Show & sell – trade show industry
The trade show industry must be the “Wrong-Way Corrigan” of marketing media. In these difficult economic times, with business growth stagnating and other marketing activities reeling from deep budget cuts, the trade show industry continues to march ahead with more and bigger shows, and ever-greater numbers of attenders. And the trend is worldwide.
Why is it that this former backwater of the American marketing mix is now the darling of U.S. marketers and CEOs alike? Could it be that A) Trade shows generate sales, B) Trade shows burnish the corporate image, C) Trade shows are cost-effective? Answer: all of the above, and much more.
How else to explain the phenomena of COMDEX/Fall (Computer Dealers Exposition, an electronics industry showcase), the granddaddy of U.S. trade shows, or Germany’s Hannover Fair CeBIT (a trade show for office and information technology and telecommunications)?
COMDEX/Fall draws more than 100,000 visitors to some 4,000 exhibits spread over more than one million square feet of showroom floor in Las Vegas, Nev. each year. When the event outgrew the available space, COMDEX officials built a one-million-square-foot conference center, but the show continues to grow and spill over into nearby facilities.
While the U.S. boasts a number of other mega-shows–some 200 by last count–that exceed 109,000 square feet of show space, the mighty Hannover Fair CeBIT dwarfs them all. Held in March each year, this giant of computer and telecommunications trade fairs attracts nearly 500,000 paid visitors from 100 nations during its eight-day run. The fair’s importance to marketers is symbolized by IBM’s permanent exhibit, a multi-story spectacle which an industry official estimates cost IBM more than U.S. $500,000 to build. “But their return on the investment is enormous,” the official added. And that’s the bottom line that is attracting corporations, not-for-profit groups, small businesses and government agencies in increasing numbers to trade shows of all types, worldwide, and with widely differing objectives.
Get the job done
IABC member Ed Shiller, president of Shiller & Associates, Inc., Willowdale, Ont., markets his services as PR counselor as well as books and courses on communication, largely through direct mail. But he began exhibiting at the IABC annual international conference held in Washington, D.C. Why? “It offered a very good way for me to meet my exact target audience, the people I want to reach,” he explains.
Joanne Dickinson, Bureau of the Census, Washington, D.C., likes the feedback opportunities at trade shows: “We exhibit at targeted trade and professional shows to maintain a Census Bureau image with the users of our data and to listen to their issues. So it is a complete line of communication for us.”
For Larry Eberle, marketing communication manager at Cadence Design Systems, Inc., San Jose, Calif., trade show participation is a vital element in the company’s marketing communication mix because they have a difficult marketing message to get across: “We sell complex software. With direct mail or advertising, you may bring in a few leads, but you just don’t have the impact that an in-depth demonstration at a trade show has, where you can show what differentiates you from the rest of the pack.”
Eberle also likes the tight focus of trade show selling: “You meet the same type of people you would making sales calls, but they are all in one place. It saves a lot of leg work. And you have the decision-makers as well as the people who will be using the software in the same place at the same time. On a sales call, that might take three different meetings.”
As Eberle suggests, trade show selling is time and cost efficient. According to the Trade Show Bureau, a Denver, Colo.-based research and information agency for the U.S. trade show industry, studies show that the average cost per visitor reached at a trade show in 1989 was U.S. $142 versus the average cost of a sales call of $259. And, the bureau points out, it takes, on average, 4.3 sales calls to close a typical business sale, but only a letter or telephone call to close a qualified lead obtained at a trade show, which amounts to 0.8 of a sales call. Multiply all of this out and you find that sales tallied from sales calls cost $1,114 while trade show selling costs $349 per sale.
Numbers like these have attracted the attention of business scratching for sales in an increasingly competitive arena. As a result, trade shows have become a winner in corporate marketing budgets. Trade show expenditures now rank second behind direct marketing, which may account for the 72 percent growth in the U.S. trade show industry over the past 10 years. Even with hard economic times of late, the industry continues to grow at around five percent per year, when you take into account attendance, exhibit space and number of trade shows.
In the U.S., trade shows are a $70 billion industry with more than 600,000 organizations exhibiting in some 9,000 trade shows that draw upward of 65 million visitors each year. Trade shows range from narrow, niche events with as few as a dozen exhibitors to COMDEX’s mega-event.
A new development, “private label” shows, in which a manufacturer will sponsor its own event for a select list of invitees, is gaining popularity in the high-tech and consumer goods industries. Digital Equipment Corporation, for example, shows its latest products and technology to invited guests. And Coors, Inc. invites its distributors in for a private showing of the company’s new products and services. And as an additional service for its distributors, Coors also invites selected industry vendors in to show off their latest equipment and supplies, such as beer trucks, uniforms and specialty products.
