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Soaring Gas Prices Hitting Trade Shows Hard, Too

Publishing events start to feel the pinch.

By Matt Kinsman

Soaring gas prices, airfare and hotel rates are now affecting one of the largest growth areas for publishers: magazine events. While American Business Media says events have eclipsed print as the largest revenue stream for its members, skyrocketing attendee travel costs on the b-to-b side and host travel costs on the consumer side could dampen the party. 

According to a recent survey by the Society of Independent Show Organizers, 50 percent of respondents says they are moderately concerned about increased travel costs on their event business, 39 percent are greatly concerned and 11 percent are modestly concerned. Forty-one percent of respondents say they expect to see a 10 percent reduction in expo attendance over the next 12 months.

And it's not just expositions and conferences. Buyer-seller events-in which the publisher recruits a select audience for a sponsor (and covers much of the attendees' cost)-have gained in popularity in recent years but may no longer be as economically viable. "We pay our attendees way so it's hurting our budgets dramatically," said one respondent. 

And with most event venues booked at least a year (and often several years) in advance, re-evaluating attendee revenue can be especially painful. "Mostly I am downgrading my attendee revenue estimates and managing expectations related to attendance," says Scott Wolters, director of tradeshows and conferences at BNP Media.

To cut costs, publishers are considering doing less direct mail, less travel (including conducting more site inspections online and through word of mouth) and less outsourcing (leveraging more internal staff for pre-event and onsite duties). For attendees, publishers are offering bigger discounts for early registration, securing cheaper hotel prices with aggressive room blocks and opting for more airport venues. 

Still, the reality is attendees are limiting their travel. "People are not going as deep into their organizations as they used to as far as bringing a number of attendees," says Galen Poss, president of Hanley Wood's Exhibitions Division. "They used to bring seven or eight people. Now they bring four or five. Instead of staying three or four days, they stay two days."

More ‘Bang for the Buck' 

Hanley Wood has added "Live Action Clinics" -a series of training seminars for attendees-that take place on its exhibit floors to drive exhibitor traffic and give attendees something extra. "We're trying to build a value proposition-if people are still spending the same amount of money at your show you have to give them more for your money when things get slow," says Poss.

Hanley Wood is also looking at co-locating some events, such as the Deck Expo and Remodeling Show, and the CONSTRUCT show and newly acquired TFM Show in 2009. "They will be held as a co-location so exhibitors and attendees get twice as much bang for the buck," says Poss.

Instead of cross-country tours, some publishers are turning to regional-specific events as well as smaller, one-day events. Make Magazine just enjoyed a better than 50 percent annual growth for the Maker Faire, which drew more than 65,000 attendees in May. "We're trying to bring Make, Craft and Maker Faire to regional markets so that people can attend without having to get on an airplane and in many cases, even avoid hotel stays," says associate publisher Dan Woods. "We are also beginning to host smaller one-day events."

Still, events remain attractive for sponsors and have proven resilient during past market slumps. "The face-to-face sector is usually later to go into economic downturns and, in many cases, can be fairly quick to come out of it," says Poss. "Exhibitors may hold back size of their participation but in many cases they don't pull out of an event because it sends a very confusing and troubling message to the marketplace."

By Matt Kinsman


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