Selling the Value of Your Trade Show Program

It is not easy comparing the value of trade show marketing with other marketing initiatives since trade shows are multi-faceted marketing vehicles that, if used properly, provide tremendous value in many different areas. Management tends to compare numbers and projected returns when it comes to budget allocations. But comparing “apples to apples” is not easy when it comes to trade shows, and people usually have problems comparing “oranges to apples.”  We have to figure out ways to make it easy to compare the value we provide with the value of other programs, and win that comparison.

First, we have to gather some data about our “competition."  We make a list of marketing programs and initiatives the company is either involved in or considering, but our main focus should be programs currently in place since we will hopefully have access to some solid data in those areas.  So what are we “competing” with? Here is a short list of possible contenders:

• Organic Web Leads
• Telemarketing
• Outside Sales
• Direct Marketing (such as email campaigns, direct mail, etc.)
• Media Advertising (such as online ads, print advertising, TV commercials, etc)
• Channel Programs

Ideally, we want to compare dollar spent vs. dollar earned. How much revenue do we get for every dollar the company invests for each marketing/sales program? Unfortunately, different programs might not have that data readily available. They may use other metrics like cost per impression, cost per lead, cost per converted lead, etc. You will find information in sales reports, campaign reports, corporate annual reports, and similar sources. You might also get information from your peers, sales and/or marketing management, or your CFO. Asking your CFO for data and help is often a good idea and gives your comparison an additional degree of credibility.

Once we have the data we need, we calculate everything down to a revenue vs. dollar spent model. For example, if it costs your company $60,000 per year to maintain your website, and you have $475,000 in revenue coming from organic web leads, you divide revenue by cost and end up with a number. In this case $475,000 divided by $60,000 means that we have $7.92 in revenue for each dollar it costs the company to maintain the website. Now, organic web leads always tend to have the highest return but you can not scale them properly; you can create more web traffic, but that is online advertising and has its own ROI math. Since most organic marketing has a very high ROI but does not scale, I propose we simply leave those out.

Below is an example of how a comparison may look. I used fairly random numbers just to illustrate the concept. Odds are that trade show marketing will not have the highest ROI after discounting the organic web leads; that is until we get a little more creative.

Our next step is to make our numbers more favorable. There may be costs in our trade show budget that arguably should not be attributed to us.  So we have to put a price tag onto the other value we provide, such as PR and media opportunities or cost savings for sales.

For example, we have outside sales; there are a number of clients that need some face time. For our example, l assume we can arrange meetings with 50 important clients per year at trade shows that otherwise would have to be visited. Assume that each visit would cost $1,300 in airfares, car rental, hotel, etc.  So we just provided outside sales with a value of $65,000.

Trade shows are also a great place to conduct customer research and competitive research. For the purpose of our example, let’s assume we can save Product Management $40,000 per year by doing some of that research at shows rather than other more expensive methods.

Then there is additional media coverage. Due to our unique booth and media savvy, we get a lot of local media coverage which has an advertising value of $200,000.

The last item I am going to put a price tag on for our example is “executive involvement.”  Executives usually have some desire to personally talk to key clients and hear feedback from real customers. This one is the most difficult to put a monetary value to, but for our example, let’s assume we save $80,000 per year due to reduced travel and saved executive time.

There are many other items we could try to put a dollar value to, such as increase in brand awareness, networking opportunities, partner recruitment, etc.

The new cost for our trade show program is quite different:

In this example, when we remove expenses that the company would have from our trade show costs, the “actual” cost is only $110,000, which means we have a return of $8.55 for each dollar that is specific to actual trade show cost.  Granted, the math we used here was a little creative, but trade shows are often disliked and disrespected by management because of their seemingly high cost and hard to interpret results. We just took this disadvantage and turned it into an advantage. And yes, the numbers I used in this illustration are a little strong, but I just wanted to teach you the concept.

The other option is to increase the value of your program. The changes in ROI are less drastic, but your numbers will also receive less scrutiny. In the example above, we deducted $410,000 from our trade show budget to only leave the cost that should only come from our budget. We also had $940,000 in revenue directly attributed to our shows. So if we take that revenue value ($940,000) and add the additional value we created ($410,000), we end up with a total value of $1,350,000. In both cases we have shown that there is much more value to trade shows than initially meets the eye. It is up to you to decide what factors, numbers, and formulas meet your specific requirements and situation.

It is not that hard to demonstrate to management that trade shows are a great investment and provide tremendous value. You can even use those numbers to go budget poaching.  Since you provide so much value and cost savings to other departments, you can argue that it is only fair if part of the money that would normally go to them should go into the trade show budget.

About the Author

Linda Musgrove is President of the Trade Show Training firm, TradeShow Teacher. She focuses on teaching companies to significantly improve Trade Show Results through strategic, customized Trade Show Training for individuals, departments or entire teams. Training options include phone consulting, webinars, seminars and one-on-one in person coaching. Musgrove authored "The Complete Idiots Guide to Trade Shows", published by Alpha Books/Penguin Publishing. Learn more at http://www.tsteacher.com and sign up for the FREE monthly Trade Show Tactics newsletter. Follow on Twitter at: http://twitter.com/tsteacher.