Uncounted are the wide range of franchise shows that travel the U.S. and the many trade and professional association events, such as IABC’s show, that showcase products and services that appeal to select audiences.
Focus on sales
In Europe, where the concept began over 600 years ago, trade shows have traditionally played a larger role in the marketing plans of European businesses. They allocate significantly higher percentages of their marketing budgets to these events than do U.S. firms, and prepare for the fairs with great care. “Europeans take their trade shows very seriously,” says Jane Lorimer, president of the Trade Show Bureau. “People are there to do business.” Top management attends ready to buy and sell goods, introduce new products, find agents and representatives, seek strategic alliances, exchange ideas and information, and determine how they measure up to their international competitors.
Joachim Schafer, president of Hannover Fairs U.S.A, the U.S. office of Hannover Fair CeBIT, recently predicted that the major shows in Europe will become global events, while second-tier shows are likely to have a more European orientation. And unlike in the U.S., where shows are becoming more narrowly focused, European shows will continue to display a comprehensive array of products and services for an entire industry. And now, with the Eastern Bloc countries opening their doors to the West, a new surge of activity is stimulating trade show growth in Europe.
Trade shows are also rapidly gaining currency in Asia. Japan, especially, is making a vigorous effort to compete for trade show business, along with China and Korea.
U.S. firms–historically less active in international markets and trade shows than their counterparts in Europe and Asia–are awakening to the opportunities and challenges that the foreign venues offer, partly in response to suddenly finding overseas competitors on their front lawn, but largely in search of new sales frontiers. According to the U.S. Department of Commerce, approximately 3,300 U.S. companies participated in overseas trade fairs and related events in 1989, a 25 percent increase over 1988.
However, the Trade Show Bureau offers a word of caution to U.S. companies eyeing overseas markets and events: Do your homework first. “There are clear-cut protocols to follow when participating in international shows,” says Darel Hamilton, communication director. He offers this example: “In America it is a good idea for a company’s CEO to contact customer CEOs before a show to invite them to the booth, but in Europe it is not just a savvy marketing technique, it is required, because the presidents and chairmen of your customers will be there and expect to meet you. It would be discourteous not to contact them.” U.S. firms seeking advice and assistance regarding international trade events should contact the U.S. Department of Commerce, their state governments, chambers of commerce, or industry associations, he advised.
Making trade shows work for you
Organizations exhibit at trade shows for a wide variety of reasons, but whatever their purpose, those who get results have a plan, says the Trade Show Bureau’s Lorimer: “It doesn’t matter how wonderful your booth is if you don’t develop a marketing plan, set goals for the event and implement a plan to achieve those goals. I’ve seen prize-winning booths remain empty during a show because the staff didn’t know what to do with the people walking by.”
Experienced exhibitors advise:
1) Start early. “Some companies wait until six months before an event to begin planning and developing their exhibit,” Cadence’s Eberle says, “but I start at least one year ahead.”
2) State your goal. It may be one or more of these: to develop sales leads, test market a new product, position your company and products in the minds of buyers and prospects, gather intelligence about the competition, launch a public relations or publicity campaign, or introduce a new product. Lorimer points out that Gillette and Coca-Cola are among a number of companies that attend trade shows sponsored by interest groups such as the National Association for Advancement of Colored People and the National Urban League to gauge perceptions of their products or their companies. “They ask booth visitors to fill out short survey forms in exchange for a product sample,” she said, “and learn a lot about perceptions, market share and what people think of their products versus someone else’s.”
3) Establish a way to measure success. Lorimer’s advice is to set a target number for sales or sales leads, or consumer feedback on your new product, or a certain number of additions to your mailing list. And, if you get some publicity, tally up the media coverage and compare the free publicity to what it would have cost to buy an equal amount of advertising space. You can do the same with people passing your booth, she adds: “They get about 10 seconds of exposure to your company and product as they walk by. What would those exposures cost in local TV advertising?”
4) Select the right trade shows that provide the best audiences of prospective buyers of your product or service. The Census Bureau’s Dickinson exhibits in over 300 shows in the years leading up to a census, but the venues are hand-picked. She surveys the 13 Census Bureau divisions each year to determine their goals, interests and new programs for the coming year and matches their needs to show opportunities. “We go to trade and professional associations where we know the audience is targeted and will benefit from the information we have,” Dickinson says.
Joanetta Bolden, who is with the communication division at the United Way of America, zeroes in on organizations of communicators, such as IABC and PRSA. She says, “Many of their members conduct United Way campaigns in their own companies. Since we are a resource for them, we target the audience that we work with.”
