HIGHLIGHTS OF KEY INDUSTRY TRENDS BASED ON CEIR RESEARCH PREPARED ESPECIALLY FOR ECEF 2016
MACRO LEVEL INSIGHTS SIZE OF THE U.S. EXHIBITION INDUSTRY - THOUSANDS OF EVENTS SERVING MILLIONS According to the 2015 CEIR Census, a total of 11,427 exhibitions took place in the United States in 2014. Most events, 82 percent, are B2B exhibitions and 18% are B2C exhibitions. Other key U.S. exhibition industry market size metrics: Total NSF (000s): 461.1 million Attendance (000s): 81.4 million Exhibiting Companies (000s): 1.7 million The 2015 CEIR Census tallies number of exhibitions, including both B2B and B2C exhibitions with at least 3,000 NSF of paid space that take place in the United States, Canada and Mexico. This data is broken out in a variety of ways – by country, state or province, top ranked cities, venue, time of year, exhibition size, CEIR industry sectors.
U.S. ECONOMIC AND EX HIBITION INDUSTRY OUTLOOK FROM 2016 CEIR INDEX – CAUTIOUSLY POSITIVE U.S. Economy Despite widespread pessimism and deceleration of activity during the fourth quarter, the U.S. economy still displayed significant signs of strength in 2015, led by personal consumption and residential construction. These strengths were offset partially by deterioration in energy development and net exports to produce real GDP growth of 2.4%. According to CEIR’s current projection, 2016 growth will be about the same, or perhaps slightly weaker at 2.3% as the trade gap widens further, before GDP accelerates to 2.8% by 2018. GDP growth in the next few years will be sustained by the consumer and private business sectors, as government expenditures will make only small contributions to growth in the foreseeable future. Growth ultimately will be helped by stabilization in energy investment and net exports. In the 12 months ending in February 2016, nonfarm payroll employment expanded by an average of 223,000 jobs per month, reducing the unemployment rate to 4.9%. With fourth-quarter hiring averaging 279,000 per month and February 2016 adding another 242,000 jobs, employment and economic growth have momentum early in 2016. This steady hiring provides no indication of a looming recession. The best news in 2015 was real disposable income growth of about 3.4%, spurred by employment gains, a modest rise in wage rates, and low consumption price inflation. Wage and employment growth helped to boost real consumption spending by 3.1% in 2015, well above the 1.7% growth of 2013 and 2.7% in 2014. Consumption spending growth will remain robust at about 2.8% each year through 2018.
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Residential investment activity decelerated to 1.8% in 2014 before strengthening again to 8.7% in 2015. Housing should lead again in the next three years with annual growth near 7.0%. Sustained employment and income growth, better creditworthiness, and low but slowly rising mortgage rates will support recovery. Real spending for nonresidential structures fell by 1.6% in 2015. Weakness was concentrated primarily in oil field development while investment growth continued for many other types of structures. As oil field activity stabilizes, overall growth will revive to around 2.5% for 2016, above 5.0% in 2017, and above 6.0% in 2018. Macro Economy and Overall Exhibition Industry Oil prices plummeted from about $100 per barrel early in 2014 to $28 in February 2016, caused by high production volumes and weak petroleum demand in Asia and Europe. Although low prices reduced energy industry jobs and investment, consumers in general now can divert funds from their energy budgets to purchase other goods and services. Growth was helped by stabilizing government spending. Inflation-adjusted government consumption and investment expenditures (including goods and services but not entitlements) rose for the first time since a slight increase in 2010. The increase of overall real government spending was 0.7%, which followed a 0.6% drop in 2014. Real spending will increase through 2018, but growth will be slow. The biggest disappointment of 2015 was a sudden drop in net exports at the end of 2014 and beginning of 2015 as economic weakness continued for major U.S. trading partners in Asia and Europe. The associated strengthening of the U.S. dollar left domestic producers at a disadvantage, and so real exports grew by a slight 1.1% in 2015. Healthy income growth, a strong U.S. dollar and low import inflation supported a 4.9% surge of imports. Net exports will remain as a drag to the economy