As vibrant as it is, some commentators believe the European exhibition market is quickly approaching saturation. Not only that, but following the recession the emerging BRIC markets (Brazil, Russia, India and China) are beginning to look more tempting to organisers of international exhibitions. No matter which country you launch into, you will face challenges. Breaking into a new market requires a lot of preparation and often a local partner.
EW looks at the best way to be prepared for an international launch.
So, when do you know a show is ready to launch abroad? According to Roger Shashoua, chairman of Global Market Brands, hands-on entrepreneurs who see a gap in a market can choose the timing themselves. “You must check the risk/reward ratio, forget to compete in Europe and be the first in a market where the majors are not active,” he said.
“If you have excellent established brands then the shows are ready to be launched. Either you license them or you launch them in the biggest growing markets, like the BRIC markets. Doing nothing is counter-productive.”
Shashoua says the risk of launching too early is minimal, and the long-term rewards will far outweigh the risks. “On the other hand,” he continues, “the perils of launching late are that your trademarks – no matter how well established – become obsolete or are taken over by others when the trademarks expire or are copied under different classifications.
“For example, you may have trademark protection under ‘exhibitions’ but another may use this trademark by filing under classification of ‘events’. The laws of India, China and Brazil are vastly different from those of Europe. Trademarks in emerging countries expire after two years of non-usage so you can see the danger.”
Unlike Shashoua, ViParis’ deputy director Florent Latarjet believes there is still room for well thought out brands to enter the European market, or at least the Paris market. His company promotes Paris as a show destination and helps organisers overcome the hurdles of launching in France.
“Many organisers might think that Paris’ exhibition market is saturated and difficult to enter,” he says, “but it is an open and active market with around 100 operating organisers and an average of 30 launches every year.
“One distinction is the amount of freedom provided to organisers when they hire an exhibition hall from us. Organisers can choose any suppliers they wish for set-up, cleaning, security etc, and this might be difficult for those who are used to working with venues who don’t allow this. We can help you meet local networks of contractors and suppliers, sort out visas, and find deals with hotels and transport.”
Where to?
How do you decide where to go next? According to Theo Lingmont, director of RAI International Exhibitions, organisers decide where to launch by first asking three questions: “Is it a BRIC country? Is it a country where we already have another international show? Do we have a local partner?
“First of all, you need a professional team with international focus, knowledge of the industry and personal contact with the major clients within that industry,” Lingmont says. “Furthermore, you need up-to-date market knowledge through research, a professional local partner for a joint venture, a communication and marketing plan, and a professional operational team that can support the local partners.”
Paul Dunne, MD of UK organiser Emap, says his company is on the verge of internationalising. Late last year saw the launch of education technology show BETT Middle East, the company’s first event outside the UK. This makes Emap perhaps the timeliest example of an organiser moving its brand into a totally new territory.
“We chose Abu Dhabi because they were willing to commit,” says Dunne. “When you are playing with a 27-year old brand, you have to make the least risky choices.
“In the Middle East and particularly in Abu Dhabi, they are looking to raise their education technology to Western standards,” he continues. “They had a stated objective from Mohammed bin Zayed bin Sultan Al Nahyan, crown prince of Abu Dhabi, last year that he wanted to rebuild and refurbish 300 schools in a year.”
This combination of political will, market demand and support from local authorities indicated a rich market waiting to be tapped.
Mark Snell, group director of UBM Live, agrees that having local infrastructure in place is one of the biggest deciding factors of where to launch a show.
“You always start by size of prize,” says Snell. “That’s always going to be the primary consideration. But also, do you have the infrastructure and abilities to break into it?”
UBM Live last year launched its Technology for Marketing and Advertising (TFM&A) brand in Shanghai, the first edition of the show to take place outside the UK. As an international publisher and organiser, UBM already has more than 50 shows in China annually, so it has a good foothold for launching new products. However, the sheer size of China means it can support more than one of each type of show nationally, where multiple shows would quickly come into direct competition in the UK.
“It is where the majority of the marketing community is,” said Snell. “Shanghai is the business capital of China. India is the next port of call, and Brazil is an interesting market to us, so that will be looked at in 2012 or so.”
The basics
Once you have identified a market and decided to go ahead, how do you go about laying the groundwork for launch? This is the biggest question, and there are a few things you’d do well to look at before charging ahead.
“It isn't a question of size,” says Messe Frankfurt chairman Wolfgang Marzin. “It has a lot more to do with having an efficient global sales network. We generally organise trade fairs where our subsidiaries are also located.
“It makes perfect sense to establish a subsidiary if a trade fair needs to be organised locally, for example. In addition to networking with local partners and associations, it is something that is vital to organising our events optimally while also creating tailor-made interface points and trading platforms for all sorts of business relationships.”
“Doing your research is important,” says Dunne. “It isn’t just about market research; it’s about looking for local competitors. They can be a real hindrance. It’s also about understanding the lifecycle of the event.” He adds that while international competitors can be harder to take on from a brand point of view, local competitors tend to have more local support and are therefore more deeply entrenched.
“Getting local support is important,” he says. “That can be from market trade bodies, government agencies or other groups and associations that operate in the chosen market.”
Law and custom
“Every country has different regulations, tax structures, work permit requirements and more important legal considerations,” says Shashoua. “The rule of law is debatable and enforceability seldom succeeds while personal relationships tend to be more important in achieving results than contractual obligations. This is the main reason why big exhibition groups rely on acquiring an existing locally-operating exhibition company at a substantial price as the preferred route, using the local company as the launching pad for their other titles.”
Having a local office will make your job much easier. Local employees will know local law and custom, be familiar with the tax system and have routes around government issues. Depending on the country, having a local office can help you overcome barriers to entry like supplier rates and international taxes.
“There are two ways of internationally launching,” says Dunne. “The first is cloning and taking an existing brand overseas. The risk here is the possibility of damaging an established brand. The second way is creating a new event, in which case the risk is that it doesn’t have a track record so it might not work.
“Conventional wisdom says launches are loss-making but I don’t believe that. With the first option you are more likely to make a profit than with the second. I say you don’t do something unless you can make some money out of it.”
Research is probably the single most important factor to Dunne. Not only does he emphasise researching the target market, but also everyday things people take for granted. “You have got to take into account tradition, public and school holidays, religious events, and even the weather,” he says. “You don’t want to try to launch a show in the middle of monsoon season!”
As a company, ITE Group is an old hand at launching shows into other territories. “One of the benefits of our network of offices is that we can launch locally-run events too,” says ITE head of marketing, Richard Wightman. “It is not easy to organise an event from a remote location in a competitive market. That’s one of the reasons why international organisers who do not have an established presence in our territories chose to partner rather than compete with us.
“It is impossible to say which is the best method for launching an event in new regions or countries. Issues such as the competitive environment, brand quality, market conditions and the cultural fit between potential partners are all very influential. We do have a preference for working locally and supporting globally, but whether this is acting independently, or with a local partner, depends on a number of variable factors.”
To sum up, research and infrastructure are the two most important aspects of launching a show abroad. Different countries can vary from the established UK norms at every step of the way, and having extensive on-the-ground research will help you foresee and plan for any gnarly legal, cultural or bureaucratic stumbling blocks.
Also, although it isn’t impossible to launch into a new country without a local office, it appears to help immensely. If you don’t have this luxury, look for support from local authorities or trade bodies.
With unprecedented growth in the BRIC markets, the time is right for looking at how to cut yourself a slice of that big, piping-hot pie.
