By Denzil Rankine, Executive Chairman, AMR International
Imagine this: In the future, exhibitions will function as digital ecosystems. Stakeholders—organizers, exhibitors, attendees, vendors and venues—will simply plug into them. Participation will be frictionless; the customer journey will be easily discernible and value will be effortlessly measured and exchanged.
Fanciful? Perhaps. But to get organizers from where they are today, in a wait and see holding pattern, to where they can craft tailored digital experiences that drive stronger revenue streams, requires a robust strategy.
A practical first step is to monetize existing data and technology, while taking steps toward funding a long-term digital transformation.
Why worry about digitization now?
Digital transformation is becoming more urgent. Today, 80% of exhibition revenue comes from exhibit space sales. Organizers derive the balance from sponsorships, attendee revenue and digital product sales. Growth will continue but in 10 years that ratio will have changed. Exhibitions might only yield 60% of their revenue from exhibit space sales because volume and pricing growth will be restrained by ongoing challenges such as the struggle to engage attendees, increased competition from other marketing channels and the inability to deliver the metrics exhibitors require. Revenue growth is likely to come from value enabled by data and digital as well as new revenues from new services that they bring to the table.
Success stories are abundant outside the exhibition industry
Other industries are profiting handsomely from digitization. Retail giant Tesco’s subsidiary dunnhumby, a billion-dollar digital data business, helps Kroger and other retailers and brands uncover and apply customer insight. The data is used to create more personalized retail experiences, discover new product categories, grow existing categories and brands and drive new revenues—all parallel goals of almost every exhibition organizer. More broadly, firms in technology, communications, media, professional services, finance and insurance see “outsized growth in productivity and profit margins” as the result of being ahead of the digital curve.
Exhibition organisers are in a holding pattern
Despite the demonstrated success elsewhere, tradeshow organisers are reluctant to embrace large-scale digital transformation. Very few have allocated budgets for the research and development of digitisation. Most have made little effort to monetise even the low-hanging fruit of digital, such as selling attendee insights and behavioral data back to exhibitors. Many do not give digital solutions time to mature before cutting the purse strings. Across the board organisers have communicated their uncertainty about how to proceed, fear of implementation failure, and satisfaction with waiting for others to make the first move.
Leveraging the data and assets available today
The monetisation—sooner rather than later—of data and digital investments is a chief interest for the industry. But without a digital infrastructure to leverage, the ways to accomplish that goal are limited. Most organisers currently have two options: selling digital products and services produced internally and by third-party solution providers, or using digital technologies to enhance existing events to support pricing strategies and drive revenue growth.
Organisers wanting to move forward with limited risk can employ a gain-as-you-go strategy. This means funding digital transformation by monetising existing technology and creating highly productive and desirable experiences for which customers will pay a premium.
Reselling existing data and technology
Selling digital products (e.g. data on attendees and their needs) and services that organisers have developed internally (e.g. matchmaking) is one path to revenue. But with a hundred or more companies offering various point solutions to the exhibition industry, organisers have plenty of options to choose from.
There are also advertising and sponsorship opportunities; these can be associated with offerings such as mobile applications, event management software , device charging stations, interactive show floorplans, Internet access pages, digital wayfinding, gift walls, games and beacons.
Diligence around selecting the appropriate technologies, implementing them correctly, and dedicating staff to the process is required. Even more importantly, focusing on providing event participants with useful value, based on deep understanding of their addressed market, is paramount.
Transforming events into revenue-producing machines
Using data and digital technologies to map the customer journey, derive behavioral insights and provide streamlined and efficient participation experiences that drive revenue is a far more complex challenge for organisers. It requires collaborating with vendors and venues, integrating best-of-breed technologies through application programming interfaces (APIs), analyzing the mountain of data that tradeshows produce, and managing the process at an organisational level (rather than at an event level). A playbook for migrating manual processes and practices to digital platforms as part of a comprehensive strategy will make transformation easier.
Avoiding death by a thousand cuts
Trade show organisers understand that disruption of the exhibition business model can come from any number of directions. And rather than coming in the form of one giant glancing blow, it’s likely to be “death by a thousand cuts” according to AMR’s Data and Digital Strategy Events Symposium keynote speaker Marco Giberti.
Organizers can protect themselves by using digital capabilities to enhance event outcomes for participants. This should also enable organisers to monetize the data and technology available today. At the same time they can lay the groundwork for new revenue categories, more loyal audiences and new audiences (e.g. virtual attendees) as well as extending the windows of opportunity, both before and after the live event.
Read more about this hot topic with insights from AMR’s Data and Digital Strategy Events Symposium – ‘Embracing data and digital is critical for transforming the events industry’.
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