Dec. 7 (Bloomberg) -- From poker-table salesmen rubbing shoulders with piano makers at the “Cruise Shipping Miami” event to buyers of toilet paper gathering at “Tissue World” in Nice, France, more businesses are hitting the road again.
“We’re expecting a strong cruise shipping show come March, better than the last few years,” Simon Foster, chief executive officer of UBM Live, the events unit of London-based United Business Media Plc, said in an interview. The show drew 10,800 people in March this year, 7 percent more than in 2009.
Reed Elsevier Plc, United Business Media and Informa Plc, all of which recorded double-digit revenue drops last year, are starting to see a rebound in attendance and exhibitors. The hundreds of global tradeshows, events and conferences carry an economic value of about $300 billion a year, and showed growth in the three months ended September after nine quarters of declines, according the International Association of Exhibitions and Events in Dallas, Texas.
Events including “Guns and Hoses” in San Francisco for the police and fire departments; the “New You Expo” in Texas; “Guangzhou Beauty Expo”; the “Cranky & Nasty Live Crocodile Show” in Queensland, Australia; and the “International Conference for Paints and Varnishes” in Moscow may be a barometer of the global economy. As companies ease travel restrictions and revive face-to-face deal-making, event organizers expect to return to pre-recession growth levels.
“Over the past few years the business community collapsed and now the revenue environment is as good as it’s been for three years,” said Alex DeGroote, a media analyst in London at Panmure Gordon & Co. “People are more likely to travel, go on courses or attend exhibitions now.”
Monaco Yacht Show
Informa, which puts on the “Monaco Yacht Show,” “Russian Wood & Timber” and “Salvage & Wreck Removal,” is seeing swelling demand, Chief Executive Officer Peter Rigby said in an interview. Although the Monaco show, catering to the rich and famous, remained largely recession-proof, it drew an even stronger crowd this September, Rigby said.
“Monaco is the main yacht show with 50-meter yachts,” he said. “This year, we even had 100 yachts sitting outside Monaco who couldn’t find berths.”
“Modern Bakery Moscow,” a baked goods tradeshow held every October, recorded a 32 percent increase in attendance with 15,770 visitors, according to organizer OWP Ost-West-Partner GmbH. Visitors at United Business Media’s “Hong Kong Jewellery & Gem Fair” rose by 13 percent to 44,274 in September. UBM said revenue at “Furniture China Fair,” “Black Hat USA” and “All China Leather Exhibition” rose “significantly.”
The growth prospect for tradeshows and conferences is drawing companies including Bloomberg LP, the parent of Bloomberg News, and The Washington Post into the events market. It is also prompting companies to snap up smaller competitors.
United Business Media, the publisher of InformationWeek, in October completed the purchase of U.S. tradeshow company Canon Communications LLC for $287 million and bought a 65 percent stake in a Turkish operator.
“We see our growth position in live events, face-to-face events,” said Foster. “The events we are looking at now are more bolt-on acquisitions.”
Reed Elsevier, the world’s biggest tradeshow organizer with about 450 shows including “Aqua-Therm,” the “PGA Merchandise Show” and TV industry conference “MIPTV,” this year acquired a golf event in China and is looking to buy more organizers in emerging markets like Brazil, India and Russia, said Nick Forster, group commercial director at Reed Exhibitions.
Informa is also seeking bolt-on acquisitions of mainly smaller country event providers, CEO Rigby said.
“We’ve seen an improved performance, but it’s still hard in southern Europe and sluggish in North America,” he said.
Results at the companies are improving after a grim 2009. United Business Media said in October that bookings for its top 20 tradeshows in the next 12 months are up more than 16 percent. In 2009, UBM’s revenue at constant exchange rates fell 12 percent to about 287.5 million pounds ($450.6 million). Most revenue from UBM shows comes from stand and booth sales to exhibitors, followed by sponsorships. In North America, UBM Live also charges entrance fees, Foster said.
Informa’s events and training business, excluding effects from acquisitions, fell 27 percent in 2009 to 559 million pounds. Rigby said much of that was the result of the scrapping of 2,000 smaller shows.
Reed Exhibitions’s Forster said bookings in 2009 were hit “severely.” The unit’s 2009 revenue fell 21 percent and adjusted operating profit sank 28 percent at constant currencies. He said bookings are now looking up.
At FT Global Conferences and Events, the conference division of the Financial Times, growth is forecast at 22 percent next year, driven by sponsorships and delegate fees, said Jayne Van Hoen, managing director of the division.
The company, which puts on conferences such as “The Business of Luxury” and “Digital Media & Broadcasting,” charges delegates between 500 pounds and 2,500 pounds. It typically gets 70 percent from sponsors and 30 percent from delegates, she said.
“While the world is changing, there still aren’t any virtual handshakes out there at the moment,” she said. “For a lot of people doing business face-to-face is still the route.”
The Washington Post Live, the conference division of The Washington Post newspaper group, held its first conference this year when “The Business of the Beltway” event hosted Virginia Governor Robert McDonnell, Hilton Worldwide CEO Christopher Nassetta and Pulitzer-prize winner Steven Pearlstein.
The company wants to “extend the reach of the Post’s journalism,” said Jenny Abramson, general manager of Washington Post Live. Its conferences “connect newsmakers across government, business and academia with audiences.”
Washington Post events have included a Washington, D.C. mayoral debate and a conference with government officials and oil executives on energy. It will host an event on the business of sports early next year.
Bloomberg LINK, the conference arm of Bloomberg LP, began staging invite-only conferences a year ago to strengthen relationships, promote content from its news, product and research departments and develop access to sources, said Robert Bierman, who heads the division. The unit’s target is to be self-funding and profitable, he said.
For long-time event organizers, technology notwithstanding, the demand for conferences and tradeshows can only grow.
“In an electronic environment like we live now, the opportunity to meet your peers or suppliers once a year becomes more valuable,” said Reed’s Forster. “And I think that will only increase.”
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