Trade show organizers remain optimistic despite Omicron’s coup

“When the world stopped, you carried on.” The slogan will welcome tens of thousands of construction industry contractors, dealers and distributors who paid up to $ 600 each to attend the World of Concrete show this month in Las Vegas – unless the Omicron variant of the coronavirus does not require a last minute cancellation.

The number of corporate exhibitions that may themselves continue into the New Year is once again in doubt. Just as business leaders had finally started grabbing their conference cords again after months of restrictions, the rapidly spreading tension from Covid-19 sparked yet another round of postponements.

At ExCeL, a venue in east London, the Bett education technology fair, the ICE gaming industry event and the 100% Optical eyewear exhibition – all of which are supposed to be must-see events in their respective sectors at the beginning of this year – were pushed back.

In the meantime, some exhibitors have withdrawn from the still taking place. Amazon, Meta and Twitter are among several tech groups that have pulled out of in-person appearances at the Consumer Electronics Show (CES), though organizers are determined to continue the event, which is due to begin this week, also in Las Vegas.

After surviving previous coronavirus-induced restrictions and cancellations, seasoned executives at some of the world’s biggest trade shows are trying to position their businesses to profit once the pandemic finally subsides.

“In fact, we’ve planned, reprogrammed, negotiated, renegotiated every three months for almost two years,” said Stephen Carter, CEO of Informa, the world’s largest trade show organizer.

“It was very demanding for our teams, and it was very demanding for our relations with partners and site contractors. “

Despite this, he added: “Customers have remained very determined to participate – when they can. “

Carter is so confident in his outlook that he has identified the events as one of Informa’s priority areas for expansion, alongside college publishing.

This month, media firm FTSE 100 announced plans to divest a portfolio of niche data and advisory and publication assets valued at at least £ 1.7 billion, and to redeploy some of the funds in its event activity.

Investors remain cautious. Informa stock is nearly 40% lower than it was at the start of 2020, while Paris-listed GL Events is down 25% over the same period and New York-listed Emerald Holding is 62 %.

Nonetheless, before Omicron’s emergence, there were encouraging signs for the industry that weary Zoom delegates were eager to return.

Data from the Center for Exhibition Industry Research (CEIR) shows that cancellation rates among U.S. business-to-business exhibitions fell from 98% in the second half of 2020 to 19% in the third quarter of 2021.

Despite a slow start to the year and lingering concerns about the coronavirus, CEIR estimates that 15.3 million people witnessed such events in the United States in 2021 – more than double the previous year, although fewer half of the pre-pandemic levels.

“The snapback shows that the model is solid,” said Paul Thandi, managing director of NEC Group, owner of the UK’s National Exhibition Center in Birmingham. Yet, he added, since the release of Omicron, “exhibitors have become more risk averse.”

“They are reluctant to spend thousands of dollars on booths, personnel costs and other accessories,” he said.

The Frankfurt Book Fair. Trade shows have been forced to spend more on Covid-related measures such as disinfection and social distancing © Arne Dedert / AFP / Getty

Events scheduled to take place at the NEC in the New Year that have been rescheduled include Lamma, an agricultural machinery show popular with farmers.

Despite widespread cancellations, few major event planners have so far encountered serious financial difficulties, in part because their parent companies have interests in other industries that have not been hit so hard by the pandemic. .

One exception is Paris-based Comexposium, which has spent much of the last year in a “safeguard proceeding”, although it exited in October after shareholders injected € 110m into the bank. ‘business.

Some other organizers have appealed to shareholders for money at the start of the pandemic, helping them weather the storm. Informa raised £ 1 billion in a placement last year, which equates to around 20 percent of its equity.

Leave programs and other forms of government support have been a lifesaver. In cases where authorities have imposed restrictions preventing events from unfolding, insurance has also been crucial, despite sometimes limited coverage.

Around £ 65million in insurance payments helped Hyve, another London-listed event organizer, return to profit in the year ending late September.

The pressure on organizers’ cash flow was also less intense than it could have been otherwise, as exhibitors typically paid up front, said Dan Assor, an event consultant.

He added that in some ways, it was the contractors – often small companies that provide equipment, lighting fixtures to registrars, as well as logistical support – that have been hit hardest. .

“The supply chain has been decimated,” Assor said. “A lot of freelancers have disappeared.

As in other industries disrupted by the coronavirus, executives expect some changes to prove lasting.

Mark Shashoua, managing director of Hyve, said he expects a shake-up from small trade shows. Even before the pandemic, he said, there had been a “gravitational pull” towards the biggest event in any given industry – a trend the pandemic had only accelerated.

“If the event and the sector were booming before the Covid, it is recovering very quickly,” he said. “If it was a second or third level show, it doesn’t recover. “

Sarah Simon, analyst at Berenberg, anticipates consolidation in the fragmented sector. “In the short term, in some markets there will be continued disruption, which I think will further eliminate the weak,” she said. “There are a lot of mid-sized assets that could be interesting. “

Column chart of U.S. measures, rebased to 100 for 2019, showing how the pandemic has wreaked havoc on the exhibits industry

Analysts said potential sellers could include Daily Mail and General Trust, which in addition to owning the UK’s top-selling daily among other titles, also has events business.

Its portfolio includes ADIPEC, an energy industry exhibition organized by Abu Dhabi National Oil Company. DMGT was recently shut down by Lord Rothermere, who would focus on the company’s publishing assets.

Companies like Informa are also trying to make more use of the data generated by such events. They have long encouraged delegates to use specialized apps, but recent health and safety requirements have made online registration mandatory in some cases. Organizers try to sell attendees more related digital services, such as delegate matchmaking and post-event analysis.

Yet unlike conferences, or at least the on-stage discussions that underpin them, trade shows cannot be easily recreated online. It’s hard to smell the fabrics, like at the Pure London fashion show, or to gauge the prospects of emerging mobile technologies from a distance, like at MWC Barcelona.

“You can’t reproduce it face to face,” Assor said, adding that the shows had made trade easier since the Great London Exhibition of 1851.

Chris Skeith, managing director of the UK Association of Event Planners, said the pitch was kept simple. “The clue is in the name,” he said. “They generate trade.

“You take the pulse of everything that is going on in your industry – all of your competitors, customers, suppliers are in one place at once. It’s an incredibly efficient way to do business.

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