Life was simpler when I wrote my first article on trade shows in the mid-90s. We went to trade shows because it was the only place to see, and to make, complete product presentations, and discover new, meaningful, features and products. There were also a lot more specialty retailers. The shows were the only place they and brands could efficiently connect and do business- by which I mean write orders.
All that’s changed. It’s not that it doesn’t still go on, but it doesn’t have to happen at trade shows like it used to. There are other choices caused by consolidation, the internet, and changing consumer behavior.
Everybody I talk to say, “Yes! We need trade shows.” They also know the current model needs to evolve, but they aren’t sure how. Neither am I, but I’ve got some ideas about what might happen and why.
I’ve been thinking about this since before the SIA show, but have allocated more of my brain to it since I got back. Let’s start with the conundrum as it applies to SIA, then generalize.
It’s no secret that over the last year SIA, under Nick Sargent’s leadership, has rather dramatically reduced their staffing and general expenses. I think they needed to, and it gives them flexibility in managing the trade show dilemma. Still, a big chunk of their income is from various show related sources, not the least of which is selling space to exhibitors.
What does SIA, or any trade show operator, do if (or as?) fewer brands exhibit and those that do require less space while there are fewer retailers to attend? I think it likely that the larger brands, which tended to use the most space, will continue to be the ones to reduce their presence. They have evolved other times and places to reach retailers- especially the large ones that make up an increasing percentage of their business.
Now, let’s revisit for a moment the buy- sell cycle, the cause of so much blood, sweat and tears over so many years. The one thing we know is that no matter what dates (within reason) are picked for the show, half the people will like them and half won’t. It’s hardly a surprise that people selling winter sports products would prefer not to be distracted by shows between November and perhaps the middle of February.
But remember that show dates have traditionally been held hostage by product design and production cycles. Whenever a show is, and however involved in generating orders it may be, it must involve timing that allow for the product to be produced and delivered on time- a process of some months as things stand now.
But what that means is changing too. Brands are meeting with retailers (especially larger brands with larger retailers), showing product, and getting order independent of the shows. Brands and retailers (remember brands are retailer and retailers are brands now) meanwhile, are increasingly carrying product over from one year to the next. It makes perfect sense and I encourage it, given the business environment we find ourselves in.
Consumers are increasingly buying to use- not way in advance. The snowboards don’t have to be in the shop in August. November is just fine. To the extent deliveries can be later, perhaps show dates can change as well.
Consumer behavior, which ultimately dictates everything we do, is largely influenced by two factors. The first is general economic conditions, by which I mean that many of our customers don’t have as much disposable income as they once had. The second is that they have perfect information at their fingertips. If you aren’t cautious with your distribution- even to the point of losing some sales- you will have a tough time differentiating your product. It doesn’t help, of course, that from brand to brand our products are so similar and generally all function equally well.
If consumer behavior is causing you to follow the business model I’ve been pushing for something over eight years- a focus on margin, cautious distribution, and expense control to boost the bottom line even at the expense of some sales growth- then, bluntly, the traditional values of trade shows aren’t as important to you as they used to be. You are working as hard as you can to be cautious about inventory and are doing your very best to avoid having product you must write down at the end of the season.
We also learned at the excellent Intelligence Day at Denver that something like 75% of SIA member’s soft goods sales are to people who don’t participate in snow sliding. I think it was a little higher than that. I don’t quite know if that’s a problem or an opportunity. Probably both. NSAA (National Ski Areas Association) has a similar issue. Many of its members are focused on generating year around revenue. They are still ski areas, but not only ski areas. What do industry trade shows do to cater to an exhibiting membership with a customer focus that is changing?
Meanwhile, production cycles and customer preferences and expectation are getting harder to synchronize. What’s going to give? Production cycles. Not today or tomorrow, but over time automation and technology will continue to offer increasing flexibility and speed in production. I’m not sure what it will mean to be a brand in ten years. As consumer power allows them to demand the product they want when and where they want it with the features they require, what will be the point of this process of designing, showing, taking orders and delivering that stretches over so many months? Perhaps consumers will be designing their own brands and products.
Okay, my brain is exploding. I don’t know how this is going to work out, but I think we mostly agree that the trade show model must change.
It is changing. First, it’s generally acknowledged that we’ve got too many shows, but nobody seems to be volunteering to just close their show down. No surprise there. Second, in established shows we’re seeing what I’d characterize as tinkering around the edges. I’m sure the people running shows are surprised to hear me characterize it that way. But the scenario I’m seeing suggests that the traditional model of renting booth space and getting retailers to show up to see product lines is going to become, at best, less important.
We’re also seeing some new show models. Agenda did a consumer show. Parts and Labor was a new “core” snowboard show that overlapped with SIA in Denver. The Outpost was a small, experience focused show.
Perhaps I’ll stop using the term, “trade show.” Gatherings seems a better term. I don’t think I’ve talked to anybody who doesn’t agree that a reason to pull everybody from the industry together is for face time. Sometimes, when you’re making a deal, clearing up a problem, or trying to get to know somebody you might do business with, there’s no substitute for looking the other person in the eye- and not on a screen. You can learn an awful lot over dinner and couple of drinks.
It’s probable that a year from now I will have been to some trade shows that look a whole lot like the ones I just attended. But I don’t expect the pressures for change I’ve described to go away. Consumer behavior, the business model and cost structure I see more and more companies moving toward, automation and improved logistics, a lack of product differentiation and general economic conditions will make the current trade show model less useful.
In the short term, I imagine we’ll see some more new, smaller, concept trade shows. It will be interesting to see what sticks. I also imagine that efforts to maintain the traditional build booths, rent space, get people to come model will lead to consumer shows attached to trade shows. It’s the financial model that makes the most sense.
In the longer term, it’s not that there won’t be trade shows with brands showing product and retailers checking them out. But there are too many shows in too many places right now and they are all going to fight to make sure they are survivors. In the same way, we’re watching it with retailers, I expect consolidation among trade shows. I can imagine the model evolving towards conferences with opportunities for face time, education, and perhaps exhibits by, new small brands only. Perhaps large, broadly focused show will give away to events that are more niche focused.
I’m trying to end this article and failing badly. I guess where I want to leave you is with my best guess. The factors I’ve discussed suggest that trade shows (Gatherings? Conferences?) will be smaller, shorter, local, and niche focused. Ultimately, they will mimic the consumer tendency for communities to form and dissolve rapidly. Remember that the consumer has never had as much power as they have now, and I expect that to grow.
Okay, now I’m done.