PARIS — UFI, the Global Association of the Exhibition Industry, released the latest edition of its Global Barometer, which offers data on U.S. and global exhibition industry trends. The 24th edition of the survey included responses from 438 companies representing 70 countries/regions.
“Exhibitions grew again in 2019, but a slowdown is expected for the beginning of 2020,” said UFI Managing Director and CEO Kai Hattendorf. “The novel coronavirus outbreak, which has already led to many shows being postponed or cancelled in China and Asia, will impact this as well. We all hope this situation settles quickly, as the exhibition industry is using these results to shape its general development plans and how it’s adapting to the continually evolving classic business model.”
Key Takeaways on U.S. Data
Revenues and operating profits continue to grow in the U.S. Nearly three-quarters (73%) of U.S. exhibition companies reported an increase in turnover for the second half of 2019, and 82% are expecting an increase in the first half of 2020. Among respondents, 62% reported an increase in operating profit of more than 10% in 2019 while 23% reported a decline in operating profit of 11% to 50% for the full year. The balance (15%) reported operating profits were stable (between +10% and -10%) last year. “There’s a lot of confidence in the U.S. economy right now,” Hattendorf told TSE.
When it comes to growth strategies in 2020, half (50%) of U.S. exhibition companies are planning to operate in new countries while 20% are planning to develop new activities outside their current portfolios (for example, digital products and services). Nearly half (47%) indicated they are planning to develop activities in line with their current portfolios while 20% report they are staying within their current scope of activities as a venue, organizers or service provider.
What are the most important business issues for U.S. exhibition companies? Global economic developments top the list at 20%, followed by the state of the economy in the home market, competition from within the industry and internal challenges — all of which are ranked the most important business issue for 17% of U.S. exhibition companies citing (See chart). Only 11% of U.S. exhibition companies said the impact of digitalization is the most important business issue, but it has ranked higher in previous years. What does this mean? “As an industry, we no longer feel threatened by digitization but see the opportunities,” Hattendorf said.
As the business model for trade shows continues to evolve around the globe, U.S. exhibition companies are dedicating more space and resources to experiences and activities beyond exhibit space. Adding conference stages on and near the show floor is the most popular, followed by opening meeting spaces, catering/designated food space and off-site events.
“Attendees want events to be more entertaining and enjoyable,” Hattendorf said, citing data from the UFI & Explori Global Visitor Insights 2018-2019 Edition, a quantitative survey of more one million global trade show visitors, resulting 13,000+ responses, representing 135 countries. “Millennials are likely to place a higher value on enjoyment and entertainment than their older peers.”
“They are looking for talks and presentations to be delivered in a different way, good locations, hands-on technologies, informational networking, informal or street food style catering, interactive content and live entertainment,” Hattendorf added.
In response, U.S. trade shows are dedicating space to these new elements. Of those shows with conference stages on and near the show floor, 50% report they are using between 10 and 25% of their total space for this purpose. Others report using between 5 to 10% of their total space for opening meeting spaces (66%), catering/designated food space (50%) and off-site events (33%).
“If more space is being used for festivalization, that means less traditional exhibit space is being sold,” Hattendorf said. “This is putting pressure on revenues. I think we’ll see more sponsorships to make up for those revenues.”
The next UFI Global Barometer survey will be conducted in June 2020.
Reach Kai Hattendorf at (33) 1 46 39 75 00 or kh@ufi.org