through 2018. The three-year outlook is moderately optimistic, but there are important downside risks. Many economists believe the odds of a recession in 2016 to be roughly 20%. Expectations for global growth have been falling and, combined with continued drag of falling energy investment and production, could bring stock market losses and undermine consumer and business confidence. This could lead to a brief recession in the second half of the year. Despite some encouraging signs, including action on infrastructure budgets, little will be accomplished on tax reform, discretionary spending levels and allocations, and entitlement reductions until after the elections. Uncertainty over the presidential and other elections only adds to the uncertainty brought by the lack of substantial congressional action, and both hamper business and consumer planning and spending. Surprises still could come on the upside. The tightening labor market may sustain substantial real wage increases that can support household spending growth and boost government revenues. Better government finances will encourage badly needed investment in infrastructure, education and other projects. Stabilizing energy markets will support renewed interest in domestic energy development, and ample cash reserves could sustain higher corporate investment in equipment and other assets. In line with expectations presented at the 2015 CEIR Predict Conference, the Total index increased by a robust 3.7% for 2015, 1.8 percentage points higher than in 2014. All four metrics rose in 2015, with real revenues leading at 6.2% above 2014. Attendees trended upward since the end of the Great Recession, and at 33.4 million in 2015, attendees finally exceeded its 2007 peak of 32.4 million; the other three metrics remain below their previous peaks. The strengthening job market helped attendees, and since it is a leading indicator of the exhibition industry, this bodes well for business in coming years. Exhibition developments in 2015 varied widely by industry. Leading sectors were Industrial/Heavy Machinery and Finished Business Inputs (ID) and Building, Construction, Home and Repair (HM) sectors, which gained 12.9% and 10.1%, respectively. Both benefited from rebounds in home construction and auto sales. The Government (GV) sector lagged with a decline of 1.3%. Government entities at all levels and functions continued to face tight budgets, particularly for training, education and travel. Economic and job growth should continue to drive expansion in the exhibition industry. However, the ID and HM sectors will grow more in line with the overall economy. As a result of their deceleration, the overall CEIR index will slow to 2.4%, 1.3 percentage points lower than the 2015 rate but still a 0.1 percentage point higher than real GDP. Growth will accelerate to 2.7% in 2017 and 3.0% in 2018 as the economy strengthens.
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After substantial declines during the Great Recession, real revenues have been the strongest metric since 2012. The real revenues CEIR index registered 106.2 (2014=100) in 2015, still about 8% below the peak of 115.3 in 2007. A relatively strong recovery should continue through 2018, in part reflecting a higher average rental rate. The outlook for Education (ED) and GV exhibitions remains somewhat pessimistic. Government employment is likely to remain stagnant over the coming years, limiting potential attendance for shows catering to government services. Still, strong offerings in new technology for government functions such as safety, logistics and education will continue to protect this sector from sharp declines.
MICRO LEVEL INSIGHTS CEIR’s mission, in addition to tracking market level performance, monitors metrics and trends at the micro-level, assessing needs and preferences of brand marketers that exhibit and professionals who attendee exhibitions to meet their business needs. Provided on the following pages are key highlights from CEIR’s most recent trend research.
HOW EXHIBITORS EVALUATE OUTCOME OF EXHIBITING – EXHIBITIONS DELIVER WHERE IT COUNTS Most exhibitors, 93%, have a process in place to evaluate the outcome of exhibiting, though this process is more likely to be informal, 52% percent; while 30% percent say they use both formal and informal processes. The infographic below summarizes which metrics are used and for which exhibitions perform best. These results reveal exhibitions deliver relative to the most popular metrics used.
