Annual trade show attendance trend survey reveals database marketing is out; relationship marketing is in

By Heather Kirkwood

Successful show organizers are fighting attendance woes by forming stronger relationships with their attendees, according to the second annual survey of attendance trends among major show organizers.

The survey, Surviving the Storm: Battling the Decline in Trade Show Attendance, was conducted by the Frost Miller Group and Jacobs Jenner & Kent and presented at the IAEM Annual Meeting in Las Vegas. It shows that relationship marketing is on the rise among successful shows trying to differentiate themselves from competitors.

Relationship marketing looks at the long-term by establishing customer loyalty. It requires show managers to think strategically about how to achieve attendance goals over an extended period of time by finding ways to build a bond with attendees.
Show managers who understand the experience attendees have at their show and are willing to provide solutions to attendees’ problems are more effective at marketing their shows and cultivating attendees. This is often true even in soft markets.

It’s a lesson Cindy Hare, Director of Operations and Senior Show Manager of the Action Sports Retailers (ASR) Trade Expos, understands well. After learning that attendees were experiencing difficulties with finding parking near the show, standing in long lines, or finding a good meal near the convention center, show management created a VIP program that not only solved these problems, but helped build a bond with attendees by making them feel valued.

“The study points out that there are key differences separating organizers whose events are succeeding from those whose events are failing,” says Wayne Jacobs, President, Jacobs Jenner & Kent, “Organizers of growing events are focusing on relationship marketing and market research. Organizers of declining events are focused on e-marketing, Web advertising and database marketing.”

In 2003, 89 percent of show organizers with increasing attendance used some sort of relationship marketing strategy, while only 54 percent of declining shows used such a strategy. Some of the more popular programs for both small and large shows included educational certification, providing meeting space for attendee teams, coupon specials, special orientation programs, providing VIP lodging, or co-locating shows with crossover audiences.

Who’s up and who’s down
Overall, the exhibition industry has become more stable since the 2002 attendance study. Thirty-one percent of shows are holding attendance steady, up from 25 percent in 2002. Fewer shows (43 percent) are growing attendance, down from 48 percent in 2002, yet fewer are experiencing declining attendance, 26 percent versus 27 percent in 2002.

Thirty percent of association shows are demonstrating attendance declines, up from 24 percent in 2002, compared with only 18 percent of independent shows, down from 29 percent in 2002.

Size is also a factor affecting whether attendance is up or down. Smaller shows, (those with fewer than 100,000 square feet) are struggling to compete with bigger shows (larger than 100,000 square feet) for attendance. Forty-nine percent of the smaller shows experienced attendance declines, compared with only 23 percent of larger shows.

Bob James, President of the Frost Miller Group, advises show organizers that in the current environment, there is only one chance to sell an attendee on an event. “Research we’ve done for clients indicates the average attendee is only attending one show,” says James. This gives larger shows an edge. “If you could only attend one show, wouldn’t you want to go to the show where there are more exhibits and a bigger variety?” he asks. Thus, to compete, smaller shows must learn to think strategically to offer the most value, says James.

Shifting challenges
Top on the list of challenges is increasing marketing response rates, up from number two last year. Getting attendees to the front door has never been easy, but show managers from all over the industry report working even harder to gain attendees.

Attracting international attendees, however, rocketed to the second biggest challenge reported by show managers, up from number seven in 2002. This isn’t surprising, given the complications of obtaining visas experienced by many international attendees in the last year. Now, visitors from abroad must plan even further in advance to attend an American event, which may make it less likely they’ll make the effort.
Reaching VIPs and power buyers is next, followed by increasing first-time attendees, which fell from the biggest challenge in 2002, to number four in 2003.

“It’s easier to find first-time attendees,” says Jacobs, “Thanks to downsizing, people have shifted in their job responsibilities or moved jobs completely, thus it’s likely there are more potential attendees who haven’t been to a particular show.”

VIP attendees are more important to smaller events that can’t compete on raw attendance numbers alone. Thus, smaller events must offer a higher level of attendee to attract exhibitors, says Jacobs.

