Earlier this week, I reread an article that our 2009 EDPA President, Dan Cantor wrote last fall titled, “Is Our Industry Model Obsolete?” That’s when it occurred to me that Dan was drafting this article at the same time that the EIC was being formed and created.   CEMA, EACA, HCEA, TSEA and our association, the EDPA were all coming together to work for a common good; “PUTTING THE EXHIBITOR FIRST”. Over six months have passed, and it’s already interesting to see which parts of Dan’s article have come to fruition, where we’re heading, etc. As an industry, we still have lots of work to do.

For this weeks EIC blog entry, I’ve decided to submit Dan’s article word-for-word as it appeared last year. For those of you who haven’t seen it before, we’d love to hear your initial thoughts on it. For those who read it then (my guess is you’re all EDPA member companies) please take a few minutes to re-visit it again here. We’d like to get your latest thoughts too.

IS OUR INDUSTRY MODEL OBSOLETE?

By Dan Cantor, EDPA President Emeritus

I am reasonably certain that our national economy will begin to significantly improve in 2010, and our industry will show signs of life as a result—but we have a choice to make at this moment in time. For our industry, we have the ability to choose between 1) a subdued recovery, dampened by the lackluster physical appearance and extraordinary cost of tradeshows; or 2) a robust recovery that is supercharged by a new business model from which exhibitors and all industry segments will benefit.

The EDPA positions on the business practice of packaging or bundling of “exclusive” with “non-exclusive” services, and the peculiar fees that lead to unpredictable show costs and exhibitor dissatisfaction, are well known. The marketplace does not reward this kind of activity for very long; consequently, we are confident that reasonable people can collaborate on a solution that facilitates fair competition among all designer-producers, including those that perform exclusive services in convention centers.

But our industry has a much bigger challenge: our business model is not globally competitive, and our industry will soon be in crisis as a result.     Exhibiting in convention centers outside the U.S. costs a fraction of what a similar appearance costs in this country. Global show schedules  for U.S.-based companies have increased dramatically because of the relative strength of economies outside the U.S., but also because overseas events are far more cost effective. Without significant changes, this trend will continue, and each year event marketing professionals at U.S.-based companies will allocate more dollars to “outside the U.S.” events, which are gaining in prominence. They will also allocate more dollars to virtual solutions, which are a necessary complement to live events, but are also replacing small tradeshows and private events at a significant rate.

Exhibitors can no longer juggle upwards of 30 different charges or fees, many of which are unpredictable (and very challenging for any budget compliant event manager). We have to address floor-space costs, material-handling issues, venue restrictions, work rules and booth regulations, which make exhibiting in the U.S. unnecessarily restrictive and costly.

Each year, our customers opt for smaller, lighter, less-magnificent exhibit solutions because we use weight as the primary variable in the calculation of material handling charges. If we do not actively collaborate to determine a better measure, we will continue to see tradeshow presentations become more lackluster, and the average size of events decrease. This trend will exacerbate the overall decline in tradeshows, simply because they will be less compelling and differentiated against online sources for information and engagement.

Soon, our municipal boards and legislatures will realize that their recently expanded convention centers are being negatively impacted by these trends, and they will attempt to exert more control—which will cause us to focus on their model instead of ours, and be less customer focused.    Think Wall Street, the auto industry, and health care reform; governments react when industries are not proactive.

The good news is that face-to-face marketing is a proven medium that deserves its place at the top of the marketing spend, second only to Web marketing. All industry segments acknowledge that the current model is problematic, and must be modified to enhance the viability of tradeshows. The EDPA is supportive of recent initiatives to develop industry best practices, and is actively engaged in dialogue with other associations and constituents—and encourages all interested parties to participate.

Let’s continue the dialogue!