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Thread: Selling at shows versus media advertising - seeking opinions

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    Default Selling at shows versus media advertising - seeking opinions

    I've done a few B2C shows and expos now and I'm seeing a track record that they are rarely profitable. You can't make back what you spent on the booth fee in the large ones, so if there's any ROI it's just in building your mailing list and PR/branding (getting in front of eyeballs). That's making me wonder if it might be the same ROI to spend that amount of money on media advertising.

    For example, this one show I've done two years in a row, I sell enough to make back only 75% of what I paid to be there. Say the cost all in was $2000, and I only sell $1500. Would it be just as effective in terms of PR/marketing to spend $500 on a print ad campaign? I know that nobody can tell me the answer for sure, but I'm just looking for opinions or experiences if anyone has done this.

    The reason I ask is I'm evaluating the monetary loss of these events compared to the intangible marketing/newsletter list building. It seems to me that with no measurable sales that I can tie directly back to the ad campaign, I'd still be out the $500 same as if I'd done a show. Thoughts?

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    There is a part of your question that I am unsure of. You said it costs you 2K to be in the show and you sold $ 1,500.00 worth of stuff. Now was that $ 1,500 in sales which is how I would understand the question as you stated it or was it goods which produced a profit of $ 1,500.00. You are talking about being out $ 500.00 which makes me think the later. If you sold $ 1,500.00 in goods that had to have some cost so your profit would have been less. Can you clarify that?
    Ray Badger, Turbo Technologies, Inc.
    www.TurboTurf.com www.IceControlSprayers.com

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    Another question - how many of the people who buy something at the show have returned to your online store and purchased there as well?
    Brad Miedema
    Fulcrum Saw & Tool

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    Sorry, those are good questions. I was ignoring the cost of goods, although I know that's inaccurate. I am perhaps idealistic but when I pay (say) $2000 booth fee for the weekend show, I would like to sell at least $2000 to break even on it (ignoring the cost of goods sold because if you include it then I'd need to sell something like $3000 to break even). What seems to be the reality is that I can only sell about 70% of my forecast, so in my example, I sold $1500, leaving me $500 in the hole on the event.

    As best I can tell, nobody returns to my shop to buy again. I am working on that, but don't want to add it to the equation for the moment. In this last show I did a prize giveaway in order to get emails for my newsletter. Might get some sales from that. But that's in the future, so I don't know yet.

    It seems to me that there is just as much un-measurable potential future sales from the events as there would be from just spending $500 (my loss on the show) on a media ad campaign. I could be just stinging from not being able to sell as much as I'd hoped, though. However, in chatting with a few other vendors at the show, they rarely profit from the shows either. So it doesn't sound like I'm "doing it wrong" unless we're all doing it wrong.

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    Considering the cost of goods (can't be ignored) you may actually be losing $ 1,000 for the event. That's a lot of money. You don't necessarily need to make money from an event IF you are accumulating customers that result in future sales. It doesn't seem like that is happening.

    That money may be better spent elsewhere (or saved). If you do a few shows a year it adds up. Online ads, improved site or increased inventory selection may be a wiser use of that money.

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    What kind of B2C show is this? Is the theme or premise of the show consistent with your brand and your offerings? What time of year is the show -- is the timing conducive to people shopping for the products you are offering? Are there other shows, less expensive to get into perhaps, that could be more lucrative?

    From my experience helping my wife sell her pottery at local craft fairs, you really want to consider the history of the show (how long has it been running? a long-running show will likely have an established clientele -- people will know about it), the nature of the vendors at the show (quality products, or junk?), and the demographics of the market served by the show (does the show attract people who have money to spend, or are they bargain hunters?).

    The set up of your booth and how your products are arranged and displayed is important. Having enough inventory and selection (and maintaining that inventory on display for the duration of the show) is important. In our particular case, our products (hand-thrown pottery) are very tactile and each piece is unique, so having customers be able to see and handle the goods in person, and able to pick the particular piece that they like the best (among those on offer), is important to making the sale.

    While we have had some customers from shows track us down after the show to purchase more product, more typical is developing a repeat clientele at the show -- people who look for our booth specifically year after year. We do fairs that are local, so that helps in establishing a connection with our customers. While it is not exactly a retail shop, we do have a physical location in the community (our studio) where these customers could find us. One of the things I am ultimately getting at here is I am not sure that retail shows train customers to follow up with online shopping.

    The market for an online shop such as yours is distributed across the whole country. Consider what the density of customers for your particular product offerings might be in any given area. General retail shows might be a challenge. Are there themed-shows that would tend to attract your target customers in higher density?

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    I am going to have a long rambling answer here but want to share some of my thoughts.

