Last month we saw the arrival and departure of the annual International Direct Marketing Fair (IDMF) in London.
For three days, Earls Court 2 was filled with thousands of marketers from all over the world discussing the latest developments and I should point out catching up on the gossip at one of the many bars! Every industry needs its own showcase event and although the IDMF has now been running for numerous years, attendance numbers remain high with many companies still considering it a ‘must’ for the diary.
This is just one yearly event that the marketing industry has to offer and I am sure that whichever sector you operate within, there are a multitude of trade events appearing on your calendar. Many suppliers consider these events essential, as do those who are loyal to the IDMF. However, in reality how many of these trade exhibitions really help companies achieve their end goal of reaching the SME audience or help them find the right suppliers?
For many companies who have a product, rather than a service, trade exhibitions are still a permanent ingredient within the marketing mix. Service companies obviously do exhibit, but in my experience it’s much harder to attract the passing delegate if you haven’t got something tangible to show. Obviously, you’d have to believe that it’s worthwhile for the exhibitors to be there (i.e. they expect to cover the costs of the event from sales-generated).
In reality, I’m not sure that this is actually true. The objectives of exhibiting companies vary: brand awareness, hospitality for existing companies and yes, even sales too! But ask for evidence of pay-back and in my experience you’ll rarely find it. There are just too many intangibles and variables and ways to hide the truth.
In theory, using trade events to reach small business seems to make sense; a much more effective use of a sales person’s time is to have the prospects coming to you. However, does the small business person even go to exhibitions? The truth is probably not unless they have a purpose, such as to view new stock, technology or if they are actively in a buying cycle.
These reasons need to be pretty compelling as taking any time out of busy office life is hard to justify. As a result, the number of small business owners and directors who attend such events are low and those wishing to attract large numbers of SMEs may want to reconsider, as exhibiting may not be the most cost-effective method.
Anyone who has ever had the responsibility of organising their company’s stand at an exhibition will know how expensive they can be. It is not only about the financial commitment required, but also the amount of resource necessary to make the event a success. This time commitment is often underestimated and viewed as only a few hours of organisation, though having been involved in many events, one thing is certain; they always require more time than is first thought.
Financially, although stand space seems to be relatively affordable, it is often the elaborate stand required to create the desired impact that increases costs. Competitors try to outdo each other in terms of offers, stand sizes and giveaways and, as such, costs spiral. Unfortunately, this means that when prospects arrive on the stand to discuss new business, the sales representative is more likely to be interested in speaking to the larger prospects where average order value is likely to be much higher than with an SME. There is, therefore, an immediate tension between the objectives of the small business person and those of the sales person.
There are events that lend themselves to selling general business products to SMEs but they are fairly few and far between, tend to be held on a regional basis and are slightly less interesting and lively than the last series of ‘Crossroads’. In my opinion, it’s not recommended as a serious marketing initiative.
If you are currently reviewing the ROI and measurement of an event then you may be facing a problem. Most companies include the cost of the investment in the stand; the hospitality and other add-ons that actually cost far more than the stand space. Adding all this in makes ROI look low. The exhibition organisers themselves have recognised this as a problem and have tried to encourage exhibitors to scale back on the investment made in the highly elaborate stands (for which they receive absolutely no benefit) and measure ROI on stand space only. If consistently low ROI increases, so will the drop-out rate of exhibitors.
Ultimately, my advice would be that trade events are not the best way to reach the SME market. If you do exhibit, you probably want to maximise your investment and swing some big deals; not devote lots of time in an attempt to educate the SME and then close a small deal.
Personally, I’m not a fan of exhibitions at all, but grudgingly acknowledge that they may have a role within the overall mix. If you want to sell to SMEs, I think you’d be far better advised to use an insight-driven relationship marketing strategy, using marketing media appropriate to the predicted value of the business. If you want an afternoon out of the office or an out of hours drink, then go for it!
