Think of your annual trade show from 2019 as Walmart: a great place for the members of your industry to shop, check out what’s new, and learn about products and services that they need to be successful. It was the ideal place for suppliers to generate leads, meet new prospects, and to write orders. Everything under one roof, a convenient way for your industry to efficiently conduct business, build relationships, influence a buyer, pry a buyer away from a competitor, and explore what the marketplace has to offer.
Your trade show prior to COVID-19 was just like Walmart because it was primarily a physical place: brick and mortar, with a large environment filled with booths, displays, demonstrations, SWAG, and energy that was palpable. And, everyone had to come to you. For now, that’s over, and probably will be on any major scale until 2022 at the earliest.
Amazon, of course, competes with Walmart, and with a few exceptions it is a virtual store: an e-commerce marketplace, exploiting a business model that doesn’t rely on a physical environment that you must visit in order to shop or do business.
Until now, your trade show has been the equivalent of Walmart for all of the above reasons. Now your future needs to look a lot more like Amazon, essentially a virtual commercial marketplace. Think of your 2021 trade show as a digitally delivered experience via a computer screen or mobile device using a new tech platform allowing products and services to be sold in very different ways such as virtual demonstrations, infomercials, online chat, videos enabling online sales, and one-on-one conversations that don’t rely on kissing all of the frogs suppliers must endure and that shoppers don’t love at a traditional trade show.
And, Amazon is not just in the retail business, just as you aren’t only in the trade show business. Amazon generates 50% of its revenue from retail; the rest is subscription services, third-party sales, and web services, among other revenue streams. Your association has publications, certifications, and other revenue sources that can be mobilized differently now that you have to reinvent how you generate revenue.
Side note: Companies are valued and compared using what is known as a P/E ratio, the price to earnings ratio. This is simply the price of the stock divided by the earnings per share. Why does this matter? Well, for starters, Walmart generated approximately $514 billion in fiscal 2019 revenue. Amazon produced about half of that, about $280 billion. However, the P/E ratio for Walmart is 23. Amazon, on the other hand, has a P/E ratio of 126, almost 500% higher than Walmart, which has twice the revenue. Why? The marketplace views Walmart as a retailer (trade show), versus Amazon, which they view as a tech company with much better long-term growth and profit potential. If you weren’t a non-profit, what would your P/E ratio be?
So, what’s stopping you from being Amazon and not Walmart? Amazon has a massive database of customers; you have a massive database of members. Amazon aggregates companies that want to sell to its customers; you have suppliers that want to sell to your members. Amazon has a website; you have a website. Amazon is a trusted brand; you have a trusted brand.
There are, however, two primary things Amazon has that you don’t. First, they have a commercial technology platform that enables shopping and buying. And, second and more importantly, they think digital, not analog. Trade shows are analog. You must be both.
The good news is that you can change how you see this opportunity in an instant. Right now! No cost, no investment, no approvals needed, no further study required. This is step one.
Step two is to learn more about the technology, the options, and the capabilities required to adopt a new year-round commercial, business-to-business marketplace, just like Amazon. And to embrace the virtual hosted buyer model that will deliver the opportunity for your members and suppliers to do business in 2021 via a trusted broker...YOU.
We will get back to live, in-person trade shows. I am sure of that. In the U.S. alone, there are reported to be over 13,000 trade shows annually. America and the entire global economy need these physical marketplaces back in business. But for now, adopting this new digital-first approach will not only be a bridge to 2022, it will be the foundation of a new omnichannel future that your organization needs to compete in this next decade.
A cautionary tale: it took Walmart almost 10 years to adequately compete with Amazon. They made a major acquisition of Jet.com in 2016 after recognizing they couldn’t do it on their own.
Don’t wait, don’t try to do it on your own. It’s time to buy, not make. Associations seldom have the resources, expertise, or time to build this capability in-house. Make 2021 count--bring this capability to your members and suppliers this year and build the bridge to a new commercial marketplace that blends the best of the trade show physical environment and the efficiency, lower cost, and higher margin operating income of the new year-round marketplace opportunity and virtual hosted buyer model to your organization.
Drop me an email (email@example.com) if you want to know more.
Founder & CEO
360 Live Media