    A show can have other benefits besides sales. It gives you a first hand chance to interact with customers and get their reaction to the products you sell in a way that you can't do selling online. Sometimes you may also see other products that you can add to your line. However since your sales were $ 1500 and the show cost you 2K, if your profit margin is 50% then you made $ 750.00 on an investment of 2K. The show is not paying off for you. You lost $ 1250 by displaying at the show. The other thing to is if you primarily are an online business, local business may not be worth chasing. If you had a retail store than that might be different. It is always possible to add things to your product line that will make a show like that profitable but at the moment I don't see it as a good investment for you.

    If you haven't done it that money might be better spent attending a show like the big Pet Show in Vegas in June at the Mandalay Bay or the one in Canada but in saying that I don't know that much about either show other than there are over 1000 exhibitors and 10K attendees. There are most likely lots of new products there that might let you add unique new products that will grow your sales.

    A dozen years ago we were doing 26 trade shows a year. We are now down to about 6 or 7. Trade shows have been declining in popularity with the growth of the internet. Many of the shows we used to do no longer even exist. There was one in Boston we had been doing for 18 years but had watched it decline each year. We did that one in December and in January heard that it was closing. Basically if a show didn't seem worthwhile we have dropped it but the only way to find out is to do a show.

    We rarely sell much at a show but do look at it as advertising and do feel we get enough results from the shows we do to be worthwhile. The last show I did was in New Orleans and was for rental equipment. I had about 5K in show expense plus we ran a full page ad in the show daily each day that was supposedly usually 8K but the offered it to us for $ 1500.00. Truthfully I did not see any results from the ad. We did sell two units at the show for about 12K with a profit of about 5K so like you, we lost 7K by doing the show. I do think we may get some business yet but who knows. We did have enough interest that we have signed up for next year. I won't be doing the ad next year.

    Business is about trying things and learning from our mistakes. It is about figuring out what works and what doesn't and doing less of what doesn't and more of what does. Personally I don't think the show is paying off for you. I would put your money elsewhere but knowing where to put it is perhaps the tough part.
    Ray Badger, Turbo Technologies, Inc.
    www.TurboTurf.com www.IceControlSprayers.com

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    Great feedback, and it all kind of echoes what I've been thinking. Not echo chamber (bad) but confirmation of my suspicions. In this past show (that triggered the OP), I had three goals: sell $2300 in goods, clear out all of my cat, bird and rabbit merchandise, and get 100 email addresses for my newsletter. I did succeed in clearing out the unwanted merchandise, and got 59 email addresses. So there was partial success, and now I'm in a position where I can pivot my shop focus that I mentioned in another thread (safety products for dogs).

    But as to the rest, yeah, just going to the show to make a profit or build my customer base isn't working. It is an established show with a good reputation and people come to buy. So it's good in that way, but I agree with you that since I don't have a local b&M shop they can come back to, I won't likely get much follow up from it. I think next year I will just do a large magazine (targeted) ad campaign instead.

    (I do a few smaller niche events that have very low cost to enter, and I successfully make a profit. I'll keep doing those.

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    You might want to think about putting the ad money into online advertising rather than magazine advertising. Magazines are dying. We had two magazines that we advertised in that folded up in the last year. Back at the time when we were doing 20+ shows a year we were also spending 120K on print ads in magazines. We have cut that back to about 15K now. I am more interested in reducing the 15K than expanding it. We don't do any online advertising at the moment but may start doing some and I do think it has a better chance of paying off than print. The problem I would see with your business is that there are so many companies in the Pet business that online advertising may not be cheap.
    Ray Badger, Turbo Technologies, Inc.
    www.TurboTurf.com www.IceControlSprayers.com

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    Oh, of course I may consider that also. I do boosted Facebook posts every other month with a small budget. Once I finish my pivot, maybe I'll just increase my budget for those instead of a magazine ad.

    Although I would like to do a test ad in something like Modern Dog or Nova Dog to see what the results are like. But all of this has to be evaluated and budgeted for, so I'm not in a hurry to do anything right away.

    I also do plan to go to SuperZoo in Vegas this year. I need to find suppliers of new products, and also get myself educated on a few more things.

    By the way, speaking of education, the neighbor vendor I mentioned was a case study in everything you guys have advised me not to do. It was interesting talking to him. Been in business for 5 or so years, started out selling GPS tracking systems for children, then branched off to GPS trackers for pets, then added pet nutrition, then toys, then travel kennels, then.... basically chasing anything that sounded like it might sell. His business name sounds like he sells satellite equipment or service, he has no logo, and his website clearly shows the lack of focus because he has a menu for all of those things I just mentioned. I didn't ask him any financial info because that would be rude, other than to ask if he ever profited from vending at that show. But I'd love to get a gander at the train wreck that his year over year P&L must be. It didn't sound like he's profitable yet, so he must be shoveling money from his personal accounts into the business fairly frequently in order to afford the cost of all those new goods, which he then often has to liquidate at cost. (To be fair, I've done all that also, but I'm learning and working very hard to get my business to sustain itself.)

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