April 2003
How the world’s #1 software company invests in shows
An inside look at how IT powerhouse Microsoft plans, evaluates, executes and acts on its show strategy
By Elizabeth Ingram
Imagine participating in or producing 5,000 events world-wide each year — that’s nearly 14 events a day. Sounds challenging, but it’s a fact of life at Microsoft Corp., where the yearly event mix is 60 percent branded corporate events, 30 percent trade show industry events and 10 percent internally/employee focused events. That works out to 1,500 trade shows that Microsoft exhibits in — worldwide — and these run the gamut from a few large U.S. and international shows like COMDEX and CeBIT Germany to small tabletop displays in 8-by-10 booths at user group events. In 2002, Microsoft spent about 1.4 percent of its $28.37 billion in global revenue on events. How does your show get a piece of that pie? And perhaps a more important question: How does the trade show industry retain or increase our share of the corporate marketing budget?
EXPO talked to Microsoft’s Jon Bromberg, Director of Event Creative and Productions, and Jeff Singsaas, Director of Event Business and Operations, to find out. As you’d expect, Microsoft has specific goals in mind when participating in trade shows. “We want to build awareness and visibility of our products, allow one-to-one and one-to-many interaction, and promote the overall Microsoft brand,” Bromberg says. Singsaas sees events as part of a three-legged marketing stool that includes advertising and structured sales programs. “The one-to-many communication opportunity is really the sweet spot for events. That’s why Microsoft has invested over the years in developing a strategy that’s effective, measurable and agile,” he says.
Over the past few years, that strategy has meant an increase in the number of trade shows in which Microsoft exhibits. That’s the good news. The bad news is that spending hasn’t increased, and Bromberg predicts that event spending will generally remain flat over the next few years, barring any major changes in the economy or the global political situation.
In addition, the technology industry is moving toward more branded corporate events. And Microsoft is certainly one of the leading corporate event producers with 3,000 events in 2002. But that wasn’t always the case. Five years ago, Microsoft’s event mix was probably more like 60 percent trade shows and 30 percent corporate events, Bromberg estimates.
Interestingly, he also believes re-engineered trade shows will make up any lost ground in the long term. That’s a pretty bold statement. What can we do to ensure this happens? An inside look at how this IT powerhouse plans, evaluates, executes and acts on its show strategy reveals some fascinating answers.
Centralizing event operations
Each year, Microsoft’s events division is responsible for more than 175 events of various scales, while the rest are handled by regional field offices. Bromberg and Singsaas lead a group of 40 full-time employees dedicated to producing flawless events. “We’re focused on improving the experience for our end users, customers and partners,” Bromberg says. The events organization, now part of the Corporate Marketing Group (CMG), was centralized in 2000 to bring together events operations formerly dispersed throughout the corporation. The intent was to drive significant improvements in process, cost efficiency and leverage of resources. In addition to events, the CMG also includes other primary marketing disciplines — public relations, advertising, branding, packaging and research.
In a nutshell, the events group is divided into six businesses: Event Creative, Technical Production/Staging, Presentations/Graphics, Event Program Management, Business Operations and Partner Pavilion Programs. Event Program Management is the largest group and is the engagement point through which all other teams work. The group is responsible for program management, budgeting, logistics planning, registration, food and beverage, venue operations and room block contacting — essentially the operational event backbone.
“The real challenge post-centralization was to define internal working relationships — roles and responsibilities,” says Singsaas. “We designed a partnership triad of a business owner, content owner and process owner. I saw the most leverage in having the events team responsible for the overall process, budget and logistics issues. That’s a huge job considering the magnitude of the shows we do.” The “business owner,” one of seven Microsoft divisions, sets the objectives, messaging goals and actual event budget, as well as overseeing demand generation, marketing elements, public relations and other areas. “We gave up actual ownership of budget and definition of marketing objectives, but we provide the framework and horsepower for making it all happen,” he says. However, the events group, “process owner,” recommends shows and often provides feedback to the business owner or “content owner,” the product manager, if, for example, the budget won’t cover the goals for the event or a requested location won’t deliver the required press coverage. In the end, all three influence the choice of shows.