5) Involve executive management. Get input and agreement on objectives and how you plan to reach your objectives.
6) Develop a compelling exhibit and support materials. Michael Hatch, president of Professional Exhibits and Graphic Services, Inc., Forestville, Md., tells exhibitors, “You have less than five seconds to attract someone’s attention, so relate something that’s important enough to them to make them want to come into your booth and ask for more information.” He recommends a billboard approach: “One large photograph or graphic is more effective than several smaller ones. And a single bold headline will be read more quickly and five times more often than several subheads or blocks of copy. Let your sales people and literature impart all the details … not your exhibit!”
That is the approach taken by Eberle for Cadence’s booth at the Design Automation Conference each year. Invariably, it is a traffic stopper. Emphasizing simplicity and originality, Eberle strives to burn a clear memory of the corporate message into the minds of show visitors. The major attraction of the Cadence booth is a big-screen video. The 1989 booth featured a Gold Quill-winning video based on the feature film Amadeus. It packed the booth and the aisles all around with potential customers. Filmed on location with period costumes, a taut script and humor, the video suggested that a prodigy sometimes equals or surpasses its mentor. Cadence, which ranked second to Mentor Graphics in the design tools industry, cast itself as the prodigy overtaking Mentor. The video tied in with booth graphics and the entire exhibit played upon Cadence’s marketing theme for the year–“Orchestrating IC Design.”
TAM Productions in Milpitas, Calif., produced the video along with a product overview that was shown inside the booth. Susan O’Connor Fraser, president of TAM, says strong visuals are the key: “In a trade show environment, a video needs to be extremely eye-catching so that someone will stop long enough for a sales rep to approach them. The visuals have to be able to stand on their own, because in the confusion of the trade show floor people may not be able to hear the narrative. It has to be entertaining enough for a person to be willing to stop and invest the time to watch it. And keep it short, preferably not more than three or four minutes. You have to be less concerned with communicating a lot of information because it is not a suitable theater for that.”
Once inside Cadence’s booth, prospects may view the product tape or watch one of 13 demos. If they are from out of the country, they are invited to the international desk to meet with multilingual staff who can answer their questions. Featured products are demonstrated on large screens so that larger groups of people can easily see them.
Serious prospects are invited to more detailed demonstrations in Cadence’s 26 hotel suites. “That is where the in-depth selling takes place,” says Eberle. “Our floor activity is simply to get people interested and to leave them with our marketing message. If they walk away with that, we have done our job.”
Eberle doesn’t hand out printed materials at the booth. “We take people’s names and mail the material to them,” he says. “How many people do you know who will go back to their room and read all the material that they collected during the day? We prefer to send it to their office. Our salespeople follow up with a call to see if they received it.”
7) Train the exhibit staff. They are the single most important element in trade show performance. As the Trade Show Bureau points out, in three or four days of a trade show, each staff member can sell to as many as seven times the number that he or she could in the field, and more effectively.
8) Promote your presence at the show well in advance to your customers. Use direct mail announcements to your target customers and take out ads in trade magazines. According to a recent study at the Institute of Food Technologists Food Expo, exhibitors who advertised in major trade publications before the show achieved up to 100 percent greater “stopped booth traffic” than those who didn’t.
9) Work with the sales department to follow up on leads and organize a tracking procedure to trace the effectiveness of the follow-up.
10) Document the business value of leads generated. And appraise the performance of all program elements and the accomplishment of objectives.
Do these things, our experts say, and you will have a successful show.
How much does it cost?
Depending on the show and your corporate pocketbook, trade show participation can cost next to nothing or as much as a half-million dollars, or more. But according to the Trade Show Bureau, the average cost of a booth runs about U.S. $1,000 per linear foot to design and build; space costs around $14.50 per square foot; and shipping, set up and take down adds about $5,000 for a 30-foot booth. All of this adds up to $39,350 for a 30-foot booth, plus travel, meals and housing for the show team.
The show must go on
Suppose you show up at the arena but your booth doesn’t? Don’t scoff. It happens. The Trade Show Bureau’s Jane Lorimer knows from experience: “When I was with Coors, we arrived at a big show, but our booth never got there. So we put up pipe and drapes, rented some carpet and a bar, and put a bucket with a mop and broom in the corner. We hung a sign on the broom handle that said, ‘Our booth didn’t make it, but we are here to serve you and we look forward to talking to you.’ It may seem silly, but it worked. We had more conversations and productivity than usual. So it didn’t matter that our booth wasn’t there; it mattered that the staff was prepared and thinking on its feet.”
COPYRIGHT 1991 International Association of Business Communicators
COPYRIGHT 2004 Gale Group