Metrics Used to Evaluate Outcome of Exhibiting
Most Popular ROI Metrics Used ROI Metrics used by 62% of Exhibitors
Sales revenue to cost of exhibiting, 45% Sales revenue potential to cost of exhibiting, 43%
Most Popular Intermediate Metrics Used # of leads in general, 68%
Intermediate Performance Metrics used by 86% of Exhibitors
# of qualified leads, 62% Quality of leads, 60% # of meetings w/ prospects, 57%
Where Users Say Exhibitions Perform Best Sales revenue/ potential to cost of exhibiting, 59%
Where Users Say Exhibitions Perform Best Lead performance metrics, 60% # of meetings, 46%
# of meetings with customers, 55%
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DIGITAL TOOLKIT SERIES – INSIGHTS FOR ORGANIZERS TO MEET ATTENDEE NEEDS Provided below are key findings from this study series which documents attendee digital needs and preferences throughout their journey as an attendee. These preferences are compared to exhibition offerings, to assess where needs are met and where gaps are found. The summary below highlights attendee needs to organizer offerings. An additional report documents attendee needs to exhibitor offerings. A digital multichannel mix is a must to help prospective attendees decide whether to attend an event. Results indicate an exhibition organizer’s information sources carry the most weight; the event’s website is its flagship marketing vehicle, identified as an important resource by 70 percent of attendees. Organizers could do a better job in collaborating with their exhibitors, as any information from them helps persuade an attendee to come: 69 percent of attendees rely on exhibitor website content on exhibition participation and 65 percent rely on emails from exhibitors when making a decision to attend. Results indicate the exhibition website is an important resource used for pre-planning. A majority of attendees rate 17 of the 18 listed pre-show planning tools as important to have access to on the exhibition website. Gamify pre-event planning! Attendees and organizers do not agree on the impact of ‘gamifying’ pre-event planning. Most attendees, 75%, say they would be more likely to use pre-event planning tools if a points system was offered that was redeemable for attendee perks at the event. The majority of organizers are not convinced it would boost pre-event planning activity, as only 37% anticipate it would result in higher usage of these tools. An opportunity exists to shift services to self-serve options. When comparing attendee preferences to digital options organizers offer for badge and event ticket pick-up, gaps are uncovered that offer opportunities. The biggest opportunity is an affinity for selfserve options. The mobile device revolution is here NOW, on today’s exhibition floors. Most attendees, 96 percent, come armed with at least one mobile device. Nearly three-quarters of attendees come with a smartphone in hand, while over one third bring a laptop or tablet. Exhibition mobile apps have attendee users, though on average, still not the majority. Organizers say on average, 42 percent of attendees download an app they offer. This result compares very closely to the percentage of attendees that say they typically download a mobile app offered by an organizer, 44 percent. Nearly one out of four attendees, or 23 percent, choose not to download an app. Results suggest such attendees will be hard to convince to do so; reasons speak to disinterest in downloading apps for this purpose, and preference for other methods to plan and stay on schedule at an event. One size does not fit all when it comes to how attendees plan and stay on schedule. None of the digital information sources offered by organizers is relied upon by a majority of attendees. The most popular are the event’s website, 35 percent; event’s mobile app, 25 percent; and searchable electronic directories or kiosks, 24 percent. Four out of 10 attendees use their own calendar tools or documents. Are organizers missing the chance to deliver more engaging, personalized experiences to attendees? When it comes to the use of attendee tracking technology, the majority of attendees (very comfortable 21 percent and 29 percent comfortable), are comfortable with its use, and 31 percent are neutral, harboring no strong feelings either way. However fewer organizers are using this technology today. This study indicates that adoption of this technology is low among organizers. Nearly half, 47 percent, of exhibition organizers do not use attendee tracking technology. The largest percentage, 15 percent, use the technology for 10 percent or fewer of the events they run or manage. Exhibition organizer post-event communication methods are aligned well with attendee preferences and scored well as effective methods for attendee engagement. Two of the most popular methods include email communications, access to information on an exhibition’s website among other communication tactics.
