Tradeshows can be a big expense (i.e., spend a lot of money and get little or nothing in return) or a productive investment delivering big returns. It all depends on how you view shows and how you manage your exhibiting dollars.
As a starting point, I recommend viewing exhibiting as a marketing, sales and customer relationship investment, not an expense. As with any investment, you should expect and plan for when and how you are going to generate a return.
In terms of an ROI target, you should be generating three to five dollars back for every dollar invested in a measurable manner over time. Returns can come in both hard and soft dollar values.
Let’s take a look at some budgeting and cost control best practices.
- The first budgeting area to look at is the percentage of your company’s total marketing budget allocated to exhibitions. A CEIR study found the average company invests 41.6% of their annual marketing budget on exhibitions. How do you compare?
- The second budget area to look at is how much to invest in a specific show. To establish a show budget, start by multiplying floor space cost times three if you have a small exhibit without a lot of labor costs, drayage and show services. For example, if floor space cost is $4,000, you should be investing at least $12,000 in the show. However, if you have a larger exhibit with a lot of shipping, drayage, installation and dismantle labor, and utility service costs, then budget floor space times five.
- The third budget area to track, manage and benchmark the areas money is being spent. A 2017 CEIR study benchmarked the major exhibit spend by areas along with the percentage of the dollar spent on each area:
- Exhibit Space 37.9%: The rental cost of floor space.
- Advertising & Promotion 13.7%: Print advertising, sponsorships, public relations, direct mail, list rental, literature, promotional products and so on.
- Show services 12.8%: Electrical, plumbing, janitorial, security, internet, telephone, carpet, equipment and furniture rental and so on.
- Exhibit Design 11.4%: The design and construction cost, refurbishing, display materials, graphics, and so on.
- Travel and Entertainment 10.9%: Staff airfare, lodging, meals, ground transportation, temp staff fees, training, staff attire, hospitality events, client and prospect entertainment and so on.
- Shipping/Transportation 8.9%: Freight, drayage, customs, brokerage and so on.
- Lead Management 2.7%: Lead retrieval system rental or purchase and lead follow up.
- Exhibit Staff Training 0.7%: Because your staff makes or breaks the success of your exhibit program, investing in staff training is a really important line item.
- Other 1%: Anything that doesn’t clearly fall under the above categories.
Controlling exhibiting costs is critical to a profitable exhibiting investment. Here are some tips to help you save money:
- Read the exhibitor service kit and pay careful attention to meet all deadlines.
- Order booth accessories and services in advance.
- Request that show labor be done on straight time, if possible.
- Have as much work as possible done on your exhibit before it is packed and shipped.
- To minimize I&D costs, number your crates according to content, attach a diagram and include detailed instructions on how to construct the exhibit, along with electrical requirements and repacking instructions.
- If you do several shows use the same fright carrier and negotiate volume discounts.
- Take advantage of show advertising packages, when available.
Take control of your exhibiting dollar now by downloading the FREE tools and following the recommendations presented and you will be on your way to a more productive and profitable exhibiting program.