EN guest editor, CloserStill and Nineteen Group chairman, Phil Soar shares the lessons he wishes he had known 30 years ago.

No, this isn’t about wishing I knew how to talk to girls (though it might have helped), nor that buying Apple and Microsoft shares would make me rich, nor betting at 10,000 to one that Chelsea would win two European Cups

It is about what would have been useful to know when starting out on three decades of running trade show companies.

  1. What is a trade show?

I joined Blenheim in 1989 and two days later, as CEO, was ordered to address a meeting of potential investors. I waffled on about the quality of our brands, the databases, three dimensional magazines and heaven knows what else. I had no idea what I was talking about and, judging by their response, nor did anyone in the investment community at the time. It took me a long time to work out that the real value in trade shows lies in two very different things – the barriers to entry which the slot system offers, and the subscription system of a rigorous re-book.

  1. Don’t bother with the Messen

I’ve spent much of the last three decades trying to launch shows in Germany, or buy shows from the Messen. They don’t like the “Anglo-Saxon” interlopers and they never will. Some smaller venues (Essen, Nurnberg) will talk, and the last 5 years have seen a loosening after the collapse of CeBiT. But the energy would have been far better spent elsewhere.

  1. That buying trade shows would be a one-way bet

Well, almost always. K3, Penton and one rather recent local example are very, very rare exceptions.

In 1990 we could and did buy great events for four times earnings. You could have bet a lot of money against the London housing market in the last 70 years and lost it all. The same with trade shows. Looking back, buying them and then selling them to a new buyer a few years later has pretty much been a one way bet. It doesn’t mean it will be so forever, but I wish I had borrowed far more and bought far more in the last three decades.

  1. People in the exhibition firmament are generally lovely

There are exceptions (we know who you are) but it is a very friendly, very warm business. Largely, I think, because almost everyone joins by chance. We don’t attract aggressive McKinsey consulting types, or know-it-all MBAs.  I think of only two Oxbridge graduates – and they are very nice (like Corina Bauer). People come along to do interesting jobs, everyone has to be a team member, working hard and enjoying the camaraderie. I came from magazine publishing, which is much more Darwinian and competitive and I didn’t grasp the difference for quite a long time. (Sidebar: If there were more MBAs, then perhaps 70% of events wouldn’t still price at a point other than £xx9).

  1. It’s statistics free!

 

  1. The suppliers are not our enemy, they are our friend

Almost every CEO or financial director coming from outside believes that their mission is to cut costs – a pound off shell, 10% of the tenancy costs or we will switch to ExCeL. Good business? Not necessarily. I cannot repeat often enough that we are a symbiotic arrangement. Venues and suppliers have to make profits as well (suppliers often run at just 5%) or they will disappear – and look at the problems Freemans doing just that lead to, or what the disappearance of the NEC would do to us all. The health of the industry is the health of everyone. Good personal relationships are worth far more than a few pennies here and there – we acquired The Furniture Show and later RT on a handshake because of many years of sane, sensible personal relationships.

  1. There are few economies of scale in our business

Unlike most businesses in the world, you don’t make better margins by having 100 events rather than 50 doubling from 100 to 200. You can observe this in the profit patterns of our larger groups over the years – margins very  slowly decline as they get larger. And the bureaucracy needed to manage 100 events rather than 50 grows out of all proportion to the growth in revenues (perhaps it shouldn’t, but it does). Added to that, a bad centralised CEO decision at the core of an exhibition pyramid system can damage a whole world of trade shows.

  1. You don’t own the shows

You might think you do, but you almost certainly don’t. You might own the “name” but there are plenty of possible event names out there (we are not CocaCola or Bentley). The real ownership, in varying percentages, is split four ways – among the venues, the exhibitors, sometimes trade associations, and the organiser. Examples of completely misunderstanding this basic fact are quite common – Interiors (the most egregious example), various Caravan Shows, Mac Shows, Networking events, PC Forums. Take care not to be the next example of missing what a trade show really is and who really owns it.

  1. Talking to government is a waste of time

 I can’t recount the number of times I have sat with government ministers (and once even with the President of France), or heard them speak at our events, and tried to generate support for an industry (our’s) which generates enormous wealth and is one of the very few world leaders in Britain. My summary – a waste of time.

