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Economy Size

As smaller shows grow in popularity among cost-conscious attendees and exhibitors, marketers must weight the value of keeping a booth at big events

By Carol Krol

It’s no secret that targeted events have been stealing the spotlight from bigger trade shows during the economic downturn. But the trend seems to be growing, and it may signal a permanent, tectonic shift in event marketing.

“We’ve gone away from the general big shows,” said Brian Ladyman, marketing VP-demand generation and creative services at J.D. Edwards & Co., Lexington, Ky., an enterprise software provider recently acquired by PeopleSoft Inc. “We do some, but it’s certainly not our major thrust. People realize that’s not necessarily the best way to spend your money.”

“Our team doesn’t do trade shows anymore,” agreed Phil Philliou, VP-e-commerce and emerging technologies at MasterCard International, Purchase, N.Y. The group, which previously attended 10 to 12 shows a year, will go to just two shows this year. “We’re highly selective,” he said. Moreover, marketers are paying much more attention to measuring the ROI of the shows in which they participate.” (See story.)

Event marketing spending is down 2.1% among exhibitors for second quarter 2003 vs. a year earlier, according to Tradeshow Week, a Reed Business Information publication. That’s an improvement from the first quarter, when spending was off 4.6% from the year earlier.

Nevertheless, figures from the Trade Show Exhibitors Association paint a gloomy picture. The average show budget was cut 28% from last year, according to TSEA. The 2002 average budget was more than $1.1 million, while this year’s average budget is about $804,000. Show participation was nearly halved: The average exhibitor will participate in 60 shows in 2003 vs. 114 shows last year.

End of mega shows? “Everyone is looking carefully at their budget with even more scrutiny than before, and most companies prefer a focused event,” said Harris Schanhaut, manager-national events at American Express Corporate Services, a unit of American Express Corp.

Targeted and regional events, which save travel costs, are the choice of many marketers looking to maximize return on investment.

Even some “Goliath” shows are behaving more like niche gatherings in a bid to gain back attendance. Comdex, for example, is shunning its reputation for size. “The metric for success isn’t about how big you are,” said Eric Faurot, VP-general manager for Comdex, part of MediaLive International Inc. “It’s about how relevant you are.” (See a Q&A with MediaLive CEO Robert W. Priest-Heck.)

Several changes have been implemented for Comdex Fall 2003. For starters, only IT companies can exhibit. Faurot has refunded $45,000 to ineligible exhibitors so far. Gone are the massage chair and refrigerator magnet marketers, he said.

This year’s Comdex will be divided into seven themes: wireless, digital, Web services, Windows and .NET, open source, on-demand computing and security. “Innovation centers” will be constructed on the exhibit floor for each theme. “Comdex After Dark,” another new feature, includes organized networking events for each of the seven tracks.

Other shows are experimenting with similar tactics. The Direct Marketing Association will introduce five new features at its annual conference this October, including a “networking lounge” on the show floor, “live usability labs” that offer tutorials and an “executive issues track” limited to senior executives.

“We buck the trend as a trade show,” said Matthew Croson, director of communications at Packaging Machinery Manufacturers Institute, Arlington, Va. The nonprofit organization produces Pack Expo, a packaging industry trade show that routinely fills more than 1 million square feet of exhibit space at Chicago’s McCormick Place. It boasts more than 1,600 exhibitors and has sold out exhibit space for the past three years.

Another factor that sets Pack Expo apart, Croson said, is the producer’s ability to add value for exhibitors and attendees. Among other things, PMMI provides help with marketing strategy before, during and after the show, including a promotional handbook and follow-up training Webinars for exhibitors. Other perks include free postcards showing the company name and booth number, tying into PMMI’s show advertising for a consistent look and feel, and free registrations to exhibitors’ top prospects.

Sticking with small Notwithstanding new attractions at big shows, marketers who have shifted to small events seem to be staying put.

“I see companies leaning toward more exclusive, private events,” said American Express’ Schanhaut. He said regional shows, which tend to be more cost-effective, also are increasing. “Companies who attend trade shows are looking at budgets. You’ll see a higher percentage of people attending regional shows. There’s little lost time, no hotel, no air fare.”

Companies also are interested in regaining control as products grow more complex. Michael Westcott, VP-marketing at The George P. Johnson Co., an event marketing agency in Auburn Hills, Mich., said he’s seen an increase in small events in the past six months. “[Marketers] are doing a lot of seminars to get leads in the pipeline,” he said. “As the offerings have gotten more complex and costly, and decisions are more complex, it’s more difficult to have meaningful conversations on the show floor.”

Pitney Bowes last month launched a series of live events, Web seminars and follow-up communications to C-level customers and prospects. “I’d never have gotten that audience at a big show,” said Arun Sinha, Pitney Bowes’ chief marketing officer. “The C-suite never went to the Comdexes. The best way to reach them is independent customer conferences.”

Feedback from the first of its live, targeted event series (which occurred in June) exceeded expectations and may warrant increased spending, Sinha said. “Today, most of our efforts are going towards that type of event.”

Similarly, MasterCard began a series of invitation-only breakfasts in May in several cities. The events enabled customers to speak to senior executives regarding corporate expense solutions. The first of those meetings, which attracted 60 people, generated an excellent response—28 attendees requested further information or meetings.

Exclusivity seems to be working. TechTarget Inc., Needham, Mass., produces live events with a “controlled circulation” model, limiting both attendees and exhibitors who qualify for participation. Exhibitors pay a premium for presence at the industry-specific shows.

TechTarget will produce 10 shows in 2003, and will increase that number to 14 in 2004. “The real magic is the qualification we do of the audience,” said CEO Greg Strakosch. The company declines about 30% to 50% of attendee applications, he said.

Measuring success The move to targeted events demands greater focus on communication with customers and prospects before, during and after an event.

“Going away from the massive show to the more intimate show means your communications have to become more targeted and personalized,” said Rob McLaughlin, exec VP-product and marketing at Aprimo Inc., Indianapolis, a maker of marketing software. Marrying event communication pre-show to increase attendance with a lead-management process during and post-show is critical, McLaughlin said. But, he added, only about 5% to 10% of b-to-b companies have automated that function.

Measurement is crucial to success, said Susan Friedmann, author of “Meeting and Event Planning For Dummies,” which publishes this month, and owner of The Tradeshow Coach, Lake Placid, N.Y. “Once you’ve been to the show, you give the salesperson the leads, but there’s no accountability set up beforehand to make sure the leads don’t fall into a black hole,” she said. “You need to know very precisely, in quantifiable terms, what you want to get out of the show.”

Outsourcing may help, too. For example, BIGfrontier L.L.C., a Chicago-based PR agency, plans and promotes targeted events on behalf of clients. This usually entails a three-month process that includes strategy, securing speakers and a fully integrated program to target prospects before, during and after the show. This may include community Web sites, newsletters and direct mail.

“For what today’s business audience needs—which is live bodies in a room, including influencers and message carriers—you have to have some kind of connection, a long connection, not a wham-bam thing,” said Steve Lundin, managing director at BIGfrontier.

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