibitors were less likely to introduce their new products at shows for a variety of reasons (e.g., shorter product development and life cycles and increased competition make them less likely to wait for the next annual show). Considering the importance of innovation to the success of the show, any emphasis organizers can place on new products (e.g., new product pavilions) will be beneficial. Exhibitors need to understand that what may not be new to them any longer is probably



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still new to a large segment of the attendees. New products should be positioned to exhibitors as “new to the show”. Organizer’s Role: Considering the role exhibitors play in delivering attendee value, exhibitors are truly the organizer’s partner. Developing partnership relationships with the key exhibitors is essential, not just in terms of meeting their needs and delivering qualified attendees, but also giving them a real voice in the direction and programming of the event. The major players in the market are generally in tune with the issues, changes and trends affecting the industry and their customers (attendees). The revenue model of most exhibitions is obviously heavily dependent upon exhibit space rental. But some major companies are questioning their ROI from exhibiting and the challenge to organizers is how to help these companies leverage their investment. Are there alternative methods for them to actively participate with a major presence that may or may not involve exhibiting? Considering the importance of major industry players to the overall fabric of the show it is better to have them participate in some alternative way than not at all. And by partnering with exhibitors, organizers are more likely to negotiate alternative participation on a revenue equivalent or near equivalent basis to exhibiting. Bigger events are generally better from a margin perspective, but are they better for the attendees and exhibitors? The highly successful exhibitions and conventions of the future will in all likelihood be more focused, vertical trade shows that are rich in content. Conversely, it will be difficult for large and/or horizontal shows to be productive and valuable for attendees and exhibitors unless they create well defined vertical segments of the event and support each segment with rich information content, a good representation of exhibitors relevant to each segment and make it easy for attendees to “consume” their segments of interest. Large or small exhibition, organizers will need to build teams with extensive knowledge and deep understanding of the marketplace(s) the show serves. This will be essential to meet information needs. Growth in attendees and exhibitors for most shows in the future will come primarily from multiple small niche markets. In general, for both attendees and exhibitors to realize good value, there has to be good alignment between the needs, expectations, interests and objectives of each. For new growth segments the alignment is even more critical. If, for example, the exhibition attracts a new segment of attendees and there is not a



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matching segment of exhibitors(new or existing) to meet these attendees’ information needs, it will likely result in low value by that new segment of attendees. The alignment process is critical to identifying, growing and retaining new segments of exhibitors or attendees. It can be an arduous process, but strategically it is essential to the health and growth of the show. If alignment does not exist for two matching segments of exhibitors and attendees, value for each will be negatively impacted. Growth in attendance can also come from working with individual companies representing major buyer segments of the audience to hold their department or team meetings in conjunction with the show. The incentive to the department or team usually includes some combination of incentives like free meeting space, registration and/or education. Growth using this approach is slow and requires a lot of sweat equity to build the relationships with buyer companies. The cost per attendee will likely be above average, but if this approach attracts important and high volume buyer segments, it should be worth the added investment. Co-location of two or more independent shows is another growth strategy being employed by organizers today. Measurement of co-located events indicates that a significant number aren’t successful from the standpoint of creating more value for attendees and exhibitors. Often one show benefits at the expense of the other. For co-located shows to be successful and benefit all parties, there has to be good alignment between attendees in one show and exhibitors in the other, and vice versa. Otherwise crossover attendance between the shows will be minimal and synergism in the form of increased traffic density is not realized. Unfortunately, few organizers before deciding to co-locate do the necessary alignment analysis to determine the prospects for success. In the end, the value of exhibitions and conventions for attendees will be based on the value of information received and quality of personal interactions. The value of exhibitions from the exhibitor’s perspective needs to shift from the number of buyers who attend the show or visit their exhibit, to the value and importance of the sales or business interactions that took place. There is obviously a critical mass of qualified buyers necessary to keep exhibitors satisfied, but with the universe of potential attendees for many marketplaces shrinking and lower traffic density at many shows, judging a show’s success needs to be re-positioned on the value of the business and/or sales interactions that took place.



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Exhibitors and organizers need to re-think, and re-vamp, the current exhibition model. Or is it really just getting back to the basics of what has always been the principles of a successful exhibition? If organizers focus efforts on directing and controlling the quality of information delivered, and providing a face-to-face forum that is appealing and fosters the exchange of highly valued information, the result will be a healthy, vibrant and growing exhibition or convention. Looking to 2005 and beyond, the successful exhibitions will be those that follow these two guiding principles.

Exhibitions from Inside Out White Paper Updates/Exhibit...Exhibitions From The Inside Out ......

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