October 2005
Virtual show, real money
Reed makes 50 percent profit margin on debut edition of Web-based Wireless Expo
By Cathy Chatfield-Taylor

Call it what you will — virtual trade show, online event or interactive environment. Reed may call it a cash cow. Wireless Expo, held Nov. 16–17, 2004, online at www.wirelessexpo.net, returned 50 cents on the dollar, generating 420 qualified leads per booth and delivering more than four hours of quality education per attendee.

“Our goal for the first year was $100,000 in sponsorship revenue, with total costs of $55,000 to $60,000 for a 40 percent margin,” says Michael Kushner, Vice President, Integrated Media Solutions, Reed Business Information (www.reedbusiness interactive.com), a division of Reed Elsevier Inc. based in Rockaway, NJ. “We did $130,000 in revenue, and costs were in line with projections for a margin of about 50 percent.”

Reed is focusing on online events as a revenue generator in markets in which readers of its business publications increasingly turn to the Web for information. Kushner’s group targets electronics, science and medical, and manufacturing sectors for sales of Webcasting as a marketing solution. Sponsors see their brands promoted in crossover print publications, e-newsletters, Web sites and e-mail blasts.

The virtual trade show takes the concept a step further by creating an interactive environment in which visitors can attend multiple Webcasts organized into tracks, ask presenters questions during live Q&A sessions, visit virtual booths for product information, chat with sales representatives, and download white papers and sales literature. After the live event, attendees can view archived Webcasts on demand and visit exhibit booths for 90 days.

Reed’s model is sponsorship driven. To maximize both profits and customer value, events need the right balance of content and sponsorship opportunities. An extension of Wireless Week magazine, Wireless Expo 2004 offered 27 sessions in two conference halls, each with multiple tracks. Six sponsors paid $12,500 to $35,000 for conference hall, conference track and exhibit hall exclusives.

In the exhibit hall, 20 exhibitors paid $2,500 to $5,000 for booth packages featuring customizable color schemes, product listings, document downloads and instant messaging on the low end; and prize giveaways, message boards, and streaming audio or video on the high end.

About half of the 3,200 registered attendees logged in for the live event, which Kushner says is typical for Webcasts. But each attendee logged in an average of three times and stayed 86 minutes per visit. In exchange for free entry to Wireless Expo, attendees gave Reed permission to track their activities and report what they do. It’s this data that makes the online event a gold mine.

“Whatever the attendee is doing, we’re measuring that,” says Gonen Ziv, Senior Vice President of Sales & Operations for Unisfair (www.unisfair.com), an Israeli company whose technology has powered virtual trade shows for Reed, Advanstar and others since 2000. “If they ask a question or download a white paper, we give different weights to the actions people take.”

These weighted actions are used to rank-order leads by intent to buy. Sponsors receive detailed reports with the hottest leads first. In addition to the usual demographics and qualifying information, the reports list Webcasts attended, questions asked, polls answered, chats initiated, files downloaded and products viewed. Hyperlinks track each prospect’s pathway through the entire event.

Ziv says this analysis and reporting system provides better value for sponsorships. Because attendees are in their offices participating via the Web, hot leads can be reached by phone or e-mail within minutes of interacting with an exhibit to close a sale.

Even a successful model can be refined. Changes for Wireless Expo 2005 include splitting the event into one-day spring and fall conferences (second-day attendance had dropped off), reducing the number of sessions to 10 in two tracks (a cost-control measure), keeping archives open for 365 days (longer brand exposure), and tweaking sponsorship and booth packages (raising prices but offering more options).

“Going with a 365-day model gives us the entire year to sell exhibitors into the program,” Kushner says. “Our goal this year is $150,000 to $160,000, keeping costs where they are.” Do the math.