June 2006
ROI: At what cost?
Pushed by increasingly sophisticated marketers, show organizers are getting the point that delivering measurable value is essential to growth in attendees, exhibitors and marketplace relevance. While most welcome a new transparency in ROI metrics, these do come at a price for both show organizer and exhibitor. Just how useful are the measures relative to their costs?

By Maxine Golding



Just two weeks after the close of the International Builders Show® (IBS) in January, an exhibit manager already preparing budgets for 2007 called Mark Pursell, Senior Staff Vice President of Marketing and Sales for the National Association of Home Builders (NAHB, www.nahb.org).

The executive making the marketing decisions wanted a slew of demographic information to determine whether the hand-tool manufacturer should participate again. With data in hand, Pursell was able to show not just an increase in leads from the year before, but greater exposure to a wider audience.

Pushed by increasingly sophisticated marketers, show organizers are getting the point that delivering measurable value is essential to growth in attendees, exhibitors and marketplace relevance. Such metrics are especially critical when more than half of senior marketing executives cited event marketing as their lead tactic in EventView ’05/’06 by the MPI Foundation and The George P. Johnson Co. And almost a quarter of the surveyed executives identified event marketing as bringing the greatest return on investment (ROI).
While companies welcome a new transparency in ROI metrics, these do come at a price for both show organizer and exhibitor. Just how useful are the measures relative to their costs?

NUMBERS: Audits and Demographics
Exhibitors look for verifiable data. That’s why large media companies like Reed Exhibitions and CMP Media and non-profits like NAHB have committed to audits as a necessary cost of doing business. “It takes time to work and clean the data, and it’s not inexpensive,” says Leslie Brand, Vice President of Client Services, Business Technology Group Events, CMP Media (www.cmp.com). “The credibility factor, though, is invaluable and justifies the investment.”

At Reed Exhibitions, every show is fully audited by a third party. “I see this as a hygiene factor — either you’re honest about numbers or not,” says John Stuttard, Vice President-International Brand Development, Interphex, Reed Exhibitions (www.reedexpo.com). “The industry needs to adopt something across the board.”

While the cost of an audit is not prohibitive, custom research can raise the bar. A basic audit runs about $5,000 to $8,000, depending on the size of the audience, says Skip Cox, CEO of Exhibit Surveys Inc. (ESI, www.exhibitsurveys.com). Another $2,000 will enable the show organizer to add questions, tables and graphs. A new Event Insights product ESI is offering jointly with BPA Worldwide combines audit and attendee research. It’s priced from $10,450 for shows with fewer than 5,000 attendees to $13,400 for 10,000-plus-attendee shows (online survey). Custom surveys for show organizers start at $10,000 and can rise to $40,000 or higher for very specialized projects.

Is the data worth it? “I look for a targeted audience because total numbers don’t matter for us,” says David Pett, Trade Show Manager for Owens Corning (www.owenscorning.com), whose company wants an audited show that can provide demographic information about buying entities and individuals in attendance.

He points to IBS as “very focused and clear about the audience it markets to and how it helps exhibitors match up with attendees and vice versa. That’s a very good sign it will be a good show for Owens Corning.” With 60 percent of attendees representing this company’s target audience, the show substantiates the decision to exhibit.

Likewise, when the company’s Cultured Stone® division identified restaurants as a market, the National Restaurant Association provided “very good data” about who attends and why they attend. Owens Corning first began to exhibit there in a small way, and 2006 will be its third year running.

For IBS exhibitors, the key metric is density in the aisles — number of bodies per square feet — especially with premium pricing at $36 a square foot. Many tell Pursell they get 30 percent of their orders through the show, so they can’t afford not to be there, yet plenty of “segment” shows draw their interest away. To counter this, IBS spends “a lot of money and effort” not just to audit number of buyers and aisle density, but also to document demographic information on occupation code, product interest and educational need.

