Exhibitions – down but not out

Nothing holds a candle to trade fairs when it comes to meeting up and sharing experiences. This past year may have shown us what life without tyre shows looks like, but it hasn’t offered us much in the way of alternatives.

The business environment for show organisers wasn’t always a bed of roses even back in the days when corona was just a drink served with a slice of lime or lemon, and Messe Essen learned a hard lesson about exhibitor loyalty with when The Tire Cologne (TTC) stole its Reifen show’s thunder several years ago. The IAA Cars show in Frankfurt in September 2019 also served as a warning that exhibitor loyalty isn’t guaranteed.

Superior Industries in turn commented on the many exhibitor no-shows at IAA Cars when announcing that instead of exhibiting at TTC in 2020, it would analyse its presence at major events to determine whether participation “achieves the desired effect and attains a healthy relation between investment and result.”

The wheel manufacturer was by no means the only firm to express such an opinion, yet at the same time many companies voiced their commitment to shows such as TTC. This sentiment is reflected in statistics from German trade fair industry association the AUMA, which shows that overall exhibitor numbers and exhibitor stand space at trade fairs slightly increased in 2019.

70% of 2020 shows cancelled

Then came corona and lockdown. The AUMA reports that around 70 per cent of the shows planned for 2020 in Germany were cancelled or postponed, and from the approximately 28 billion euros which the organisation of exhibitions contributes to the country’s total economic output in a ‘regular’ year, only 6 billion euros remained. Just 114 of the 355 international, national and regional exhibitions planned for 2020 were held. TTC was one of the casualties, with Koelnmesse and the German Tyre Retail and Vulcanisation Trade Association (BRV) announcing its postponement on 18 March 2020.

Six months later they presented their concept for a show in these new and strange times – a “hybrid trade fair” planned for May 2021 that would combine a smaller version of the biennial show supplemented by a digital element, TTC@home. Or in other words, an event that still required exhibitors to travel to Germany and to invest in flights, hotels and floorspace, but would even in a best-case scenario attract fewer on-site visitors. Its highly questionable whether this represented a convincing offer for firms already weighing up the relationship between investment and result.

We’ll never know for sure, as yesterday Koelnmesse gave the long-anticipated confirmation that it would again postpone TTC. At the same time, it announced the cancellation of the TTC@home virtual show, a decision that indicates a lack of exhibitor support for this format on its own.

Restrained enthusiasm for digital shows

AUMA confirms this lukewarm reception to digital events. It recently reported on a survey jointly taken with three major German industry associations which indicates that while 17 per cent of the 427 companies they represent used digital events as a substitute for exhibitions in 2020, many want to shelve this commitment once physical trade fairs again become a possibility. The associations found that 48 per cent of the respondent companies intend to continue relying on physical trade fairs in the future, supplemented by digital events. Furthermore, 14 per cent said they don’t view purely digital events as an alternative even if traditional trade fairs can’t take place. Only 21 per cent regard virtual presentations as serious alternatives to real trade fairs, even in the long term.

“In total, almost 50 digital events have taken place in Germany in 2020 as a replacement for cancelled trade fairs,” shares AUMA. “At the same time, the concrete business results are obviously rather modest. Exhibitors have achieved on average a quarter of the benefits of a real trade fair participation with such format; 30 per cent even achieved a maximum of only ten per cent, while peak values of 70 per cent and more were achieved by only three per cent of the companies surveyed.”

“Certainly, the relatively limited experience of those involved with digital business events also plays a role here. There is no doubt that they currently have an important function in maintaining customer contacts and providing information,” comments Jörn Holtmeier, AUMA managing director. “However, given the very different assessment of the benefits of digital and real events, it is hardly conceivable that purely digital variants can become a fully-fledged alternative to physical trade fairs.”

What’s more, the survey showed that personal contact, live product presentations and the acquisition of new customers were the most important arguments for companies to participate in trade fairs. The physical presence of people and products obviously makes the difference in business success.

Going it alone an option for some

So where does this leave companies who rely upon exhibitions and trade fairs as a platform for presenting new products and increasing brand awareness? The big names may be tempted to go it alone, as BMW Motorrad recently said it would when announcing on 26 January that “new live and digital formats will increasingly take the place of traditional trade fair appearances” in the future. In place of attending the leading two-wheel motor shows, EICMA in Milan and Intermot in Cologne, BMW Motorrad intends to approach its communications strategy in a more targeted manner.

“By using our own trade fair-independent live and digital formats we cannot only time world premieres and product launches more flexibly, but it also enables more intensive interaction with all target groups as well as an increased information reach,” shares BMW.

But this approach doesn’t offer an alternative for companies lacking BMW’s profile and marketing budget. The good news for shows such as TTC is that, according to AUMA, 42 per cent of companies recently surveyed said they believe trade fairs will remain or even grow in importance over the next five years. Given current circumstances, this is a remarkable response.