The Hard Sell

In 1999, the National Hardware Show, run by Norwalk, CT-based Reed Exhibitions in conjunction with the American Hardware Manufacturers Association (AHMA), filled 1.2 million square feet of Chicago's McCormick Place. Four years later, however, the show could muster only 450,000 square feet of exhibits. Part of the reason, says Rob Cappiello, Reed's industry vice president for the show, was that "major exhibitors like Black and Decker and Ski/Bosch had been clamoring for changes at the show in light of the consolidation of buyers in the hardware industry." But Reed and AHMA were bitterly at odds over the nature and degree of the changes that should be made; the dispute was loud and lengthy.

The result, as the numbers prove, was stark. And the rift between Reed and the AHMA over the show's direction ran so deep that Reed ended its association with AHMA and moved the show to Las Vegas for May 2004. For its part, AHMA will run a competing show in Chicago one month earlier.

There's no doubt that in any industry, the biggest companies -- those that can be anchor tenants for a show -- have many options for how to use their marketing money, including for their own customer events. For show manager in the 21st century, that's a perilous fact. So despite the unusual way Cappiello arrived at his situation, his dilemma is no different thant the one facing many other show managers: "The big guys felt that the show was not doing what it was supposed to do to give them value," he says. "We have to try lure them back by saying, 'Now, you can get more for your money by doing things with us.' "

A familiar refrain, indeed. Here, then, is what Cappiello and other show managers are doing to create value that exhibitors can't get anywhere but at an industry show.



The Wallflowers

These days, many shows are finding that some big companies simply do not want their primary presence to be on the show floor. "More firms, as they mature, believe that the traditional show model may not make sense for them," says Brian Casey, president of Chicago-based Next Generation Event Group. In his work, he sees this firsthand; the 24-year veteran produces not only association shows, but also an increasing number of proprietary events for corporations.

That National Hardware Show has acknowledged this sentiment. "We used to think of our clients as 'exhibitors' but now we think of them as 'participants,' " Cappiello says. "If a large exhibitor tells us that they don't want to have a big floor display anymore, but rather have its own function off the show floor, we say, 'You should do this with us -- thre are built-in advantages to it.' "

Benefits to that firm include bringing its event under the show's contracts for space rental and food and beverage. This achieves several things: It keeps the event nearer to the exhibit hall, saves the exhibitor money, and allows the show manager to coordinate the event so that it doesn't conflict with another one that would attract the same audience. Not least, says Cappiello, is that "we can brand their event in our program as being part of the show."

In the current climate, this last benefit is important not only to the participating company, but also to show management. "It's still important to have certain companies associated with your event, even in a different manner, rather than lose them altogether," says Casey. "There are always going to be a small to mid-sized companies that need the traditional show floor environment because of the efficiency it brings them. So your ability to promote the presence of the market leaders, in whichever form they choose to participate, benefits the majority of exhibitors by bringing credibility and drawing attendance, and keeps them satisfied."

In fact, that might be the only benefit for show management when assisting an off-floor event. Often, the event won't generate much, if any, additional revenue for the show. "Our financial model doesn't mean we make money on every last thing," says Cappiello. "We may just help with logistics of an off-floor event and not ask for a fee, because the company's participation helps everyone." Still, Cappiello pushes, and usually gets, such companies to have some form of paid presence on the show floor. "It's probably not going to be large," he notes. "It may simply be informational, or perhaps it's something fun that creates a buzz instead of displaying the products that they want to showcase at the off-floor event."

With this strategy, however, comes a need by show managers to maintain a balance so that off-floor events don't take on a life of their own and, over time, make the show floor seem like an afterthought. David Weil, senior director of convention and trade show services for Smith, Bucklin and Associates, a Chicago-based producer of more than 150 association shows, is leery of ever seeing more than a few off-floor events at a show, and especially ones with show management's imprimatur. "To maximize the presence of big companies, we prefer to focus more on customizing sponsorships in a way that delivers to them the audience segments they are looking for," he says.



Class Action

Over the past decade, Portland, ME-based Diversified Business Communications (DBC) has seen some of its largest exhibitors from its food industry shows, including distribution giant Sysco, create their own regional events for customers and buyers. To remain relevant to the marketing plans of these large companies, DBC responded by boosting the educational component of its shows and touting their ability to bring in attendees from across North America, versus the mostly regional draw of companies' own events.

Similarly, the National Hardware Show has boosted educational sessions from fewer than 10 last year to nearly 60 for the 2004 event. "We've asked manufacturers and retailers alike what's important to them, and they've said education," says Beth Blake, a spokesperson for the show. "They want to hear trends and new concepts and ideas that they can use to change how they sell right now. So we promoted the fact that the show would offer a first look at an exclusive study from a home-improvement research institute on demographic trends in hardware purchasing behavior. It talks about how the 'outdoor living' concept has become popular, how the Asian and Latin communities want to be sold to, how first-time home-buyers and retirees approach home improvement, and more. This type of information coming out of an industrywide show just can't be matched by proprietary corporate shows, and it attracts attendees who need justification to come to events these days."

In keeping with the mission to identify and promote trends, the hardware show also created a speciality pavilion called New Product World, which not only showcases products as they would be sold in the retail environment, but also hosts a preshow event that's open only to trade and consumer media. Similarly, Diversified Business Communications has had much success with promoting the ethnic and organic trends that are shaping the food industry, drawing so many interested attendees and exhibitors that DBC has spun off events such as Expo Comida Latina, which premiered in New York in October.

In the end, managers of well-run exhibitions should have enough ammunition to blunt the urge of big companies to leave the show entirely in lieu of other marketing media, including their own proprietary events. "Companies are rarely happy with the costs for exhibit space and labor at industry shows, but it's still not nearly as high as setting up their own events and marketing to the right people instead of their same old contacts," says David Weil from Smith, Bucklin. "We just need to persuade them to let the associations and show managers do the legwork to regularly bring in the right people for them."

And just as there's no guarantee that an exhibitor will stay with your show forever, there's also no guarantee that those you've lost for the moment will stay away forever -- especially if they witness that you're doing things well. Take the case of DBC's Fish Expo Workboat Northwest. A few years ago, several processing equipment companies chose to pull their exhibiting money in order to hold a collective private event that piggybacked the annual Seattle show. DBC made changes to its event based on those companies' complaints; those firms are now in discussion with DBC about possibly coming back into the show.