Home to much of the country’s exhibition business, California, the most populated state in the US includes eight of the country’s 50 most populous cities, namely Los Angeles, San Diego, San Jose, San Francisco, Fresno, Sacramento, Long Beach, and Oakland.
Half the world’s registered exhibitions take place in the US. Its market size and growth potential, the largest in the world, makes it an attractive prospect for investment. And while mature markets are given short shrift in the strategic announcements of today’s organisers, there is no denying the US, and California in particular, present international investors with an exciting prospect for business. Events in the US are run predominantly by associations, often without the involvement of professional organisers, meaning the rewards for an entrepreneurial approach, innovation and a black book of international contacts can take a company a long way.
The trade show industry in California is a considerable component of the state’s economy. Bordered by Mexico to the South, and a short drive from Las Vegas in Nevada to the east, California has access to multinational businesses and a wealthy visitor base familiar with the notion – and value – of trade shows.
Comical success
San Diego is the home of America’s beloved Comic-Con International pop culture event. The city has emerged as a top location for biotech, healthcare and other emerging knowledge economies. With an abundance of educational research and healthcare institutions, healthcare companies present make it a useful place for events aimed at this industry.
In October, the California Coastal Commission approved the San Diego Unified Port District Port Master Plan Amendment for the expansion of the San Diego Convention Center (SDCC) and the Hilton San Diego Bayfront Hotel expansion. The approval was the final permitting requirement for the US$520m convention centre expansion project, a multi-year planning process to increase public access to the waterfront, activate an underused part of downtown San Diego’s waterfront and meet the demand for an expanded facility, which will include an additional 20,900sqm of exhibition space, a 7,432sqm ballroom, five-acre rooftop park and 500 additional rooms for the Hilton San Diego Bayfront Hotel.
Limitation on visitor numbers at the San Diego Convention Centre (SDCC) has halted the show from growing beyond 125,000 people a year since 2007, prompting the organiser to consider moving the show to Anaheim, Las Vegas or Los Angeles after the original SDCC lease expired.
“Many of our clients who have been outgrowing the current facility will now be able to book well into the future,” said president and CEO of the San Diego Convention Center Corporation (SDCCC), Carol Wallace, adding that the expansion is expected to break ground in late 2014.
As in many markets around the world, show dates can make or break any event. Securing dates at popular exhibition centres in major US cities has always been a distinct difficulty for organisers.
“The southern convention centers are becoming increasing popular due to the advantageous right to work laws,” says Kara Krause, of EJ Krause & Associates (EJK). “Union costs and restrictions occurring in many of the northern convention centers have caused many organisers to reconsider their event locations. These obstacles have had a significant impact on industrial and manufacturing events.” EJ Krause is one of America’s largest privately held exhibition management companies, with offices on three continents producing 35 events in 16 different industries. Around 80 per cent of its business sits outside the US.
Of course creating a strong infrastructure is also extremely important in ensuring success in the US, Krause says. Other ways to launch into the market involve acquiring already established events, laying the foundation to develop additional events, or forming joint ventures with domestic US organisers in the know about the competition, and working prerequisites of the labour unions.
Renovation in LA
Nearby, the Los Angeles Convention Center, home to leading video gaming show E3, is showing its age. But a new deal struck in October between City Council members and venue operator AEG, means that for five years AEG will earn between US$175,000 and US$350,000 if it meets certain targets, notably raising revenues and bookings. The decision follows a year of negotiations to find a private operator for the city-owned facility that is hoped to bring LA back into contention as a home for trade shows and conventions. Privatisation was debated and championed by former LA mayor Antonio Villaraigosa, with the move expected to save money and increase tax revenues for the city.
For its part, AEG hopes to use its international contacts entertainment firm can leverage its booking power to bring in a greater variation of events, including the larger international shows. “It’s been a long road and there’s been some twists and ups and downs, but we’re ready to get going,” commented AEG’s chief legal and development officer Ted Fikre.
North-east of Los Angeles lies Las Vegas, where much of this innovation and variety can be seen in action. The Las Vegas Convention Center (LVCC) is home to the world-leading Consumer Electronics Show (CES), among other major events. The Las Vegas Convention and Visitors Authority (LVCVA) recently completed a US$20m renovation of the LVCC, part of a wider US$2.5bn improvement project underway at the Las Vegas Business District. The LVCVA implemented the changes to the LVCC over the past two years while working around shows and events in the building.
“It is important to keep the facility fresh and offer its more than a million yearly guests the convenience that will make conducting business in Las Vegas a success,” said senior VP of operations for the LVCVA, Terry Jicinsky. “The Las Vegas Convention Center is home to many of the country’s top trade shows.”
All of the improvements will be integrated into future plans for Las Vegas Global Business District, an overarching vision for the LVCC and the surrounding area. The US$2.5 billion
Global Business District aims to create an international business destination by incorporating major renovation of the LVCC, leveraging the world Trade Center designation, and developing transportation connectivity through a centralised hub.
Putting venue and location aside, America continues to be the land of opportunity and in California, as everywhere, it’s possible to make exhibition business work if the offering is right. Krause claims innovation and creativity are strong selling points in establishing successful US events, advantageous due to the fact the market is “accessible to unique groundbreaking events”. The organiser’s recently launched global summit on mobile technology aimed at senior citizens, the M-Enabling Summit in Washington DC, stands as a good example of this.
While many organisers are looking at the emerging markets – and EJ Krause with its plans to expand into Indonesia is no different – California with its world-leading industry links and improving venues and infrastructure, presents an enticing prospect for any organiser. And of course Mexico, one of the fastest growing emerging markets, is just across the border.
There’s a lot of business to be done in California. As former state governor, Arnold Schwarzenegger said, “California is the easiest sell I ever had”.
Image: The LACC.
This was first published in issue 4/2013 of EW. Any comments? Email
exhibitionworld@mashmedia.net
