Trade shows are usually a big waste of money for manufacturers. When you include the cost for booth space, booth collateral, and travel expenses, even a small 10 foot booth at a 3 day show can cost $20,000 or more. Many manufacturers will spend upwards of $500,000 for shows that require shipping large equipment and renting large booth spaces. And don't forget to include the opportunity cost of having your sales team standing at the booth instead of doing their usual selling "thing".Here are 5 common areas where manufacturers waste money on trade shows:
- No lead follow up. This is the single biggest waste. Here's the typical scenario; you send your sales team to a show for 3 days. They man the booth for 8 hours a day collecting cards and making notes about visitors. After a full day on the show floor, they're exhausted and might have enough energy for answering a few critical emails before they go out to dinner. At the end of the show, each sales person excitedly gathers his leads and heads home. The next day in the office things are piled up and waiting; there are voicemails, hundreds of emails, demands from the boss and other colleagues. That stack of leads gets set aside until he can get caught up. Several days (or weeks) later, there sits the sorry stack of leads who have long forgotten about their visit to your trade show booth. Boom - wasted money.
- Logo promotion. Walk around any trade show and look at the booth messages. I guarantee that at least 85% highlight the company name and logo as the booth headliner. Unless you're Caterpillar, Boeing or some other well known brand, your logo and company name are meaningless. Sorry, but it's true. You're brand name and logo do not give visitors a reason to stop at your booth. It's a good idea to put the company name and logo on the booth, but not as the headline. Instead, tell them what you do.
- Inattentive booth personnel. While you're cruising the trade show aisles assessing the messages (number 2 above), observe the booth personnel in their natural habitat. Many, maybe most, of the people tending the booth are checking emails, chatting with their colleagues, or chatting with their booth neighbors. Others are eating or drinking. Some even have their laptop out for more important work. While these tasks are occurring in the booth, prospective customers are walking by. After all, who wants to interrupt a phone call or lunch to ask about the company offering? If you're spending the money to exhibit at a show, make some rules for booth personnel; no eating or drinking in the booth, no cell phones or laptops in the booth, proactively engage people walking the floor, and no sitting in the booth.
- Nobody shows up to man the booth. This might sound a bit surreal, but it happens all the time. The company pays for the space, ships the booth and there it sits as unopened crates piled in the middle of the booth space. 'Nuf said.
- Lack of promotion. 80% of show attendees choose which booths they will visit before they step foot on the show floor. You need to let them know you'll be there, where the booth is located and give them a reason to visit your booth. Pre-show promotion and post-show promotion throughout multiple channels are essential to getting a return on the trade show investment. Hint: you have to do more than just tell them you'll be there. Give them a compelling reason to stop by and visit.
Trade shows are a very popular marketing tactic among manufacturing companies and their sales teams. It is the very nature of a sales person that compels them to love the trade show. They get to be the center of attention albeit one of many centers of attention. Sales people love to say hello, shake hands and re-acquaint with their customers during a show. Trade shows are mostly a social event with the booth visits, drinks, dinner, coffee and snacks all shared with their customers and prospective customers. Some would say that trade shows are nothing more than a boondoggle for event exhibitors as well as the attendees. I would not go that far because I've spent my share of hours standing on thinly padded carpet over hard concrete floors with aching feet, an aching back and not much to show for my efforts. Trade shows can be very tough on the body in spite of the boondoggle nature. But, the more popular the destination, the higher chance of the show being a boondoggle for exhibitors and attendees.
The Sales team will fight you to the death to keep the trade show bandwagon going. If you ask your sales folks why they want to do so many shows, you'll likely get these answers:
- "I can see a bunch of my customers at one location and one time."
- "It's the only chance I have all year long to see my customers."
- "We've been going to show ABC for years, if we stop going now, everyone will think we're going out of business."
Each of these are legitimate but weak arguments that can be rebutted with a good marketing strategy. Other reasons some companies go to trade shows is to actually sell product on the show floor. This may be the one instance where a trade show might produce a decent return, however, it certainly should be analyzed. What is the gross margin for products sold at a show? You actually might be losing money if you include the costs of the show and the time invested by staff. Is it worth spending $1 million on a show to make a profit of $250,000? You'll have to be the judge of that.Let's look at some numbers.
Suppose you rent a 200 square foot booth space at your favorite annual show for a fee of $10,000. You fly in 4 of your sales people from around the country and also bring in a couple of product managers from Europe. Add up the travel costs, food, shipping, booth setup and event extras and you're looking at a $50,000 expenditure for the 3 day show. Let's say the venue is able to bring in 25,000 people to the show. You get about 150 visitors to your booth over 3 days and collect about 100 new qualified leads. Not too shabby? Here are the numbers:
- Cost per thousand exposure = $2000, a good trade magazine ad costs about $30 per thousand exposures.
- Cost per visitor = $333.33, this is only a visitor, not necessarily a qualified lead.
- Cost per qualified lead = $500.00, you can do a lot better than that with other types of marketing activity.
- Try a webinar. A webinar with a well chosen topic can easily garner hundreds of registrants and hundreds of attendees. Not only is the cost per registrant about 10% that of a trade show booth visitor, but you capture their attention for any where between 30 and 60 minutes. Which is more valuable, a 3 minute visit to a trade show booth or a 30 minute conversation that actually gives the person in your target audience something they can use?
- Try a live seminar. A live seminar can draw anywhere between 20 and 200 attendees, again depending on the subject matter. Which would you rather have, 100 people stop by your booth for 3 to 5 minutes or 20 people to spend the day with you at a seminar?
- Try exhibiting at a virtual event. These types of events have been proven to engage better and more people than live trade shows. The virtual show is not tried and true, but they are worth investigating.
- Instead of spending $2 million on trade shows, spend half on shows and spend the other half on a digital marketing strategy, tools and personnel.
Your sales team won't like #4, so be careful to prepare your base of support on that one. It is also a good idea to start small as far as stopping the trade show train. Coming up with a proposal to drop 50% of shows will likely get you more push-back than proposing dropping 5% or 10% per year.