May 2008 The Battle of the Furniture Marts After nearly 100 years of dominance, High Point’s furniture market was challenged by a new player. Now it’s fighting back. By Linda Seid Frembes
Nearly 100 years ago, a small regional home furnishings market took hold in High Point, NC, and grew into what’s known today as the largest event for buyers and sellers in the furnishing trade. With 12 million square feet of exhibit space spread across 188 buildings that essentially comprise the entire downtown area of this small Southern city, High Point Market (www.highpointmarket.org) is unlike any typical show. Markets held twice annually each attract about 85,000 registrants from 110 countries, with around 2,600 exhibitors.
The show’s success is due in part to its location — a tri-county region that includes a rich intellectual capital of furniture manufacturers, parts suppliers, artisans, designers, and other trades that support the furniture market — and in part to its position as the only game in town.
High Point’s dominance was tested in 2005 when the competing World Market Center (WMC, www.lasvegasmarket.com) appeared in Las Vegas. Real estate developers Shawn Samson and Jack Kashani set out to build a retail furniture mart in Las Vegas and ended up orchestrating the largest trade show launch in U.S. history. In July 2005, the new show attracted more than 60,000 registrants from 83 countries, and showcased 1,250 exhibiting companies (161 international) in 2.5 million square feet of permanent and temporary exhibit space.
What’s at stake in this battle of the furniture marts? U.S. furniture consumption had a market value of $86.4 billion in 2007, according to recent estimates from Aktrin, a market research firm covering the furniture, wood and textiles industries. It’s expected that the industry will get even more competitive as retailers vie for shrinking consumer dollars. In February 2008, the Furniture Buying Index, which tracks consumer furniture buying, dropped a dramatic five points.
To get home furnishings into retail showrooms, buyers from across the globe descend on High Point and Las Vegas, each offering two scheduled shows per year in mostly permanent showrooms. In Las Vegas, manufacturers lease space either for the markets or on an annual basis in showrooms open by appointment throughout the year. In High Point, manufacturers own most of the buildings themselves and keep much the same schedule. Buying organizations and retailers register for access to the markets and spend several days browsing new furniture lines, meeting with manufacturers and, most importantly, buying.
“Until Las Vegas was a viable threat, every showroom in High Point thought the competition was the showroom across the street,” says Keith Koenig, President of City Furniture (www.city-furniture.com), a retailer with 21 furniture stores in South Florida, who has been shopping High Point since the 1970s. “Vegas widened everyone’s view.”
A looming threat The prevailing view is that the WMC in Las Vegas is, in fact, a viable and looming threat to High Point. WMC has steadily grown in attendance, product scope and footprint. According to WMC, 83 percent of the top 100 U.S. retailers attended the Winter 2008 Las Vegas Market in January. If all goes according to plan, WMC will feature more than 12 million square feet of exhibit space in eight buildings by 2012. In essence, WMC will grow to nearly the same square footage as High Point but achieve it in less than 10 years.
The city of Las Vegas offers almost 150,000 hotel rooms, a conveniently located international airport, endless local transportation and 24/7 entertainment options. World-class dining and shopping are available within minutes from every hotel room.
By contrast, High Point — with a population of 86,000 — sits in a tri-city region with Greensboro and Winston-Salem. Hotel rooms, dining options and entertainment are all limited. In fact, many locals leave town during market weeks and rent their homes to visitors.
What’s more, WMC is armed with attendee-friendly amenities like a market concierge who can obtain tickets to area entertainment, free wireless Internet throughout the buildings and outdoor pavilions, an online parking reservation systems, and technology like smartbooth software — a Web-based lead-generation service for exhibitors.
Can High Point continue to maintain its foothold? Some insiders suggest the industry simply can’t support four shows annually. But High Point has no intention of yielding to the young upstart.
Going on the offensive Preserving the status of the show is in the best interest of manufacturers who have invested in showrooms in High Point, and of the economic health of the region. According to some estimates, the show itself has a $1.2 billion market impact twice a year. That level of economic activity has a significant impact on High Point’s local economy, with its median household income just over $40,000.
Notable changes occurred in 2006, starting with a name change from the International Home Furnishings Market to simply High Point Market. Online pre-registration became available using a new database system that could better track attendee information and make for a smoother on-site registration process.
“Our company was very frustrated that the High Point Market wasn’t responsive to the needs of the industry,” says Koenig. “Like improving the touch points with the customers — registration had long lines, and there were different registration points for different showrooms at different times. And heaven forbid if one of our associates didn’t have a badge.”
Also in 2006, High Point hired Brian Casey, a 26-year trade show industry veteran, as President of High Point Market Authority to oversee the marketing and operations of the show. Casey is no stranger to mega shows; he managed the International Home & Housewares Show for 12 years. Casey’s goal was to focus on improving the customer experience and addressing the long-unheeded concerns of buyers and exhibitors alike. “My predecessor had done a lot of good things, but I looked at it from the standpoint of re-engineering the event,” says Casey, whose immediate focus was to improve the market’s messaging and image. “I can’t change the layout of downtown High Point or build new hotels, but I can focus the brand and improve marketing and operations.”
Improving the experience High Point’s 188-building downtown area can be seen as either “charming” or as a logistical nightmare with too few parking spaces and not enough hotel rooms, depending on your perspective. The confusion and frustration for first-time buyers began long before extended waits in registration lines.
The closest airport to High Point is the Piedmont Triad International Airport, a regional airport 15 miles away. Two larger airports, Raleigh-Durham and Charlotte-Douglas International, are located 82 and 85 miles away, respectively. In addressing weaknesses, Casey says, “The closest airport is small, and the hotels are spread out. Our market is the entire downtown area, and we don’t have the infrastructure of cities like Chicago, Dallas or Las Vegas.”
