By Paul Woodward, Chairman of Paul Woodward Advisory
Every exhibition organiser that has them loves them; the giant shows, the bedrock of the business, money machines with margins better than selling crack cocaine. But what’s going on? I was debating with a colleague at the end of last week which would be the next shoe to fall. Cebit is gone. Baselworld is in intensive care. Thirteen major brands including Fiat Chrysler and Volkswagen pulled out of this year’s Mondial de l’Automobile in Paris. And, just as we were speaking, Emerald announced that the grand-daddy of US cycling shows, Interbike is no more.
It’s clear that many of the reasons behind these challenges and failures are different for each show. But, is there a common thread? Are the days of the giant trade fair numbered? The maverick Nick Hayek, CEO of Swatch and the biggest player in the Swiss watch industry, was pretty clear and pretty scathing “When you look at these old traditional watch fairs, it doesn't make any sense anymore,” Hayek is reported to have told CNBC. “We are present in the whole world with our brands, close to the consumer and the retailer…It is necessary that [trade fairs] reinvent themselves, responding appropriately to the current situation and demonstrating more dynamism and creativity. At the moment, the trade fairs are failing to do so”.
And you can’t just blame complacency (although it’s an issue I’ve raised before). We have seen one or two of the giant fairs making serious and valiant efforts to reinvent themselves as Hayek suggests they should…and still fail to retain the big corporate exhibitors. Once they pull out, the wheels very quickly come off the bus.
Lots of money is still being spent by the big corporations on their own events… good news for the likes of GES, GL Events and Freeman…and even more is being redirected towards sponsorship at everything from arts and cultural events to new generation business events such as the Web Summit.
Does it really make sense these days to expect business buyers to trudge for 2-3 days around vast, identical, and dreary exhibition halls in the hope of finding a new product or service that will transform their businesses? Or that, at the larger events, the big corporations should have to spend $10m or more to establish a presence worthy of their industry clout for a very vaguely-defined return on their investment?
Asia so far seems largely immune from this contagion and the types of shows which currently thrive there are different. But some of the 30+ year old events in Hong Kong, Singapore and Japan can no longer rely on being surrounded by economies enjoying double-digit growth. So, it may only be a matter of time.
I believe that there is a great future for business events. But, I’m suspecting that the ones which succeed will either be smaller and much more focused, delivering exactly and only the audience that the marketers need or very social gatherings, multi-dimensional networking events which, at the moment, Web Summit and SXSW typify. They don’t need the vast grids of look-alike booths to work and often take place over multiple smaller and more interesting venues.
The exhibitions world has not previously seen an existential threat of the type which effectively destroyed the B2B magazine world. And, there will be many who stand up at industry conferences and deny it now. Everything will be fine they will say “once the trade war issue is resolved”, “once we are out of these tough times” (despite the fact that these are not in fact tough times; economies are largely excellent right now), “once our new logo design has been signed off by the Board”. That’s what the business magazine publishers were saying 15 years ago. Those businesses no longer exist.