Our last post concluded with two truths: 1) Tradeshows are worth it because they provide the opportunity for face-to-face interactions—the thing we as sales professionals and businessmen and women are all looking for at the end of the day. And 2) to get worthwhile face-to-face interaction you need to put a lot of money, time, and resources down upfront. We also concluded with a challenging practical question: How can I measure tradeshow ROI? Part two discusses the complicated question of tradeshow ROI, as well as the perceived and concrete value in face-to-face interaction at tradeshows.
– Part 2 – The Woes of Tradeshow ROI and the Glory of Face to Face Business
Can you really measure Tradeshow ROI?
It’s a cruel but necessary task.
Once you’ve determined you have the budget to compete, and once you decide what your primary goals for the event are, you can then attempt to estimate what the ROI of your tradeshow investment will be. It is certainly easiest to determine your ROI after the event takes place. New contacts are made, deals are made, contracts are signed, and follow up is taken care of. At this point, a few months after the event, it is a simple math equation: at the bottom line, did we make from this event more than we put into it? Be sure to take into account not just event costs, but time as well. Many behind the scenes man-hours go into the preparation for an event. But, if the answer is yes, (and that was your primary goal, to make more than you put in) then great! You had a successful show. But, while the economy is improving, it is looking and behaving differently than before, and many companies simply cannot afford the risk of such an investment with an unknown return. Now enters the task of anticipating Tradeshow ROI.
Anticipating ROI is even more difficult. It requires complex calculations that are much more complex than adding up receipts and cut checks. First, one must estimate the total number of man hours for prep as well as any hard costs, such as registration fees, shipping, travel, booth purchase, design, and setup, etc. The harder part is anticipating an expected number of leads per hour per person, the number of staff attendants per booth, their previous event experience and performance history, an estimation of the quality of the buying attendees and their collective buying power, etc. That is a tall order. The estimated variance alone could put you deep in the red, or blow the record off your most successful event ever. Again, this is sometimes a risk that is no longer acceptable in our current Lawn and Garden industry.
The more an event can guarantee you a specific number of qualified leads, the easier it will be to anticipate your ROI. But as discussed earlier, with nearly all events, the only way to guarantee more leads is typically from investing in prime event real estate and prime event attractions—both of which drastically increase your upfront investment. For detailed information on how to calculate ROI on a trade event, read Measuring Results by Creative Training Solutions, or How to Track Your Tradeshow ROI by MarketingProfs.com. While not industry specific, both outline many of the variables and considerations in ROI measurement.
The Value of Face-to-Face
Marketers and salespeople agree that face-to-face is key to closing more deals.
Regardless of what your marketing priorities are, you go to tradeshows because they are one of the few marketing channels that provide you face-to-face opportunities with the people you want to do business with. This is the primary differentiator of a tradeshow. Emails, digital and print advertising, media buys, etc.—these can all help you accomplish almost any marketing objective—but they cannot accomplish them in the way real, human, face-to-face interaction can. Whether your aim is to meet new clients, nurture existing clients, negotiate contracts, or identify growth opportunities, this form of interaction continues to be the most effective way to achieve your goals. Interested in this topic, the Harvard Business Review’s Analytic Services surveyed 2,300 HBR subscribers around the globe. Their survey results are a testament to the global value of face-to-face:
79% said that in-person meetings are the most effective way to meet new clients to sell business, and 89% agreed that face-to-face meetings are essential for “sealing the deal.”
Virtually all survey participants (95%) said that face-to-face meetings are a key factor in successfully building and maintaining long-term relationships, reflecting what many executives call the “high impact” of in-person communication.
“Emails and phones cannot deliver the level of confidence and understanding that in-person meetings bring to the table.… Face-to-face communication contact is the broadest bandwidth communication you can have in professional life.”
These are big numbers! It’s not just a subgroup of business people who appreciate and value face-to-face, but the overwhelming majority. There is clearly more to “face-to-face” than just being a gimmicky buzzword. But how can you tell if you are getting valuable face-to-face time? How does an event structure this time? Do you have your colleague’s full attention, or are they just hearing your sales pitch for the free sample you give them at the end? Is there any way to guarantee the vendor has a product you are actually interested in, or was their booth misleading, and now you are stuck wasting both of your time? The truth is, “face-to-face” comes in all shapes and sizes. It is a diverse concept, and like all things, if not organized to fit your needs can, end up being a detrimental waste of time.
Part 2 concludes with the uneasy truth that anticipating ROI is a complicated task, and the undeniable assertion that there really is something to face-to-face business. But, also, face-to-face can mean many different things to many different people, and to really anticipate your ROI, one must have a good handle on how any face-to-face interaction is going to play out at the event.
This is where part 3 picks up, and the conclusion of our series Who Cares if it’s Face to Face? We will look at the different ways businesses pursue face-to-face interaction, and the pros and cons of each, and conclude with how we think face-to-face works best for our industry.