Selling Cities & Venues Today

Four Themes

1. Power Shift

2. Conventions & Tradeshows 2.0

3. Convention Centers 5.0

4. Selling Cities & Venues

Part One: Power Shift

Attendees

Exhibitors

Show Producers/Contractors

Power Shift

Attendees

Exhibitors

Show Producers/Contractors

• Faster, better, cheaper information

• “Attendees are well informed due to information available on the Internet.”

• “They are further along in the buying process when they get to the show.”

Attendee Power Shift

• Site-selection: Where’s the built-in attendance base?

• Site-selection: Which city will draw?

• Attendees not staying as long

• Booking outside the block

• Confused exhibitors

Buyers Have Powerful Tools

Less control

Part Two: Conventions & Exhibitions 2.0

Show Producer Trends

• 5% gross revenue growth forecast

• Focus on cost containment

• Hard to launch new B2B shows

• Exhibitor product cycles don’t fit show schedules

• Empowered attendees/buyers

• Closer focus on site-selection

• How to add more value beyond the show days?

Challenges

• Consolidation on attendee and exhibitor side

• Growing high-quality attendance levels

• Competition from other show producers

• Competition from Web and other media

• Containing costs while raising experience quality; Travel and hotel costs

Opportunities

• International show launches

• Co-location

• Targeting new related market sectors

• E-marketing

• Working more closely with exhibitors/sponsors

• Global economy

Tradeshows 2.0

• What’s the next version of conventions and tradeshows?

• Let’s look at retail:

– Data-driven customization/segmentation and new store layout

– More staff training

– Services beyond merchandise and warranties

– High end or low end

Either High End or Low End

Can you be both a price competitor and standout customer service provider?

How Real is Venue Management Commitment to Customer Service?

100%

88%78%

40%

0%

20%

40%

60%

80%

100%

120%

CustomerService is VERY

Important

Track CustomerService

Train Staff Have DoorGreeters

Source: Tradeshow Week Venue Management Survey August 2005

Percentage of Convention Center Managers

Tradeshows 2.0 – The Next Version of Shows

• Associations continue to evolve

• More specialization; more segmented floor layout

• Enhanced data and information collection

• Additional services; custom event management

• Linkage with Web sites, i.e., eBay Live show

• Smaller or larger? Shorter or longer?

• Next version of exhibit booths?

More value

Part Three: Convention Centers 5.0

-8.0%

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

12.0%

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005

Supply: Venue Exhibit Space Demand: Net Square Feet

Annual Growth Rates

Supply and Demand Growth

61.3 62 63 63 63.4 65.5 67.672.4

77.280.5 82.3

89.6

0

10

20

30

40

50

60

70

80

90

100

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2009

Total Convention Center Space Square Feet

332369 389

440

050

100150200250300350400450500

1990 1995 2000 2005

Number of Convention Centers & Exhibit Halls

1.8% compound annual growth rate (1995-2005)

173,021

145,876

48,547

187,066

157,243

56,111

0

20,000

40,000

60,000

80,000

100,000

120,000

140,000

160,000

180,000

200,000

Total Exhibit Space Prime Exhibit Space Meeting Space

2000 2005

Average U.S. & Canadian Venue 2000 & 2005

Average Meeting Rooms 2000: 25

Average Meeting Rooms 2005: 26

500,000 or more8%

100,000-499,000

45%

50,000-99,00032%

25,000-49,00015%

Convention Center Size Breakout Square Feet

1314

3

0

2

4

6

8

10

12

14

16

New Venues Expansions Renovations

August 2004 to July 2005 Building

1.8 million square feet of exhibit space

49

6557

7787

94 9687

6857 62

70

0

20

40

60

80

100

120

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

In-Process New Venues and Expansions

29 new venues in-process; 41 expansions; 8.2 million square feet of exhibit space

Are you studying or building a new venue

or expansion?

Is a major competitor?

When Expanding or Building New Venue…

• What does our city’s tourism, corporate and convention brands stand for?

• How can new venue investments link all three of these distinct aspects of the community?

• What does our current venue’s brand stand for?

• Are the key stakeholders and decision-makers in the development process up to speed with trends in the national convention, exhibition, hotel, travel and media industry?

When Expanding or Building New Venue…

• What will the convention and meetings industry in our city and competitive set look like in ten and twenty years?

• How can we develop new services to become the best of class venue in our competitive set and to compete at the highest level among North American venues?

• Are we hoping to compete mainly by building a new facility?

• Are we committed to investing in marketing and new service development to compete and better service event planners, exhibitors and attendees?