ROI measure: Audit number of buyers and aisle density, document demographic information on occupation code, product interest and educational need
Value to IBS exhibitors: High
Cost to IBS: Low to moderate

Audits are not the answer for every show. “Nobody cared,” says Mary Upton, Vice President of Trade Show Operations when the ASI Show (www.asicentral.com) tried official audits for a couple of launches. Instead, ASI verifies attendance at its five shows a year by scanning a stub that people present to get their badge holder, and the badge again as they enter the exhibit hall. And attendees whose badges are scanned at the start and close of show can be reimbursed upward of $130 for one hotel night.

ASI must stage personnel and badge readers at doors to the hall, but “we need these people on site anyway, so it’s not a separate activity,” Upton notes. “To me, it’s the cost of doing business.”

ROI measure: Verify attendance by scanning badge on site
Value to ASI exhibitors: Moderate to high
Cost to ASI: Moderate

Car Care World also sees no groundswell among exhibitors for an audit, even though “we’re always getting hammered” about proving value, notes David Weil, Senior Director, Convention and Trade Show Services, SmithBucklin Corp. (www.smithbucklin.com), which manages the show and its producer, International Carwash Association. “Their expectations match what they see on the show floor.” But given the task to increase market share in business segments, companies are focusing not on sheer numbers, but customized demographic slices including purchasing qualifications.

ROI measure: Customized demographic data including
purchasing qualifications
Value to Car Care World exhibitors: High
Cost to Car Care World: Moderate

PLANS AND CONNECTIONS: Purchasing Intentions and Matchmaking
Interop, recently acquired by CMP, invests considerable dollars in attendee and market segment research that focuses on purchasing involvement and product interests. Value and cost: Moderate.

Specific ROI research shows that three out of four attendees make purchases within six months of the event. Other data indicates that 69 percent visit an exhibitor’s booth as a direct result of viewing it in the program and buyer’s guide, which is referenced seven times a day during the event, and that attendees spend, on average, eight hours on the show floor.

A specific three-part ROI study is designed for the top 20 vendors by size of participation. A pre-show study identifies what they seek to accomplish at the event. At show, Interop rates the attendee experience by focusing on the vendor’s personnel, messaging, and branding. Six months after the event, Interop returns to attendees to learn what purchases were made, from whom they purchased and how helpful the event was to their purchases. Individual reports are delivered to the 20 accounts.

ROI measure: Specific research on attendee experience
Value to Interop exhibitors: Very high
Cost to Interop: Also very high

With its 2005 show, IBS began to hone in on metrics that would show it was more effectively targeting and qualifying individuals for exhibitors. Some were obvious: what products attendees are looking for tied to what role they play in the industry (builder, architect, contractor). Now, the question is how to leverage that information so the right people meet each other on site. It’s not an easy issue to resolve.

“We’ve got 105,000 people, 1,600 exhibitors and 967,000 net square feet of exhibit space, and we’re overbooked on meeting rooms,” Pursell says. “Where can we have them meet?” Still, IBS is committed to facilitating the matchmaking process, as it becomes more important to qualify attendees before they walk into the exhibition.

Clearly, matchmaking has a way to go to realize its potential. But as part of the registration process, it represents only an incremental cost to show organizers, notes Ed Jones, President, Constellation Communication Corp. (www.constellationcc.com).

Exhibitors see the value. A matchmaking service at Reed’s Interphex enables them to comb through pre-registered attendees for those most interested in their products. Instead of 200 leads prior to the show opening, a customer making a tablet pressing machine could find 1,500 to 3,500 leads — “a huge jump and great start,” says Stuttard. “It takes the game into a different league.”

However, Interphex attendees tend to “whip through” registration questions designed to reveal purchasing intentions, their responses not truly accurate to their buying capacity or interest. But as they see matchmaking maximize the show experience with better information prior to the event about companies, products, people and program sessions of high interest to them, about 50 percent of attendees go back online to improve the information about themselves.

And here’s another unexpected benefit for Interphex: 69 percent of pre-registrants attended if they used the matchmaking services, compared to the overall show rate of 56 percent. “That twelve-and-a-half percent improvement is huge,” says Stuttard. “That’s why we need to help exhibitors gear up for this well in advance of the show. If you contact exhibitors two to four weeks out, it’s all about logistics, not marketing. They say, ‘Talk to me after the show.’ ” That’s one missed opportunity.