To guide their moves, the events division has developed an event life cycle chart that defines the various stages of the event process. This circular tool begins with “plan,” then moves to “execute,” “evaluate” and “act.” To focus on how well they perform each of the four steps, the group assigns each the stoplight color — red, yellow or green. In viewing event work in this fashion, Singsaas and Bromberg were able to quickly focus on where improvement was needed. Bromberg admits Microsoft has, in the past, not done a very good job on the evaluate and act steps, which has placed them in the red on evaluate and yellow on the act quadrant. But today, with a renewed focus on measuring results, he says all the areas are either green or yellow.
Corporate vs. trade show strategy
“A trade show is a can’t-miss event for Microsoft when it speaks to the right people (audience), provides good value (cost vs. return on investment), meets our overall marketing objectives and has the potential benefit of unique opportunities to speak to the industry,” Bromberg says.
At the same time, Microsoft believes and invests heavily in its branded events. Each year, there are a number of branded events tied to a specific product launch or announcement, which typically is nonrecurring and tied to an educational program. For example, the company held a Tech Summit Sept. 5-6, 2002, in Hollywood, CA, to coincide with the launch of the Windows Media 9 Series. The intended audience for the product launch included press, Microsoft partners and Tier 1 customers, while the audience for the concurrent educational summit included content developers, IT professional and application developers in the media/entertainment and enterprise markets.
Microsoft’s core branded events are its yearly conferences. “Unlike industry events, we’re able to design the attendee experience to give customers what they’ve asked for,” Singsaas says. Bromberg says exhibitors are surrounded by their competitors at an industry event and must compete with the buzz and noise generated by their marketing endeavors. However, at a branded event Microsoft targets the mix and message, including how the company portrays itself and its partners to its selected audiences. “But both types of events are extremely important in the mix,” Bromberg says.
One example of a long-running and successful branded show for Microsoft is Tech-Ed. This yearly event brings together about 10,000 technology professionals for keynotes, general sessions and breakouts on data management, enterprise implementations of messaging and productivity software networking, security and more. In addition, the show features more than 200 exhibitors, both Microsoft partners like Hewlett-Packard and Dell and third-party providers, such as NEC and Attachmate Corp. The next show will be held June 1-6, 2003, in Dallas.
On the trade show side, Bromberg cites the International Consumer Electronics Show (CES) as a successful event because it “gives us the opportunity to establish our vision of realizing our customer’s potential with the breadth and depth of software and products we create and the partners we work with.” He says the show floor features a good mix of Microsoft’s partners and good-quality attendees in the company’s target markets. In addition, CES has a “focused approach to addressing the consumer market and maintains a good balance of attendance and exhibitor satisfaction, creating some level of return on objectives (ROO). They are not trying to be everything to everybody,” Singsaas says.
Making the cut
Not every show is as successful for Microsoft as CES, and the company must continually analyze its participation. That’s why Bromberg and Singsaas have created an assessment matrix that helps them determine return on investment (ROI) and make decisions about future participation. Bromberg admits this year is the first time Microsoft has taken a company-wide view of its event participation, but they plan to make it an annual focus going forward.
Microsoft grades its existing event portfolio, as well as new opportunities, on a scale of 1 to 5, with 1 being “Weak scores in all selection criteria. Recommend deleting from the program (or removing from consideration).” And 5 is “Strong score for all selection criteria; excellent cost to value ratio; may represent a unique event opportunity. Recommend keeping on the existing event program (or adding the new event to the existing event program).”
As part of this matrix, events are ranked on key criteria specific to the core business or products associated with the events. These include: content alignment, key industry event, marketing/networking opportunities, press exposure and speaking opportunities, among others. Once all events are scored, those falling below a certain threshold are recommended for removal from the events schedule. “It’s not necessarily a case of us cutting events because we’re looking for cost savings,” Singsaas says. Instead, they want concrete proof that a show will support their marketing objectives.
Support often comes in the form of keynote addresses, which is a key strategy for the events division. “Keynotes at shows like CES and COMDEX are great opportunities to paint a vision of how technology impacts all areas of our lives and how Microsoft with its partners allows people to realize their goals and potential,” Bromberg says.
Microsoft typically works out the opportunity to present a keynote with the show manager at the same time as it’s making decisions about its degree of participation in the show. “We sometimes ask for a keynote if we have a specific product launch, and we take others that are offered if the keynote would be valuable to our objectives at that specific event,” Bromberg says.
