In the 12 years Tarsus has existed, the company has completed five major brand acquisitions, established itself in both the mature US market and the emerging markets of Eastern Europe and the Middle East.
Smaller and nimbler than many of its contemporaries, the company grew to tackle more than just exhibitions, operating in the publishing, conferencing and Internet markets for several select sectors.
According to Tarsus MD Doug Emslie, it’s all a part of the company’s maxim to be a “mile deep rather than a mile wide”.
The first business Tarsus acquired was Labelexpo, which had three exhibitions in Brussels, Chicago and Singapore, as well as a magazine in the UK. That business has developed into 10 exhibitions, the magazine is in numerous languages and there are lots of other products including conferences. It represents the model Tarsus strives to create.
“In 1999 we bought a discount clothing business in America,” continued Emslie, “which a lot of people had looked at but didn’t want to buy as it was a tent in the middle of the desert in Las Vegas. Most people wanted to be in high-end fashion, and our purchase was before the low-end market became what it is today. Now, about 40 per cent of all clothing in America is bought through discount retailers and our trade show has grown dramatically as a result.” It turned out to be a very telling acquisition because Tarsus saw that market early, and benefited from its growth.
The company’s next step was France in 2000, where it built its business until the recession hit in 2001. In 2006 it made a big acquisition of a medical business in America focused on anti-ageing for US$50m, followed by the Dubai Air Show in 2007.
“What we like are markets where there are lots of dynamic changes going on, or geographical change. In the low-end clothing market, for example, we could see it was going to be a growth market in America,” says Emslie. “In the medical market, as people are getting older and richer, they are more interested and proactive about health and prolonging their lifespan. Aviation’s big growth markets are the Middle East and Asia and that’s where we are.”
As for taking existing show formats into the emerging markets, Tarsus plans to adapt its models to suit the region. In the Middle East, its business began with eight shows and now has 11, with scope for more organic growth. “We’ve opened an office in Abu Dhabi and have two to three launches we are looking at now,” says Emslie, pointing to other Middle East growth in Egypt, Turkey and Saudi Arabia.
Another market Tarsus is growing in is China, where it has three businesses: a wholly-owned business; a joint venture vehicle with 24 exhibitions in central China, forged with a company titled Hope; and a partnership with World Expo.
“That is a very immature market and there are lots of opportunities to launch shows. What is happening is a lot of the manufacturing is moving out of Shanghai and Beijing and moving into the centre as they have surplus labour and it’s a lot cheaper,” says Emslie. “We see that as a very interesting dynamic change so we got into that market early.
“There are some fantastic facilities now in central China. It is very competitive and a lot of people are a bit scared, but once you get in there, you learn some lessons and we’re now quite comfortable with it.”
Emslie has clear views on the benefits of working in partnership to break into new markets.
“A lot of people go into new countries and create partnerships, which helps a business move quicker in the early stages,” he says. “But the problem with partnerships as they mature is people forget where they started and who had the power in the beginning; it might not be the partner with the power at the end.
“My experience of partnerships is you get half the profit for double the hassle. We are careful about setting up JVs, and in places like China it’s quite important but it doesn’t mean you can’t do it yourself. We were told we couldn’t launch Labelexpo by ourselves but we did and that gave us a lot of confidence,” he comments, intimating that the preferred method of international expansion for companies including UBM is optional for Tarsus. “There is a balance, people often default into partnerships, but I don’t believe you need them all the time.”
What Emslie says is not optional is bonding closely with customers – both visitors and exhibitors.
“Our ethos is to spend a lot of time not just with exhibitors, but to also stay close to and understand the buyers,” he says. “Ultimately, buyers determine where an exhibition goes. As an industry I think we forget that because we spend 95 per cent of our time flogging space to exhibitors, and only five per cent getting buyers to come.”
Additionally, he says, we have to be aware we’re going to get lots of competition, especially in new markets. “The year after we launched Labelexpo in China we had four competitors. The strength we had was that we were taking international companies to Chinese buyers.
“I think we will see a lot more companies doing 50-50 or 60-40 joint ventures rather than acquiring 100 per cent, whereas in the West full acquisitions are normal. What we have done is been successful in buying businesses created by entrepreneurs and keeping those entrepreneurs on-board.
“In China, we bought 50 per cent of the JV business because we wanted to be certain that the next time we turned up, the partner had a financial reason to be there.” But Emslie concedes that business partnership is taking time to yield fruit. “It hasn’t grown as quickly as we thought, and a lot of that has to do with our approach to business versus the Chinese approach. They interpret growth as launching lots of shows, which might be not profitable.”
So while others find a hand to hold as they press into uncharted territories, Tarsus is willing to go it alone. It will be interesting to see if the model continues to work as these markets grow more manageable.
Any comments? Email exhibitionworld@mashmedia.net
