June 2004
Growth strategies for association shows

Despite limited resources, many associations are discovering unlimited opportunities to grow their shows. They’re employing unconventional techniques to reorganize leadership, meet member needs, attract qualified buyers, offer sponsorship opportunities and develop new partnerships.

By Heather Kirkwood

Something drastic needed to be done. The governing board of the Paint and Decorating Retailers Association (PDRA) recognized its show, the Paint and Decorating Show, had to change or risk shrinking into oblivion. The industry had no shortage of events trying to lure the association’s membership. And the temptation for members to stray from year-after-year attendance at the PDRA show was growing. Increasingly, the show’s buyers were diversifying the products that adorned their retail store shelves. Americans were inclined to shop for their decorating needs at a one-stop location, such as a Home Depot or Lowes, and other stores needed to stay competitive.

But, while the association recognized the need for its members to diversify, it also felt retaining its specialized focus was vital. How could they do both?

The solution came when the opportunity arose for the show to co-locate with the National Hardware Show in Las Vegas.

“We realized that smaller shows were destined to get smaller,” says Nick Cichielo, CEO of PDRA. “So this opportunity seemed perfect. Our show maintains its integrity, but our members benefit from all the other exhibitors and all the other educational offerings at the National Hardware Show.”

The association also benefits from multiple cost savings — from the economies of scale realized by joining forces with a bigger event to the boon in marketing efforts that the hardware show’s owner, Reed Exhibitions, could bring.

Indeed, Cichielo believes the benefits for the PDRA event will only grow. The decision to co-locate was made halfway through the show cycle this year. Next year, the association will benefit from a year-long partnership with the National Hardware Show.

Reed will also benefit from year-long ads and editorial coverage in the association’s two magazines, access to decorative painting experts for the show’s other attendees, and the association’s close relationship with its members.

PDRA’s need to do much more with existing resources is just one of the challenges it shares with associations across the country.

Rethinking association shows
Faced with the same challenges affecting the rest of the business world — a down economy, the terrorism and SARS scares, company consolidations and the emergence of new technologies — many associations have been forced to rethink trade shows.

For some, it’s been the role shows play within ever-changing industries. For others, it’s rethinking the finances behind the scenes. For still others, it’s been asking whether the way the show has been produced for the last 20 years is still really meeting the needs of the members. Today’s reality is associations can no longer assume they are the only, or main, source of information and education for the industries they serve.

Competition from for-profit shows, increased demands on attendee and exhibitor schedules and budgets, and technologies that allow members and nonmembers alike to trade information anytime and anywhere have served as a catalyst for change for the decades-old association trade show.

“Some of the biggest challenges facing association shows are coping with industry consolidation, controlling costs, pressure to maintain current revenue streams and find new ones, and finding ways to better engage membership, as well as leadership,” says Chris Vest, Assistant Director of Media Relations for the American Society of Association Executives.

More and more associations are reorganizing leadership or rewriting job descriptions, recruiting marketing professionals and changing expectations from mere attendee participation to innovation and financial results.

According to the latest ASAE Operating Ratio Report (published in late 2003), associations still rely heavily on shows for non-dues revenue. In fact, the average association derived 21 percent of its income from meeting registration fees, meeting sponsorships and special events, up from 12.2 percent in 2000.  (In the 2000 survey, a separate category “educational program fees,” accounted for 9.6 percent of revenues. However, the report doesn’t specify how many of these programs took place as part of a show.) Another 5.5 percent of income came exclusively from exhibits, down from 7.4 percent in 2000.

“The days of simply announcing the show and everyone would show up are long gone, even for the most conservative associations,” says Sam Lippman, President of Integrated Show Management and Marketing, a company that provides consulting to associations. “Management is changing its expectations of exhibitions. If anything, associations that might have lacked it before are becoming more businesslike in their approach to shows.” 
 
Culture shock
Many association executives used to take a relatively hands-off approach to exhibitions, making expectations clear, but leaving it to the show manager to deliver. Increased financial pressures, however, have more executives taking an active interest in whether their shows are generating all the revenue possible.

At some associations, the executive director’s pay or bonus is now being directly linked to the financial success of the show. The result, some observers say, is more interest in what it takes to produce a successful event. An association executive may be less likely to insist on holding a show in a certain location because it’s the chairman’s hometown, or on cutting the show marketing budget, if his wallet is directly affected.

Another shift in culture, says Charles Allen, Founder of American Exhibitor Services, is a fundamental change in the way associations view their job of hosting trade shows. “When I got into this business 16 years ago, the common feeling was it’s our job to get the people there, but it’s the exhibitor’s job to get them to the booth and sell them on the message,” says Allen. Today, he says, more and more of his association clients are looking to go beyond that basic standard and find ways to help exhibitors more effectively reach their desired customers, as well as extend the return on investment in the show beyond the actual show dates.

In many cases, that has meant increased creativity in the way associations view customer service, exhibit sales and sponsorships.

Michael Payne, Executive Vice President at Smith Bucklin & Associates, which currently manages 35 association shows, attributes the increased attention to service and exhibitor ROI on the need for associations to diversify financially. Although he believes the turnaround has arrived, hard economic times have taught executives not to rely on the same revenues year after year.

“Whether it’s diversifying the primary revenue stream for the association, or looking at the show and diversifying the possible revenue streams it generates, leadership sees the need to not rely on the same old advertising and booth sales,” says Payne.

Putting feet on the floor
Associations, like all other show organizers, are increasingly challenged by how to get the greatest number of qualified buyers to the show.

The need to fill the aisles has associations considering a variety of options. For some, like PDRA, co-location is one solution — whether it’s with a related association or a for-profit event. Even associations that continue to retain the autonomy of their main event are choosing to co-locate smaller regional shows, conferences or seminars, with other events. Or, they’re searching for partners to use their event as a meeting place.