Costs compared to value
Cost is one subject that’s always on the minds of exhibitors, and Microsoft is no exception. The corporation’s events division works to keep its spending on industry events in line. The company’s overall event budget is split between six areas: 25 percent on floor space; 10 percent on additional marketing opportunities with show management, such as wall banners, kiosks and tents; 10 percent on shipping; 35 percent on show services (including labor); 15 percent on audiovisual, staging and lighting; and 5 percent on hardware and technical support.
“We’re really trying to leverage our spending, and if shows don’t score well, it will figure into our forward planning,” Singsaas says.
Shows that are guaranteed to be part of Microsoft’s future are those that focus more on meeting the needs and objectives of exhibitors than on generating revenue, Bromberg says. For example, exhibitors need more of their show investment to go toward meeting their marketing objectives, and they look for great follow-up metrics, continuous communication and the right people visiting the booth, he says. “We’d like to see the needle move more toward ROO and the quality of the interaction between customers and exhibitors with controlled costs, innovation and continuous improvement,” Singsaas says.
In the end, it’s all about value. “Value and costs are two sides of a seesaw,” Bromberg says. “People tend to look at the cost of big-ticket items when they’re not getting the value they want.”
Show strategy of the future
While Microsoft is constantly evaluating new trade shows with an eye toward potentially adding them to the mix, in 2002, the company actually cut the number of its scheduled trade shows due to the economic climate. “We’re supportive of industry events and feel there’s a place for them in our marketing mix, however, we are looking for the show industry to continue to evolve to provide better overall ROI,” Bromberg says. He expects branded events to continue to be important to Microsoft, with the number held remaining flat.
Singsaas says that, over the next couple of years, Microsoft will continue to participate in some larger, more highly leveraged industry events. But he sees the company’s event strategy moving toward smaller, regional and more targeted events. “We believe smaller, more targeted industry events can provide a great opportunity for Microsoft to acquire new customers,” Singsaas says.
Elizabeth Ingram is the Editor-in-Chief of EXPO magazine. She can be reached at eingram@ascendmedia.com.
“We try to keep Microsoft (and other exhibitors) happy by listening to their needs, creating a level of trust and ensuring that they understand we want to be a partner with them, not just someone who knocks on their door once a year to sell them a booth,” says Karen Chupka, Vice President of Events and Conferences for the Consumer Electronics Association. Here are five ways CES accomplishes those goals and makes the show a successful event for Microsoft:
Reach out to exhibitors. About three years ago, CES began to sit down with Microsoft and investigate what the company was trying to accomplish. “Understanding who they are trying to reach has enabled us to help them identify ways to get the return they’re looking for,” she says. Some of these ways include a keynote or an overview session headed by a Microsoft executive.
Remain accessible. Chupka says Microsoft is involved in keynotes, conference sessions, public relations and the show’s government VIP program, so they work with many different members of the CES staff. “We make sure that the key people from Microsoft always know how to get ahold of us and that we’re always ready to help them,” she says.
Consider joint programs. Two years ago, the government affairs department at CES and Microsoft worked together to bring key government officials to the show. Both groups issued invitations to the show, and they held a private reception for the government officials with Bill Gates after his keynote, Chupka says. “This was a prime example of how we partnered and benefited from each other,” she says.
Offer differentiation. “Microsoft often challenges us to come up with new ideas to showcase their brand at CES,” Chupka says. One differentiation idea included sponsorship of the CES store, which featured placement of Microsoft’s products in the store.
Know your boundaries. It’s great to customize programs for exhibitors, but keep in mind that the few major exhibitors at the show aren’t your only customers, Chupka says. Be creative but fair.
What show managers could do for exhibitors
If you’ve ever wondered about what’s really important to exhibitors, the Directors of Events for Microsoft Corp. can tell you. Following are four tips they recommend for managers of every event, regardless of size:
Keep the show pure. “If you’ve got a hard-core high-tech show, the expectation is that you’re going to draw a high-quality audience.” So don’t dilute it with exhibitors who don’t fit in.
Provide audience demographics. “We’re looking to interact with a group of attendees, so it would be great to know if they’re really there.” Instead of making exhibitors guess or do their own research, give them the data they need to measure the show.
Engage key exhibitors. “There’s a lot of improvement that can be done on a show-to-show basis, so sit down with exhibitors and ask how you can make it a better show for them.” Exhibitors who attend multiple shows have seen what works well and what doesn’t.
Know what exhibitors need. “There’s a notion about conferences being more in-depth, but trade shows can do the same thing.” The shows that provide the best results for Microsoft do a good job of mixing the exhibition with in-depth education.
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