Although it’s not a small show, attracting those VIPs is why the ASR Trade Expos implemented its Stars VIP program. “We looked for things that created obstacles to attendees coming to the show,” explains Hare, “Then we looked for ways we could turn those problems into assets by using them to build a relationship with our attendees.” Among the perks offered to the show’s VIP guests was free parking near the convention center. Parking had become a frequent complaint at the San Diego ASR Expo, according to Hare.

Other perks include special show hours for VIP attendees to help them speak to exhibitors without the crowds, and a special express registration line. Another frequent complaint from attendees was the inability to get a good meal near the event, so show management now works with its host CVBs to offer coupons for nearby restaurants. They also offer VIPs coupons for the concessions within the convention center and free breakfast and lunch in the VIP lounge.

Exhibitors submit the names of their 10 best clients for the VIP program, and show management combs its past registration lists to find frequent repeat attendees and reward them for their loyalty by including them in the program. VIPs are eligible for perks at any ASR event. Exhibitors are given the opportunity to sponsor the program. Not only do attendees love the perks, they promote repeat attendance, says Hare.

Spend it to make it
Another factor shows with growing attendance share is increasing marketing budgets, even in tough times. Fifty percent of growing shows increased marketing budgets from 2002 to 2003, while only 24 percent of declining shows increased their budgets. Meanwhile, only 3 percent of growing shows cut their marketing budgets, while 24 percent of declining shows did so.

According to the mean budgets reported, growing shows may have marketing budgets that are up to twice as high as declining shows. Among growing smaller shows (less than 100,000 square feet), the mean reported marketing budget was $289,000, while declining shows in the same category had a mean marketing budget of $113,000. The gap wasn’t as wide among larger shows, but the successful shows still outspent the declining ones, reporting mean budgets of $940,000 compared with $800,000 for declining shows.

“There is definitely a relationship between what you spend on marketing, and what you get out of it,” says James, “Some declining shows will have to increase their marketing budgets as much as 150 percent just to pull out of the slump.”

Associations, on average, spent $33.53 to acquire each attendee, while independent shows spent, on average, $46.30 to acquire each attendee. James notes, however, that associations have additional reasons to contact potential attendees throughout the year, and those contacts are not included in these numbers.

Filling the aisles
E-mail has rocketed to the top of the list of favored marketing tools. More than nine out of 10 organizers (92 percent) use e-mail in their marketing mix and 84 percent report increasing their usage of the medium between 2002 and 2003. Moreover, organizers tend to rely heavily on e-mail. Sixty-four percent send five or more e-mails to potential attendees when marketing their shows.

Jacobs views these results with a note of caution. “I wouldn’t want anyone to look at these numbers and then rely on e-mail marketing,” he says, “The effectiveness depends on how e-mail is used.” He believes it works best as a tool to build relationships with attendees already committed to attending the show, rather than for blasting potential attendees.

Another factor in the rise of the use of e-mail is that it’s inexpensive, notes James. There is relatively little risk involved.

Old standards also remain popular, such as direct mail, used by 97 percent of show organizers, and print advertising, used by 92 percent of show organizers. More than half of show organizers use these tools five times or more while marketing their shows — and with good reason. Research shows repetition increases effectiveness.

Next steps
Both Jacobs and James agree their data shows a path forward for managers of growing as well as declining shows. Managers of large shows, for example, should concentrate on building their relationship marketing efforts with repeat as well as first-time attendees. Smaller shows, meanwhile, are better served by looking for ways to use relationship-marketing tactics to uncover and offer unique opportunities. These might include looking for co-location opportunities, or offering better VIP programs.
“Even if you have to call the VIP attendees, invite them, and pay for their lodging to get them to your show, it will be worth it,” says James.

Shows with growing attendance should look for ways to capitalize on the momentum by improving the return on investment the show offers, as well as improving show management’s methods of measuring that return on investment, says James. Declining shows, meanwhile, should be looking for natural audiences to build their attendee base. Co-location is one method for doing this. Declining shows must also re-evaluate their marketing budgets and develop a strategic spending plan. “You’ll get what you pay for,” says James.

Heather Kirkwood is Senior Editor of EXPO. She can be reached at
hkirkwood@ascendmedia.com.