ROI measure: Matchmaking
Value to Interphex exhibitors and attendees: High
Cost for Interphex: Moderate to low

OUTCOMES: Lead Retrieval and Qualitative Data
More than 900 exhibitors at ASI’s Orlando show are not hung up on buying qualifications. Every one of more than 4,300 distributors must qualify to attend by belonging to ASI or any of 30 regional associations, or identifying companies they buy from for resale. What’s of extremely high value to these exhibitors is lead retrieval.

That’s because an exhibitor in the promotional products industry doesn’t make a sale until a distributor gets an order from a client, often well after the show concludes. Giving out catalogs, samples and kits, then, is key to future sales. So exhibitors scan badges first and ask questions later; lead totals can range from 200 to 1,500 per exhibitor.

Including lead retrieval in the booth package would force ASI to raise booth prices. Instead, ASI leaves the decision to exhibitors whether or not to rent the system, and more than 90 percent opt to do so. Clearly, they judge the cost to be low for the value received. ASI has its own use for floor lead counts: to counter one exhibitor’s complaint when another exhibitor “two doors down receives 500 leads,” says Upton.

ROI measure: Lead retrieval
Value to ASI exhibitors: High
Cost to ASI: Low

Just a one or two-point difference in leads can markedly influence an exhibitor’s perception of a show. Car Care World adds priority points for booth space or sends out a mailing for an exhibitor that provides a customer or prospect list. This exhibitor incentive also aids the show in its regional marketing.

For Owens Corning, it’s critical to understand what happens after the show as a result of its pre- and at-show activities. “If shows can identify outcomes in more detail and report back what the audience told them about how they chose a new vendor or continued to reinforce relationships with existing vendors, that qualitative data would be very valuable,” says Pett.

Many companies, however, still reduce their show participation to a common measure: number of leads divided by the cost of show. Stuttard cautions against this. “One industrial tool company runs a competition that delivers 3,000 to 4,000 leads, but with no bearing on what business they are going to generate,” he points out. “Another company offers giveaways that attract the wrong types of people.” Sophisticated marketers, he suggests, will measure the cost of the show divided by the amount of business generated, even though it may take two to three years to close a piece of business.

And it’s no longer a lost opportunity when a show organizer knows that 3,000 attendees are interested in buying an exhibitor’s product, but only 300 visited the booth. After a show, Reed sifts out these buying prospects and helps exhibitors market to them. “The industry 10 years ago wasn’t knowledgeable about lead retrieval and badge scanning. Now it’s normal,” Stuttard says. “Given another 10 years, we’ll move to RFID (radio frequency identification) systems. It will be a quantum leap from today.”

OUTREACH: Marketing Campaigns, Media Exposure and Research
Owens Corning isn’t particularly concerned about floor traffic data or matchmaking. “What we do will give us the right leads,” maintains Pett. What this exhibitor wants —  as do so many others — is help in reaching its qualified audience in as many ways possible: from pre-show promotions to media and public relations.

Participating in the entire marketing cycle at Interop could mean more than 1 million impressions. But with “events headed towards the ability to drill down to specific people,” Brand cites, Interop launched an “alert” program that takes place a week or two before the event. It segments the registration database by product interest, and pushes out an e-mail with a specific product announcement or booth presentation times for exhibitors. This is low cost and very efficient for moderate value.

ROI measure: “Alert” marketing program
Value to Interop exhibitors: Moderate
Cost to Interop: Low

Costs, though, remain high for exhibitors to print and pay a fee for their promotion to ride with a show’s marketing materials. But such traditional activities remain very useful to companies seeking wider exposure than the show. “We market to 150,000 people to get 10,000 attendees,” says Stuttard. “That’s pretty valuable.”

