Trade Shows Sick but Not Dying

It has been pretty quiet in B2B land in the first week of the New Year as managers try and assess how bad the first quarter is going to be. Plans are being made for further redundancies in many of the b2b media houses. Meanwhile real concern is now being expressed about the outlook for trades shows. Peter Kirwan notes the recent Lex article (availale to FT subscribers only) which implies that the trade show model is structurally as well as cyclically damaged.

We have postulated for some time that the demise of print publishing will infect trade shows too. Attendances, as the FT points out, have been going down for some years. Meanwhile the cost of attendance for exhibitors is punishing. The UK is one of the most expensive places in the world to exhibit. A squeeze on budgets, an urge to avoid unecessary travel and a niggling doubt about the cost effectiveness of shows all bode ill. Thats one of the reasons that UBM is experimenting again with "virtual shows".

Rather as with magazines, the answer is to reinvent the trade show model. Most organisers will already tell you that a room with rows of booths is not the best way to win new visitors, but few organisers do much else.

Exhibitors don't want to exhibit. They want to meet potential customers and seed new orders. A growing area of interest for organisers is bespoke events where a tailored event solution is created for a customer. When an exibitor spends £20000 on a booth at a trade show they spend four times that on everything else (travel, stand design and build etc), most of it with contractors not with the organiser. If trade show companies thought about how to take the £100000 from the customer by building a bespoke event solution for them and their customers, new profits can be made.

Meanwhile, in the short term, expect a rough ride for this years rebooking of exhibitors at 2009 trade shows.

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• UBM looks to virtual events

The Future of Publishing, Computing the Magazine

We noted the merger of IT Week and Computing a few weeks ago. Now its publisher Graham Harman, is interviewed in Press Gazette and his argument dissembled by Peter Kirwan.

Harman says lots of things in his interview with which this author would agree,

“You can’t just stick to the old practices and say ‘that will do’.” and

“You have to say to yourself: ‘If I was launching into this market now what would I do?’” and

“We have seen the writing on the wall the way that the revenue models and the way that the information needs of our readers has changed, and we’ve decided that we need to do this now"

What happens in the tech sector is often a lead indicator for what will happen in other b2b markets - so we should take all this seriously. Twenty years ago, the professional IT press was hugely profitable, with 50 to 100 pages of job ads published each week in each of the two main weekly titles. Today, Computing is a shadow of its former self with just a couple of pages of job ads and a declining display revenue.

I am beginning to think that Peter Kirwan and I should go into businsess together, as I find it hard, as usual, to disagree with his point that if Incisive was to act in the way its analysis suggests, the weekly magazine would be killed off today. No one, he argues, would launch a weekly IT title today so why keep the ailing beast alive? There is more to it than wanting to squeeze the last drop of profit from print though. There is also pride. Computing has fought a bitter war over thrity years with Reed rival CW and, rather like competing generals in WW1 trenches, nobody is going to give an inch to the other even nothing is to be gained by winning a point of share or foot of territory from the other.

What is need here is some management bravery and to honestly answer the challenge that Harman puts, which is, in terms, to imagine what you do if you were launching today - and then do that. It is only a question of time before Computing closes. It might not be this year or even next, but close it surely will. In the meantime huge management time and effort will be devoted to keeping its heart beating at the expense of developing the new model.

Incisive are showing the first signs of realising that the publishing game is up. Theyhave noticed that print is dying. They believe it but haven't yet come to terms with it. They have a real opportunity to set the lead and build a new future whilst their competitors are still pretending that this is just a cycle and a course of anti biotics will cure them. Will they take it? Will any of you?

Informa Going Down

After months of speculation, private equity interest in Informa has materialised at a rather lower value than shareholders would have hoped, acccording to this interesting analysis by Peter Kirwan.

The standard thinking is that Informa is a solid B2B stock. It is a business with scale, it is not very exposed to advertising, has lots of events and subsctiption based activity and is a well managed beast. Even with all that in its favour valuations are softening.

Readers of this blog will not be surprised then, when the value placed on RBI which is smaller than Informa, is exposed to the advertising cycle, has little events and subs based activity drops in the second round of bids.