Recently an exhibitor told me that he would be happy with his show investment if he recouped his expenses.
Why would anyone undertake an activity that cost time and money with the hope of breaking even?
Exhibitors are often short sighted. They measure results on what they walked away with rather than the potential that may develop from their show activities.
In some cases the difficulty in measuring results is due to a lack of clearly stated objectives. Show objectives give your exhibit purpose. It has been reported that nearly 70% of all exhibitors do not state clear, purposeful objectives.
Another problem is that shows are often viewed as business anomalies. For many marketers, when it comes to shows, all great business principles go out the window.
To calculate your ROSI - the return on your show investment you need the answers these three questions:
1. How do you establish your ROSI?
2. How do you track information?
3. How do you calculate your ROSI?
Establishing your ROSI
Every exhibitor is different, so choosing the right approach means stepping back and seeing the big picture. How does a show fit into your overall marketing plan?. Marketing options are chosen with the company’s mandate, the product life cycle, budget and availability in mind. Exhibiting should stand out in the marketing mix as something special.
Weigh shows against all the marketing events your company uses and you will find that shows shorten your sales cycle and therefore deserve an important place in your overall marketing mix. How much, depends on how you plan to measure your ROSI.
Here are three common methods:
1. Percentage increase in booth activity from previous show.
One method many experienced exhibitors use to measure ROSI is the actual increase over the previous year’s results. This could be direct sales, qualified leads, attendance at in-booth activities, or customer inquiries. For example, if your last show cost $10,000 and you obtained 100 quality leads, then your cost per lead is $10.00. If you spent that same $10,000 at the next show, you could reasonably expect to receive similar results. However, you should be looking at some improvement. Will each new lead cost an additional $10.00 to get? Probably not, since you can take advantage of economies of scale. You might say that next year you want to get 200 leads and will invest $15,000. You will accomplish this by better booth hardware, increased promotion, new products and so forth. Your average lead cost has now dropped to $7.50.
2. The number of existing or new prospects who actually stop by the booth.
Booth traffic may be a reasonable way to measure your ROSI, but not any traffic. It’s no feat creating a booth that attracts every visitor that passes by. The real talent is creating a booth that attracts the people you identified as your target. It is a rare exhibitor who wants to talk to everyone. Your booth people can then track the visitors as a measure of ROSI.
3. Direct value on show investment.
The real profit from an exhibit can be defined as value. Value can be looked at in both the short and long-term.
In the short term the best you can hope for is based on the actual counts you made at the show - the number of leads, inquiries or sales. Here you calculate your ROSI as a cost per lead or inquiry.
There is more to a show than immediate results. Much will happen in the weeks, months and years following your show appearance.
Calculating long-term value starts with the premise that no matter how seriously you were taken on the show floor, the chance of getting 100% of the people you meet to actually commit to your products and services is slim. Your closing rate is the number of leads to the number of actual sales or contracts received. Therefore if you gathered 100 qualified leads and you are likely to develop three customers out of every 10 leads and if the average opening order is $1,000, your show investment of $10,000 will give a ROSI of $ 30,000 (30 new customers with an average opening order of $1,000).
ROSI information can be gathered at the show as well as after. The method you choose will be the one that best suits your objectives.
Sales figures, lead information or customer inquiries are easily tracked on the show floor. Where your objectives involve such things as image or awareness, you will need to take some post show action such as show survey. A random sample will suffice. Reach these people within two weeks of the show and ask them questions that relate to your exhibiting objectives.
Calculating your ROSI
When calculating your ROSI, ensure that the following four steps are included.
1. Complete the show budget. Your budget was based on estimates from past show experiences or by talking to your suppliers. Now complete the budget with the actual costs of exhibiting.
2. Add up your results and compare. By looking at your short term results (number of leads, responses to the telemarketing surveys, etc., and comparing these to your actual costs, you are armed with some good information to begin to evaluate the value of the show and your future plans.
3. Conduct a post-show debriefing.
To get the biggest bang for your buck invite all those who helped you with the show including staff, suppliers, show management etc, to the briefing.
Gather anecdotal and empirical feedback. Don’t get defensive, just listen and record everything.
4. Take all the information gathered from steps 1,2 & 3 to decide your future exhibiting direction.
Creating the right method of determining your ROSI is worth the effort. The number of show options has increased and the cost of exhibiting is skyrocketing. You need to make the right choices the first time. Knowing what works and what doesn’t is crucial.
ROSI is not magic. It just boils down to good business practices.
About the Author:
Barry Siskind, President and Founder of Internationals Training and Management Company. Barry is a consultant, speaker and internationally recognized expert in trade and consumer shows. Barry is an active member of the Canadian Association of Exposition Management (CAEM), the Centre for Exhibition Industry Research (CEIR), the Trade Show Exhibitors Association (TSEA) and International Association of Exhibitions and Events (IAEE).