To ease the burden of getting into downtown, Casey and his team implemented a user-friendly ground transportation system. Free shuttle buses are available from all three airports with door-to-door service to the 110 hotels in the tri-city area. During market days, a free shuttle continuously circles the downtown area to bring attendees to every showroom, seminar and event. An additional Go-Anywhere shuttle will take attendees anywhere within a 3-mile radius of city limits, an added perk for attendees who rent private homes in the area instead of staying in a hotel. “The show is definitely more appealing when all the customer touch points are positive,” says Koenig. “Nagging things were enhanced dramatically, like parking, registration, shuttles, and food and drink. The Go-Anywhere bus makes a huge difference.”
“Once they’re here, attendees don’t need to spend any extra money on meals or cabs,” says Casey. Free catered meals are served in showrooms and under the main tent, while free entertainment options abound. At High Point Market’s Spring show held April 7-13, 2008, organizers offered a free concert series that included Kool & the Gang, Cheap Trick and guitarist Robert Cray. “We’ve raised the bar on the quality of entertainment,” Casey says, also noting that style guru Martha Stewart gave a speech on home decorating and her design inspirations during Spring Market.
In addition, Casey has recognized High Point’s need to invest in tools to improve efficiency. High Point now has a revamped, more user-friendly Web site that includes an online planning tool, and the Market Authority sends a map of the downtown area to each attendee. “There’s pressure on us for more efficiency,” says Casey. “People used to spend seven to nine days at market. Today, they’re more efficient at shopping the show. In the future, it may compress to five days.”
Casey and his team have also developed a first-time buyer program, which he likens to an orientation. For “boots on the ground” assistance, the Market Authority hires High Point University design students to work the market as scouts and help first-time buyers navigate the show.
High Point has also implemented a single registration process using a unified database. Per the trade show standard, one badge now gets an attendee into any part of the show. Previously, buyers had to register multiple times at multiple locations since data was not shared across High Point Market showrooms. “We’re not the owners of this show,” explains Casey. “Until recently, most of these showrooms were competing with one another.”
Strategy shift Casey’s efforts also constitute a subtle strategy shift for High Point Market and for the Market Authority. “We have to look at our value proposition to the industry,” says Casey. “Using our database, we’re carefully dissecting each market, repackaging the data and pushing it out to the industry. Our focus on data and information is an effort to be a 52-week-per-year industry resource.”
That also means capitalizing on industry trends, such as the fashion element of home furnishings. Casey’s team developed a showroom design competition that debuted at the Fall 2007 Market. The design competition aims to help retailers with merchandising ideas. Winning designs are photographed and printed into a showcase book (www.highpointmarket.org/IndustryInsights_Reports.aspx).
The Market Authority is also investing in efforts to find new sources of exhibitors from around the world. A first-ever generic prospectus was developed to help potential exhibitors understand High Point Market and the benefits of investing in a showroom there. Casey says that the recent efforts have “probably doubled” its marketing expenditures from previous spending levels.
Perhaps the least subtle change has been the attitude at High Point Market. “Brian has brought a new attitude — an air of hospitality and cooperation — to High Point,” says Koenig, who noted that the show previously had an attitude similar to a government office.
And that new attitude is noticed by long-time exhibitors like George Revington, President of Home Meridian. The company recently consolidated business operations for Pulaski (www.pulaskifurniture.com) and SLF (Samuel Lawrence Furniture, www.samuellawrence.com) into one High Point location. (He also exhibits at WMC.) “The general attitude is much better; it was inward-looking before,” he says. “High Point is a major show to the top 100 retailers in the country.”
The long view With the rise of WMC and the renewed effort in High Point, buyers and retailers are left with the dilemma of attending four domestic buying shows each year. Overseas shows, like those in China, are also becoming more important; thus further stretching a buyer’s time. “What will happen is anybody’s guess. We would prefer two of either rather than four of both. The more we shop, the more diluted it is,” says Koenig. “We’ve reduced our days at market. We can’t afford to be away from the business for that long. Vegas has lots of entertainment, but I’m not going there for the entertainment. In High Point, I can get more work done.”
An ailing economy is still a wild card, too. “Home furnishing has been hit hard in traditional retail stores. There were some bankruptcies this year that are concerning,” Casey says. “In a down economy, the trade show becomes more relevant. Faceto- face marketing lets you see trends and new product introductions. This market isn’t just about selling furniture — there’s a trend component and a fashion component — it’s about creating an ambiance and a space and providing merchandising ideas to attendees.”
High Point is also focused on marketing to new segments like designers and architects, although Casey says it’s too early to tell about new marketing success with different segments. “No trade show stays the same. You have to be in tune with changes in the marketplace,” he says. “The major changes at High Point Market are already set.”
So what’s left to do? “They must continue to improve the customer experience,” says Koenig, who has always considered High Point Market as two of the most important weeks of the year. “They must be global and welcoming, and show some Southern hospitality.”
Linda Seid Frembes is a freelance journalist based in Massachusetts. Visit her at www.frembes.com. Shows at-a-glance Official show name: High Point Market Web site:www.highpointmarket.org Dates: April and October Location: High Point, NC Producer: High Point Market Authority Number of registrants: 85,000 from 110 countries Number of exhibitors: 2,600 exhibitors across a broad product category Net square feet of exhibit space: 12 million in 188 buildings
Official show name: Las Vegas Market Web site:www.lasvegasmarket.com Dates: January and July Location: Las Vegas Owner/Producer: World Market Center Las Vegas LLC Number of registrants: 50,000 from 100 countries Number of exhibitors: 1,500 Net square feet of exhibit space: 5 million on one campus, with new buildings slated to open July 2008 and in the future
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