Trade Show ROI: Fact or Fiction? Objective or Subjective? Measurable or Intuitive?
Recently I was talking to a senior marketing executive for a major trade show organizer and I asked if they were getting besieged by exhibitors demanding a better return on their trade show investment. Were people asking them to help improve their trade show ROI? I expected him to say, “Oh yeah, this is the number one issue we’re facing – other than rising show costs.” Instead he said, “No not at all. You can’t measure trade show ROI. It’s impossible because every company is different.” Okay I agree with the latter part of his comment but it’s because every company is different that it is indeed possible. Many companies can calculate their ROI; they just don’t, for a variety of reasons.
Typically not measuring trade show ROI goes unnoticed when sales are robust and profits are good or if the overall economy is strong. But when the bottom drops out, as it always does, for some reason or another, we’re left with CEO’s, COO’s, CMO’s, and the scariest “C’” of them all – the CFO – asking why the heck you’re spending all this money on trade shows?! What’s the ROI?
Some great companies, regardless of size, have figured out a way to measure ROI. Whether they’re using some of the methods noted in our previous two articles, including full utilization of CRM programs or a home-grown program to measure their results, they’re quantifying and they’re spending accordingly. Others don’t have a clue. They just go to trade shows because, as we’ve heard them say, they’re worried that they’d be conspicuous by their absence.
So what’s the solution? Well, it’s as simple and timeless as a golden ring: close the loop. track costs, track sales. Simple? No. Possible? Yes. It is achievable for most companies if they learn how to communicate their needs to those who can give them the tools to measure the results.
As a means of face to face marketing, trade shows or trade fairs are the oldest form of marketing. No one needs a history lesson on this – it’s simply a fact. Companies who make widgets that attach to other widgets inside of a big widget don’t typically advertise on TV or in the Sunday circulars. Yet their customers know about their widgets and they buy their widgets in large part because of their exposure at trade shows. So historically we know that shows work – it’s just that now everything needs to be quantified.
In today’s world every company faces the same challenges and the same decisions, especially when it comes to marketing. Is print still viable? Does Twitter make sense? Am I better off with a website or a blog? How do I track leads? Where do I get leads? Are my salespeople selling or just taking orders? Am I getting anything out of my trade shows?
We, like you, don’t have definitive answers to any of these questions because every company is different with different channels of distribution, so the answers will be unique to your company, your budget, your systems and most importantly, the quality of your communication.
In this series on Trade Show ROI we’ve tried to present some solutions using both quantitative (CRM) and qualitative (Start with What You Know) methods, but in the end, in this world of constant electronic linkage, the only thing that’s indispensable is excellent communication because everything begins and ends with it.
Do your marketing department and your accounting department talk to each other? After all, marketing is the “hunter” and accounting is the “gatherer”. The two functions are closely tied to each other but how often is accounting involved in decisions relative to customer relationship management systems and trade show ROI?
Talk to management – tell them of your intentions to measure trade show and event ROI. Be proactive – make them your champions if you can. Then talk with accounting and IT. You catch more flies with honey than vinegar especially if the vinegar is mandated from above. So you be the honey. It’s your job to let the experts in their areas give you the tools to do your job
Buy lunch for the accounting department; bring the IT guys new Wii games. In other words, enlist their help. Trade show ROI is measurable but only if you close the loop. You get leads from the show. If you can’t take the time to qualify them and you know your salespeople won’t follow-up on them, there are companies who will provide this service for you. Some solutions can be very economical, so that at the end of the day instead of having a pile of 300 vague leads from a show you have 30 qualified leads that your sales force will be happy to go after. So you can outsource this function in need-be.
Put your leads from each trade show in queue. IT can help with this. Put them somewhere so they can be tagged by show and then tie that to order-entry so that it can be tracked for one year after the show. After one year, you now have your costs from the prior year’s show and you have your report showing how many of those leads converted to sales. Now you will have a ratio which is something that accounting and management will love. For example, if your trade show cost, $100,000, and first year sales from leads received at that show, were $500,000 this gives you a 5:1 ratio – not bad. Most folks in accounting and management would be quite happy with that. In fact they would probably be ecstatic.
If your CRM doesn’t work with your accounting system then sit down with your finance department and develop a strategy so the two can work together even if some type of “bridge” needs to be created in-order to link the two.
We are the most connected generation in history, yet there are times when we actually communicate very little. As Descartes once said, “I think therefore I am.” Well in today’s economy it would be just as fair to say, “I measure therefore I still have my job,” and good communication is the key.