Increasing marketing budgets has also become vital to getting attendees to the show floor.

“It used to be you’d market to the membership, send out a few direct mail pieces, etc.,” says Tom Corcoran, President of Corcoran Expositions, a trade show marketing group with a number of association clients. “Now, I sit down with clients and look at their attendance trends. It’s like using a scalpel to carefully pull things back and reveal where they might grow.”

Not only are show managers discovering they need to send more promotions to get the same results, but promotional materials must be more targeted. Yet associations seldom spend as much on marketing as their for-profit peers. According to “Surviving the Storm: Battling Attendance Decline,” a study by Jacobs Jenner & Kent and the Frost Miller Group, 30 percent of associations experienced attendance decline in 2003, up 6 percent from 2002. Yet associations, on average, only spend $33.53 per attendee to get them to the show, compared with an average of $46.30 per attendee spent by for-profit events.

Finding ways to stretch those marketing dollars now, however, has the attention of association executives. They’re noticing another trend the study found — shows that are increasing marketing are also increasing attendance.

In search of the sponsorship dollar
Increasing sponsorship revenue is one way associations are finding they can increase budgets and revenue without recruiting new attendees or exhibitors. Garth Jordan, Director of Sales for the Association of Operating Room Nurses (AORN), increased sponsorship revenue simply by changing the way the association viewed its sponsorship opportunities. The result: The association has doubled sponsorship revenue in the last few years — from roughly $150,000 at its main event, the AORN Congress, to $300,000 this year. And the number is growing.

“Associations often look at sponsorships as a way to pay for a dinner or a session, or to bring in some piece of equipment they want to show to members,” says Jordan. He believes, however, that if you can’t pay for a function on its own, it isn’t worth having. To him, sponsorships aren’t about trades; they’re about making money.

In addition, many associations undervalue the sponsorships they sell, according to Jordan. For example, if sponsorship of a dinner is sold, the association might only charge the exhibitor little more than the cost of the dinner. That, according to Jordan, doesn’t reflect the actual value of the sponsorship. “We’re giving them eyeballs for their message, and that’s worth something,” says Jordan.

Sponsorships can gain even more value if they “grow tentacles.” By this, Jordan says, he means that sponsorships have more value if they extend well beyond the show. He’s working on ways to tie sponsorships at the show to other activities the association does year-round, such as a newsletter. He not only sells sponsorship of the newsletter at the event, in a kiosk loaded with the sponsor’s signage, he allows them to be a newsletter sponsor year-round, thereby extending the kiosk to multiple association events. He also offers use of the newsletter mailing list for a specified number of times throughout the year.

“The bottom line is we have to do our jobs as an association. We have to attract new members so we always have something new to offer,” he says. 
 
Spicing up educational sessions
While exhibitors may come to an association show to sell, education is often foremost on the minds of association members. For decades, superb educational offerings have been an area where association shows often held the upper hand.

“We’ve noticed people just aren’t as willing to fly halfway around the country to be talked at for five days,” says John Nofsinger, Executive Director of Materials Handling Industry of America. 

His show was known for its educational offerings since its beginnings in the 1950s, but waning interest in staying for the entire event, coupled with lagging participation in educational seminars, concerned leadership enough that they set about turning the idea of educational sessions, along with the rest of the show, upside down. During the past few years, the association retained the larger sessions with well-known speakers hashing out key industry issues. But it scrapped the traditional conference how-to workshops.

Instead, it created theater areas on the show floor. Instead of leaving the show floor for a two-hour workshop, presenters were asked to boil down their presentations to 45 minutes. The move helped attendees use their time more effectively and added energy to the show floor. Exhibitors were thrilled that there were fewer distractions pulling attendees from the show floor.

Even the basic planning of educational sessions is changing at many associations. No longer are there strict lines between exhibit sales staff and the conference planner. Rather, at many associations, they’re starting to work together. For some shows, it’s simply a matter of identifying an attendee group the exhibitors want to see that could be lured by offering sessions more appealing to them. For others, it’s loosening rules against exhibitors presenting sessions. (An exception is medical associations.) 

Implementing new strategies
Perhaps the biggest challenge for association show managers is selling the innovations they want to make to association leadership, elected office holders, or even volunteers. But as association leadership increasingly recognizes the need for change, they’re becoming allies of the show manager to sell change to the membership.

Nofsinger says advanced planning was key to his success. The association asked several key members to stay on beyond their usual terms in order to ensure consistency in leadership through the changes. “We didn’t need to be getting into historical debates about what we did 10 years ago, and we didn’t need to get two years into this process only to have all of our key people change,” he says.

Susan Giver, Director of Marketing and Expositions for the Society of Naval Architects and Marine Engineers, says doing her homework — both on the proposal one wants to make and on the people who will ultimately decide — was critical to selling her board on the need to outsource booth sales for the SNAME Show.

“I’m a marketing person. I get enthusiastic about ideas, but the mistake I made at first was not fully appreciating that I was selling the idea to 20 engineers,” Giver says. “They’re not interested in enthusiasm. They just want numbers.”

Giver prepared by making an ally of her executive director, someone the engineers trusted. She then gathered the best numbers she could find to back up her plan. She built her case by consulting IAEM and other show organizers about how they outsourced booth sales.

The by-the-numbers approach worked, and today Giver’s show is sold out months ahead of schedule. Even better, because she partnered with a publisher, she says she’s received $200,000 worth of free advertising and marketing.

“With limited resources, you just can’t beat that,” she says.

Heather Kirkwood is Senior Editor of EXPO. She can be reached at (913) 344-1376, or e-mail: hkirkwood@ascendmedia.com.