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Keep a watch for reports scheduled for publication this year and updates on other research slated for 2016. If you receive an invitation to participate in a study, please say, ‘Yes!’ Your participation helps assure CEIR results represent a cross-section of the industry.
Research Study/Report
Attendee Retention Study Series IN PROGRESS
Description When it comes to gauging the success of an exhibition, the first measure is the event's ability to attract a quality audience. This success begets exhibitor retention and loyalty. This study will identify the key factors which prompt professionals to become a repeat/loyal attendee as well as organizer best practices that generate high attendee retention rates. Five reports are slated for publication in Q2 and Q3: Part One: Basics on Creating Your Attendee Retention Strategy Part Two: Exhibition Floor Features that Build Loyal Alumni Part Three: Education Content that Builds Loyal Alumni Part Four: Special Activities and Amenities that Build Loyal Alumni Part Five: 11 Real-world Case Studies on Business-to-business Exhibition Organizer Attendee Retention Approaches Last done in 2011, this popular study generated 10 fact sheets articulating the power of exhibitions from the perspective of
Repeat of Changing Environment of exhibitors. This initiative will update data, profiling the areas where exhibitions deliver value in supporting exhibitor marketing Exhibitions Study and sales objectives. It will also quantify commitment to the exhibition channel in the next several years. Reports will begin to IN PROGRESS roll out in Q3.
Cost to Attract Attendees Study
Floor Interaction/Attendee Engagement Preferences Study
How to Grow Attendance - Best Practices
Industry Insight Series Reports
Last done in 2012, this study provides organizers with metrics on the cost to attract qualified attendees. In addition to quantifying costs metrics, overall as well as by type of organizer and by event demographics, this study also identifies which tactics are most effective in drawing qualified attendees.
Following a two-phased research approach involving qualitative and quantitative research efforts, this study will identify the most popular and effective methods used to interact and engage with attendees on the exhibition floor, from both the perspective of activities in exhibit booths and activities in organizer-sponsored spaces on the exhibition floor.
Organizers are constantly striving to find ways to retain and grow their attendee bases in competitive markets. Which tactics are most commonly used in attendee marketing to maximize the outcome of a campaign and most importantly, which tactics work best? This study will document industry benchmarks on key elements of attendee marketing campaigns and identify which tactics are effective in retaining and growing an event’s attendee base.
Keep a watch for additional reports from leading industry experts that will publish this year. Greg Topalian has authored an article for organizers on the topic of driving innovation in a mature industry. Dana Tilghman, CTSM, CMP, Senior Trade Show & Events Planner at Minitab Inc., a leading software firm serving multiple industries will share her company's story of building a speaker program that has helped fuel lead generation to their exhibit booth.
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For direct access to cited CEIR reports, go to: 2015 CEIR Census Report http://www.ceir.org/reports/exhibition-census/index 2016 CEIR Index Report http://www.ceir.org/exhibition-index 2015 Exhibitor ROI and Performance Metrics Practices https://www.ceir.org/products/2624 2016 Digital Toolkit to Enhance the Attendee Experience – Attendee Technology Profile https://www.ceir.org/products/2652 2016 Digital Toolkit to Enhance the Attendee Experience Focus Report on Exhibition Organizer Onsite and Post-event Offerings https://www.ceir.org/products/2653 2016 Digital Toolkit to Enhance the Attendee Experience Focus Report on Exhibition Organizer Onsite and Post-event Offerings https://www.ceir.org/products/2653 OTHER REPORTS PUBLISHED OFFERING INSIGHTS TO SUPPORT EXHIBITOR SUCCESS: 2016 Digital Toolkit to Enhance the Attendee Experience – Exhibitor Offerings https://www.ceir.org/products/2651 Industry Insight Series Reports including: Managing for Results: Benchmarks for Exhibit Growth https://www.ceir.org/products/1315# Best Practices for Exhibit Booth Design – for Companies of All Sizes https://www.ceir.org/products/2639 99 Cost-Savings Tips and Tricks for Exhibit Managers https://www.ceir.org/products/2673
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