Venue Evolution

Fairgrounds, Coliseums, Hotels

Civic Centers and Box-Like Convention Centers

Contemporary Convention Centers,

Resort Meeting Facilities

Civic Icons, Super Hotels

Today’s State of the Art Convention Centers

Market Requirement Solutions

Cater to corporate clients- High-tech auditoriums- Large ballrooms with high finish- Hotel-quality food, decentralized food service- Ample number of meeting rooms

Cater to local community events- Large multipurpose rooms with upscale finishes- High-tech auditoriums- Efficient transportation options

Increase attendee productivity- Minimize walking distances- Ample number of meeting rooms- Wireless Internet access- Efficient transportation options, movable sidewalks- New technologies (e.g., electronic badges, kiosks)

Speed tradeshow turnover rates - Ample storage areas - Portable equipment (e.g., stages, risers, lighting) - Dedicated create storage on-site - Plenty of dock space - Comfortable environmental conditions

Source: Building Design & Construction

• Remarkable 20-year transformation

• High-tech, high-profile, award-winning design

• Complex businesses -- important to communities and political structures

• Differentiation is gone; discounting and incentive funds increasing

• Facing commoditization again

Venues Today

Tomorrow: Design for Individuals

• More functionality

• More intimate feel, less overwhelming, stark spaces

• Better integration, connection with city elements

• Board rooms; small breakout rooms

• Lounges – “Admirals Club”

• Comfortable chairs and sofas

Institutional

Quality battle

Part Four: Selling Cities & Venues

How to Respond?

Trend Issue Response

• Power Shift Less control Learn how shows market to attendees; co-market with them; focus city and venue brands to attendee experience

• Conventions & Tradeshows 2.0

More value Accommodate new service offerings; partner with shows to offer more service – learn their particular industry issues

• Convention Centers 5.0 Quality battle Continue to raise the bar; offer new services to shows, exhibitors and attendees – and the local community; design not so institutional

Power Shift

• Site selection – prove your drawing power

• Focus brand to attendees and exhibitors

• Attendance marketing: – Harness all state and local resources and expertise (from

Governor’s office, to labor department, to sports teams, to universities…)

– Hire marketing managers to work solely with shows– Offer marketing payments, partnering – Earlier signage… not just welcoming signs in airport but signs

marketing the shows four to six weeks out

Convention Centers 5.0 – New Services

• Consulting on venue and hotel usage best practice

• Research

• Help exhibitors reach attendees

• Web services

• Entertainment

• Learning labs

• Full-time marketing staff

• Market to groups that launch shows

Show Producers with Recent Launches• Advanstar Communications Inc.

• ASI Show, Inc.

• Centric Events, Inc.

• Clear Channel

• CMP Media, LLC

• ConvExx

• Conferon Expositions

• Cygnus Expositions

• Diversified Business Communications

• dmg world media

• EH Events & Education

• Hanley Wood Exhibitions

• IDG World Expo

• JD Events• Karel Exposition Management• M|C Communications• Macfadden-Protech• McLaughlin Associates Corporation• Messe Frankfurt, Inc.• Motor Trend Auto Shows, Inc.• National Trade Productions, Inc.• Offinger Management Company• Oxford Publishing, Inc.• PennWell Corporation • Penton Media, Inc.• Pulvermedia• Questex Media Group• Reed Exhibitions• RJ Promotions• Spargo (J.) & Associates, Inc.• Unicomm• VNU Expositions, Inc.• The Woodworking Shows

Show Producers with Recent Launches

Sales, Marketing and Service

• Sensory marketing, music, etc.

• Higher level customer service

• Differentiation

– Become the “attendee marketing venue”

– The “customer service venue”

– “They’re not a facility. They are our indispensable partner”

Venue Evolution

Fairgrounds, Coliseums, Hotels

Civic Centers and Box-Like Convention Centers

Contemporary Convention Centers

Resort Meeting Facilities

Civic Icons, Super Hotels

Partner

Commodities

Goods

Services

Experiences

Transformations

Most events, service providers and venues/hotels

Winners over next decade

Guest Transformations

Q&A

• Associate Publisher & Director of Research Services, Tradeshow Week

• As head of Tradeshow Week’s Custom Research, Michael produces proprietary research, consulting and marketing projects for leading exhibition industry organizations around the world. He works closely with exhibition industry leaders, corporate exhibitors, entrepreneurs, investors and real estate developers to provide high-value strategic information, analysis and recommendations. His client’s include nearly all industry leaders in every segment of the industry as well as leaders in the investment and consulting community. Michael is frequently quoted by major newspapers and national magazines such as The Chicago Tribune; The Los Angeles Times; Newsweek; The New York Times; and The Wall Street Journal. In January of 2003, he was selected as a “Person to Watch” by min’s btob newsletter. Since 1999, Michael has been a presenter at over 40 industry conferences. He is also the research director and editor of Tradeshow Week’s syndicated Executive Outlook research surveys.

• Tel: (323) 965-5317• Email: mhughes@reedbusiness.com

About Michael Hughes