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Are trade fairs and exhibitions worth it? print Print

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Visiting a busy trade fair or exhibition often makes you wonder if your business should be there too. This guide debates the pros and cons and offers some tips on how to get more out of your investment if you do decide to exhibit your goods or services.

Many business people wonder if attending trade fairs is worth it, especially, when the stand alone, for example, may cost you $1,500 for a three-day fair. It’s always difficult to know if competitors or similar businesses gained enough business from a fair to justify the expense.

Should you be there?

The simple question to ask yourself is why exactly do you want to attend this trade fair? Just because all your competitors will be there is not a good enough reason.

If your business is new, you’re more likely to want to attend, as you need to get people aware of your business. In this case the cost of the fair should be treated as a promotional cost. But still go through a cost/benefit analysis. Here are some factors to consider:

The five key reasons why trade fairs can benefit businesses:

1) To increase sales

This tends to be the most common goal: you attend to display products or details of your service in an attempt to boost sales. If this is your main motive the best way to determine the viability of the fair is to calculate a simple break-even point. For example, if the fair is going to cost you $2,000, and your gross profit for your business is 20%, then you’ll need to do $10,000 worth of business to cover the cost of the fair. Now ask yourself: is this likely? For instance, if you’re a consultancy business charging by the hour at say, $25 per hour, then to cover the cost of the $2,000, you need to gain 80 hours of work from the fair just to cover your costs.

Using this example, let’s say that your business gets 81 hours of business from the fair. The profit gained would only be $25, as the rest goes to paying for the fair. So $25 divided by 81 hours means that you’ve been working for 31 cents per hour! This exercise is important: too many businesses attend trade fairs that have not done their homework and cannot figure out why they are not making any money.

Doing something different

A business that had attended a trade fair for several years decided to pull out in the current year and do something different from all their competitors. They instead invited a number of clients, guests and prospective clients to a function held at a convention centre. The clients were offered drinks and snacks and shown a brief presentation on the latest products which were then demonstrated. Everyone enjoyed themselves. The business had no other businesses competing for attention and had complete control of the proceedings. Best of all, the cost was only half that of attending the trade fair, and the proceedings were over in a couple of hours.

You should also consider what else you could do with that $2,000 in terms of promoting your business. Other options might well be more effective than the fair. As a rule of thumb, therefore, be wary of attending trade fairs just to make sales. Money does not tend to change hands immediately, and if it does, the amount is usually too small to cover costs and your time.

2. To gain brand awareness

In this case, the only reason you are attending is to promote your business name to your prospective customers. This is fine if it’s your main motive. New businesses may wish to try this tactic, or existing businesses trying to gain new customers or expose themselves to a new market. Again, consider what else you could do with the investment to gain the same amount of awareness.

3. To get contacts and names

Your prime aim in attending a fair may not be to make an immediate profit. Often getting names for further follow up is the best you can expect from trade fairs. If you do this properly, then a trade fair can offer you great value. If this is your main motive, then make sure you have some efficient means of collecting names, such as a list of all the people that have expressed interest in your stand. You should then contact these people within one week after the fair has finished, either by a telephone call (this is best) or a letter. You can also gather another list of names from people that may not stop to talk. The easiest way to do this is to hold a competition. Giving something away for free encourages people to put their names or business cards in for the draw. For more ideas on how to capitalise on this tactic, ask for the related Solution Guide ‘Build your business through direct marketing.’

4. Researching the competition

Trade fairs and exhibitions are wonderful places to research the competition and pick up all their promotional material. If you’re not known to them, you can do some direct research by talking to them, or you can send along someone else to pick up the information. No doubt they’ll be doing the same to you!

5. Making new contacts

There is a fifth, more intangible but still important reason for attending trade fairs. Most business people who have exhibited at trade fairs will tell you that they offer good opportunities to extend your business contacts: both of potential customers or clients and suppliers. The networking at such meetings is hard to quantify in dollar terms, but can pay off in the future in all sorts of unexpected ways.

