Of all the post-pandemic components of a successful media business, events might be the most fast-changing. Consider that live conferences and trade shows literally shut down in the second quarter of 2020, and didn’t really get back on track until a year and a half later, in 2022.
Companies and associations with events-centric businesses—and for some, events was 70% or more of their business—experienced catastrophic nosedives in revenue. Most pivoted to virtual events, but even on sophisticated software platforms they didn’t come close to the vitality of an in-person event.
Nor did virtual events replace lost revenue dollar-for-dollar. Generally they were far less on the top line, and sometimes better than the already strong bottom line in the events business.
Still, proponents of virtual events postulated that virtual event platforms were the future, the existential threat to live events, to ultimate disruption of an industry.
That didn’t pan out.
Buyers and sellers alike flooded back to in-person events, and anecdotal evidence suggests that many companies exceeded their budgets last year. But going forward, the events industry is likely to change more, as producers seek to stay connected to conference attendees year round. Indeed, the world’s largest trade show company, Informa, made headlines two weeks ago with its acquisition of Tarsus Group in a deal valued at $940 million.
Informa paid a very rich EBITDA multiple of 9.9 times, but the company said that number will come down as operating efficiencies are factored in. And one of the driving factors was acquisition of Tarsus Group’s first-party data, with an estimated new audience of 1.4 million across the Tarsus assets.
With this as the context, Fox Tales met with Jeff Naccarato, senior account manager at Hall-Erickson, Inc. the full-service outsourced event management firm based in Westmont, Illinois.
Jeff Naccarato.
The company produces conferences and shows, secures venues, sets budgets, handles sponsor and exhibit sales and much more. It’s a 70-year-old business with roots dating back to 1930, so it has a whole lot of institutional knowledge through which to view the current events climate.
Here’s our Q&A with Naccarato, edited for clarity and brevity.
Fox Tales: Give us your educated and experienced point of view regarding the pre-, mid-, and post pandemic effects on the trade show industry.
Jeff Naccarato: There are some things we saw over the past three years that were universal to trade shows across the board. But we should remember that trade events even in the best of times are not “one size fits all.” It’s largely a reflection of its industry and the many different events we serve, in varied industries, are all recovering at different rates.
That said, I would sum up shows in the COVID era in the most-simple terms: If your 2019 pre-pandemic show was a 10, and your 2021 edition (if you even had one) was a one, we saw a lot of sevens and eights in 2022. Early returns in 2023 indicate we will see many eights and nines. We will even see some shows that meet or surpass their pre-pandemic levels.
Fox Tales: What does your firm’s 70-year history (with roots dating back to 1930) tell you about the future of events? There must be amazing institutional memory and learnings there.
Naccarato: I have been happily working in the management of trade events since 1995. Like all industries, there have been many ups and downs in that period, but the bulk of that time has been marked by trade events largely growing. There is still a place for face-to-face marketing that doesn’t appear to be going away—and there have been serious challenges in that time. I remember the environment of fear in travel that marked the immediate post-9/11 era and the recessions that followed. And even very early in my career, there were serious challenges to in-person marketing created by the then-new technology called the internet. In the late nineties I’d sometimes be confronted by highly confident folks a bit younger than me (and I was still south of my thirtieth birthday!) who told me the industry I worked in was a dinosaur.
Why go through the trouble and expense of traveling to a live event, they’d reason, to exhibit your offerings when a potential buyer could just visit your website and see images and get information to make a purchase decision from the comfort of their own office? We would all soon see the folly in that argument.
Internet technology has worked very nicely hand-in hand with live events. There have been other challenges too—would younger generations who have been raised on Amazon and are quite used to getting what they want at the literal press of a button, carry-on the practice of doing business and networking in a face-to-face environment? Every bit of research on the topic has indicated that, yes, they will. Still, the most serious challenge to live events in my time has easily been the COVID pandemic. There was complete upheaval of not just events, but every aspect of our lives. I remember fearing that the psychology of pandemic would outlive the actual danger from it. Yet, here we are with a portfolio of nearly twenty live events, all marching towards besting their pandemic-era editions.
Fox Tales: What are you hearing from your impressive client list about last year’s return from COVID?
Naccarato: I think the events held in 2022 have been confidence-building. The suppliers who decided to wait out 2022 shows and hold off on returning as exhibitors did not ultimately feel justified in doing so. In many cases they visited events and gained a lot of confidence to return as exhibitors. I know this because I have had many, many conversations with suppliers who have decided to get back out there in the last several months. The return of shows has been a process. It’s one that’s not complete yet, though.
Fox Tales: From a financial perspective, what are you hearing about the next 12 months and beyond.
Naccarato: While it has been great to see the environment of fear retreat rapidly and confidence in live events growing, there are a few other potential icebergs. Wars, rumors of wars, and wild inflation are still feeding an environment of caution. While we are seeing suppliers returning to events as exhibitors, groups are waiting longer to do so, and we have not seen a mass return to exhibitors reserving their pre-COVID space size averages. Show organizers are largely optimistic, but estimates are conservative.
Fox Tales: Where do virtual events fit for your clients?
Naccarato: Experiences with virtual were one of those things most show organizers seemed to agree on. I think there is a very important place for virtual activities. I think we saw virtual do an admirable job of providing conference and educational content when attendees were not traveling. But I think virtual expos, those activities that attempted to replicate what happens in an exhibit hall, were not as successful. Virtual platform providers kind of saved the day in 2020 when live wasn’t going to happen. And we were able to enjoy some kind of engagement. Still, even when virtual expos were the only game in town in 2020, they were largely not successful.
I had a lot of conversations and remember many ‘no more virtual’ corporate edicts from companies that tried them. The most relatively successful virtual expo I was worked on had 105 virtual exhibitors. If we had attempted another and sought renewals, we would have seen a renewal rate of 20% or less. Like any relatively new offering, there were things to learn and things to improve. Virtual expos could still be valuable, especially if something else comes along and shuts down society.
Fox Tales: One more: What new trends have emerged in marketing?
Naccarato: The suppliers who most successfully survived the pandemic were those who best reinvented themselves. We saw many exhibition-industry suppliers, for example, that were venerable producers of exhibit and experiential-marketing environments for decades prior to pandemic. And they successfully pivoted to making dividers for office or retail spaces. Some even prominently produced barriers for protest-weary cities in 2020.
Perhaps suppliers are going to be more nimble and adept at identifying new markets to serve and how they can reinvent themselves—if need be.
In other marketing trends, we hear a lot today of the most successful suppliers being those that are moving away from being transactional and moving towards being trusted advisors as opposed to mere providers. Perhaps along those lines, exhibitors at shows today are expressing interest in being seen as thought leaders. There is a wealth of knowledge among exhibitors on the show floor of any trade event.