Here’s an eye-popping metric: Exhibitors who take part in IBS’s numerous print and digital pre-show, at-show and post-show promotions gain 250 percent more leads on average than those who do not. Some of these promotions are low cost, but high value; for about $8,500, a limited number of exhibitors can place a buck slip in the credential mailer that goes out with badges and a current program to about 50,000 early registrants. Digital marketing on site is a good value, as well — it’s very inexpensive to put up and gets a lot of traffic, says Pursell.

ROI measure: Digital marketing on site
Value to IBS exhibitors: High
Cost to IBS: Low

Similarly, hard-copy mailings, e-mail blasts, telemarketing and coded VIP passes in HTML format for exhibitors to distribute offer moderate to high value to ASI exhibitors, at moderate cost to ASI.

ROI measure: Integrated marketing campaign
Value to ASI exhibitors: Moderate to high
Cost to ASI: Moderate

With opportunities like these, Owens Corning continues to put more emphasis on pre-show work that surrounds the show activity and touches customers, “so that they know who we are.” And it would certainly be willing to pay for promotional mailings to the right targets. But on site, “with a lot of new products as focal points, we want to be assured of extra channel exposure,” Pett notes.

He identifies IBS is one of the best at this. At the last show, Owens Corning met with 60 publications, “a big number for us,” says Pett. However, media management and staff time can be costly for show organizers; IBS, for one, has considered charging for these services (although it has not yet done so).

“Very few exhibitors realize the potential benefits of presenting to all market press in one room,” says Reed’s Stuttard. “They’re tremendous.”

The numbers at Interop 2005 in Las Vegas illuminate this: 350 press and analysts in attendance; 153 exhibitor announcements made, and 228 articles written as result. Cost to the show organizer is high, but so is the value.

ROI measure: Press coverage
Value to Interop exhibitor: High
Cost to Interop: High

ADDED VALUE: Presentation Opportunities, Virtual Shows and More
Exhibitors really get excited over the ROI possibilities from presentation opportunities. Owens Corning, for example, takes advantage of every chance to get its people involved in workshops and panels.

ROI measure: Presentations
Value to IBS exhibitor: High
Cost to IBS exhibitor: Low

But it’s tricky to engineer. Show organizers are rightfully choosy about whom they’ll let speak and what they’ll speak about. They may charge exhibitors for exhibitor presentation slots, but never for keynotes.

While IBS encourages exhibitors to submit education proposals, the process is highly vetted through NAHB’s educational committee; not surprisingly, sales pitches are not allowed. “My largest exhibitor could come to me, yet the proposal may not be accepted. It’s not a monetary decision for us,” says Pursell.

Interop also sets up a church-state wall between program content and exhibitors. Those who make it through the call for papers clearly gain high value at no cost. But Interop also offers slots for vendors to provide free education to attendees. And the show will be testing invitation-only vendor education aimed at vertical market segments — like government or education — revealed through audit information.

ROI measure: Free vendor education
Value to Interop exhibitors: High
Cost to Interop exhibitors: Moderate

To reach outside its circle, Car Care World launched a virtual trade show last fall (the annual event is in the spring). According to Weil, new techniques were needed to deliver education and information to the fairly high percentage of people who don’t come to the show. With no materials to ship, the booth fee was very low – hundreds rather than thousands of dollars. Of course, the cost structure was different because the interaction is different. Yet more than 50 companies, including key anchors, exhibited, and webinars that would have taken place during the year were consolidated to take place at the virtual trade show. The five-day online event, which will be shortened to three days this year, brought moderate value relative to cost, Weil says.

ROI measure: Virtual trade show
Value to Car Care World exhibitors: Moderate
Cost  to Car Care World: Moderate

Because every show is unique in its way, organizers can be extremely creative in adding value. The ASI “caravan” between shows provides free transportation of materials for companies that contract at least two consecutive shows or all five. Exhibitors give it very high marks for value, but it’s very low cost for ASI because all materials move together. There’s also no risk to exhibitors of paying overtime for material handling.

ROI Measure: Free shipping
Value for ASI exhibitors: High
Cost to ASI: Low