There is no government policy or support for us and the DCMS fiasco over Covid was almost a final straw.

We now have an increase in corporation tax, a reduction in investment incentives – the Centre for Policy Studies predicts a fall of 5.75% in investment over two years as a result of these policies. What does this mean for trade shows? Well, one thing for sure is that our largest six or seven companies  – all of which except Hyve have more than half of their turnover outside the UK anyway – will not see UK investment as a priority. We will be more and more like the FTSE 100, for whom 80% of all revenues comes from outside the UK. But you know all this, and there is no-one in government or the civil service who wants to hear it anyway.

  1. 25% margins don’t mean we are geniuses (genii?)

In 1993 Blenheim Group had the 9th highest profit margin of all the 2,500 companies quoted on the London Stock Exchange (the other eight were all brewers or oil companies). We were in the top 10 (out of 2,500) in both profit per employee and turnover per employee. The FT spent much time trying to work out what was going on. Was there some genius at play? Absolutely not. We just happened to have come upon a little known industry which was (a) protected by slots, (b) protected by rebooking and (c) most mysterious of all, was consistently ignored by the major media groups of the day. But even we at Blenheim didn’t understand those truths.

  1. That the internet would not destroy trade shows like other media

In 1994 I sat in on a Daily Mail Group board meeting (as an advisor). DMG were deciding whether to invest some £320 million on a bid for Blenheim, or £150 million to buy the Nottingham Evening Post, a single newspaper in a medium sized city. They opted for the Nottingham Evening Post. In 2023 that newspaper (owned now by Reach) has a circulation of just 10,000 and is arguably worthless. In 1994 Blenheim was the biggest trade show company in the world and, after being sold, became the core of UBM, the core of VNU’s US business and the largest part of Reed Exhibitions – France and Germany.

For my first 17 years I was a magazine publisher, trade shows were barely even the poor relations of b2b and consumer magazines, newspapers, TV and even radio. Even as late as the break up of EMAP in 2007, their trade shows were undervalued compared with their magazine and radio assets.

In 1989 TV Guide, the US magazine which does what is says on the tin, was sold for $3 billion. That is still the highest price ever paid for a single magazine. A few months later Blenheim bought Batimat, the largest trade show in France, for around £8 million.

Some 25 years later, TV Guide was sold to a small PE house for $9 million (a loss in value of 99.7%). RX have never sold Batimat, but it would probably be worth £500 million (an increase in value of some 60 times). Not a single person in 1990 saw any of this coming.

  1. Organisers avoid difficult subjects

It seems preferable to organise a clothing show than one on Acute Oncology. This is obvious – the specialist detail needed for the former is far, far less than the latter, particularly the conference content. CloserStill started with Vet, Dentistry and Pharmacy shows. How could there have been open slot opportunities in such obvious subjects? Because all three required high-quality, unimpeachable content. Because organisers feel secure in their 25% margins they are reluctant to invest in tougher areas which require more staff (often better staff) and more intellectual input. That means the opportunities tend to be in the more intellectual areas.

  1. You don’t have to plant flags

Geo-cloning became an obsession after around 2007. RX and Informa have perhaps 40 flags around the world. One consequence is that their performance can turn into a proxy for the world economy. Often it can seem easier to transplant an existing product 8,000 miles than come up with a new idea closer to home. The obsession with China (and the “Far East”) in the 2010s was almost embarrassing and often driven by non-exec board members who had read something in the Sunday Times at the weekend (known in many industries as the “Sunday Curse” as a result). More flags don’t mean excess profit. They certainly mean more overhead an extension of risk. They mean more and more executives who are harder and harder to control. We are not Coca-Cola – where it is a matter of shipping the very same product to more markets. What really matters is whether you can run good shows – not where they are located. They don’t have to circle the globe. They can be in a small number of very focussed countries – they just have to be good shows.

  1. That Peter Jones and Alison Jackson were wonderful

 15. Everyone is the hero of their own lives

When you are dealing with your boss, or your staff, or your customers, or your suppliers – never forget this. It’s a great insight for every sort of personal interaction and would have served me well if I had realised it sooner.