I was at Interop/Web 2.0 for meetings this week. I also walked the expo floor talking to startups and attendees. It struck me how broken the whole “conference” thing is.
Vendors want leads but tradeshows are a notoriously poor source of qualified leads. At every company I have worked at, when we actually tracked leads all the way through to revenue I’ve never seen any real return from trade shows.
Attendees want to network and learn what’s new. Talks can sometimes give some “what’s new” perspective but the speakers are generally folks who speak/write/blog enough that nobody needs to see them live to get their content (I was told by one well-known presenter that he had 16 people attend his talk). Attendees can see what’s new at the expo of course but they will have to suffer a sales pitch few of them want in order to get it.
Networking is going on around the show, in hotel bars and restaurants and at vendor-sponsored parties (now there’s a great place to qualify a lead!). So, the attendees get to hang out and party and the vendors pay for that. Sounds like a pretty good deal for attendees but the vendors sound like suckers.
So you’re a startup looking for prospects. Is buying a booth at one of these conferences worth it? This is a case where it would probably be useful to apply the $100 bill test:
- Add up what you would spend on the show. It probably looks like this – air travel for 2 people – $2000, hotel for 2 people for 3 nights – $1800, food, taxi, etc for 3 days – $500, plus booth cost – $3000 for a 1 man tabletop, gets me a total of $7300.
- Take that number and divide by 100.
- Calculate the number of decent leads you could get by handing out $100 bills outside the Javits center to folks who answer yes to a question like “Are you an IT decision maker?” and give you their card.
- If that number is higher than the number of leads you would get at the show (in this case 73) – don’t go.
Oh yeah, and if your employees want to attend one of these conferences make sure they at least spend a lot of time at the bar at your competitor’s party.
A off-topic green footnote:
The EPA considers Trade Shows to be the 2nd most wasteful industry in the United States after Manufacturing. That is without even looking at the environmental impact of the associated airline and hotel industries that are also supported.
I agree with you on this for North American shows.
However, the Europeans, specifically CEBIT, have a better approach where buyers, sellers and partners are organized enough to do business at these meetings. On top of the trade show elements, they also factor in large social events for staff and customers. This model works because of concentration of effort and focus, From what I was told when I went, it was the one show a company would do in a year. The NA approach just doesn’t follow this model, they are too much like commercials and not enough like business meetings IMHO. RT
April,
Interesting post. Having just returned from VMWorld last week, I have to say I do appreciate where you are coming from…BUT…generating leads and networking aren’t the only objectives or benefits of exhibiting at a show.
First, let me say that not all shows are equal. Some shows can have more value than others. While that is a truism, it is easy to forget in these discussions.
Some of the other benefits include meeting with partners and key customers, analysts and press, providing a venue for “soft” marketing with prospects, and most importantly being seen by competitors and other industry luminaries.
The sad truth about certain shows, (VMWorld being one of them if you play in the virtualization space) is that like certain Hollywood red carpet galas, being seen in attendance is as important as what you do when attending.
As you know, marketing is the art of managing perception and reputation, and while being seen isn’t the only reason to attend a show, it is one which is hard to measure with the $100 test.
So, the net (IMHO) is that trade shows, like any other marketing activity need to be thought through, the objectives clearly defined in advance, and the results measured (not simply the lead->close #s) to identify if the expense was justified.
Saeed
Hi Saeed,
You’re right. There are still a few good, focused trade shows out there that do a great job for their segments. In general I find that those same shows are also good for driving leads because customers see them as critical to attend. I could imagine VM World being a show like that.
I’m less convinced that a competitor could gain an advantage over you because you weren’t at a particular show (unless they are getting the good leads you aren’t of course). I’d still measure ROI on the booth by revenue.
Last week I was at Interop/Web2.0 Expo for the sole purpose of doing press/analyst meetings. Not once was I asked why we weren’t in a booth (and frankly, I doubt the analysts I met with had even walked the floor).
I also really like the idea of taking the money you would have spent on a booth and doing something more creative around the show like the Iterasi Bus at Gnomedex which had loads of people talking. Another company I used to work for held a customer/partner event which was much cheaper than the booth would have been with a much bigger impact on key customers. If it’s worth doing (and some of them are for sure), it’s worth doing in a remarkable way.