Factors to consider

Who’s running it?

The success of a fair depends on many factors, such as entry fee, its focus, other exhibitors, and the promotional efforts and ability of the organisers. Be wary of fairs organised by people that have not had much experience in the industry, and may only be in for a quick dollar. Do your homework first on the organisers.

The marketing budget may be critical

Fairs flourish on marketing. If they are well marketed, the crowds come. If the organisers skimp on marketing, the attendance is likely to be down. Ask the organisers for details of their marketing plan:

  • How much do they plan to spend on TV, radio and newspaper promotion?
  • How many people or businesses attended last year?
  • How many do they expect this year?
  • How are they going to get those numbers?

Ask for a list of businesses that have already signed up. You can then ring some of these to find out how they feel about the fair: “I understand you’re exhibiting at the fair. I’m presently trying to make up my mind. What made you decide to attend?”

Anchor exhibitors

Are there any ‘anchor exhibitors’? In the same way that large anchor tenants in a shopping mall pull in the customers who also shop at the surrounding smaller businesses, so a few well-known names at the fair can attract more visitors. Lack of such big name exhibitors may be a warning signal that the fair might not be successful.

Can you piggyback?

Before you sign up for a stand all on your own, consider if you can piggyback on someone else’s stall or share the space and costs. This could work well, for example, for two businesses that complement each other. For instance, a business selling digital cameras could jointly exhibit with a business that specialises in colour printers and special photographic paper. The advantages of sharing go beyond the cost of the stand itself. It looks better to have a full stand, not a half-bare one all by yourself, and more people could be attracted to a stand with a wider range of products/services. You can share the other costs involved too. For instance, you’ll need to staff your stand for the full time of the fair. If you don’t have staff, you’ll have to be there yourself. If things get very busy it can be tricky taking even a toilet or meal break. Sharing a stand allows you to come to some joint staffing arrangements or at least have someone always on the stand.

What type of fair is it?

Most trade fairs are of two kinds. The first type is the generic ‘business’ trade fair. Many different types of businesses exhibit, and there is no specific theme, except ‘business’ in general.

The second type of fair offers a specific theme, such as a craft fair or computer show or franchising exhibition. As a rule of thumb, industry-specific fairs are more likely to be of use to your business.

Sometimes it’s wiser to be a follower

Be cautious if you’re invited to exhibit at a new fair. Most of us have a natural desire to be in ‘on the ground floor’; that’s where the opportunities are said to be. But if the concept is unproven and you don’t know much about the organisers or their track record, it may be better to stand back and be a follower, not a leader. If the fair is a success, there will always be another one. If it’s a flop, you’ve saved yourself time and money.

Tips for greater success at trade shows and exhibitions:

  • Set clear targets for the event. These might be sales targets, or gathering a certain number of ‘hot prospects’ or arranging a set number of follow-up meetings with potential customers. Targets allow you to monitor the success of the event, so that next time you have a clearer idea than just “well, we were busy” of whether the event was worthwhile.
  • Never go into a trade fair under-prepared. Make sure you have business cards, handouts, videos, competition forms, staff to look after the stand, etc.
  • Don’t skimp on signage. If you’re going to the expense of exhibiting, make your stand worth looking at. All signage should be top quality because it sends out the first and perhaps most important message about your business. It’s worth paying for large, professionally written, bright signage. Signage and any specially made exhibition stands can be saved and used again.
  • A gimmick to attract attention can also help. For instance, instead of static displays, have a continuously running video projected onto a screen. Or use revolving stands to turn some of your products into mobiles.
  • Fairs often include talks in lecture rooms adjoining the exhibits. If appropriate, offer to be one of the speakers.
  • Work the crowds. Train the people staffing the stand to be more assertive. Instead of passively waiting for people to come into the stand, work the crowds in the passageway. Ask them to sign up for a free competition or ask them some questions designed to get them interested in your products or services.

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