Industry Outlook Where Are We Now and Where Will Be Tomorrow?

Especially Prepared ForEDPADecember 2, 2011

By:Douglas L. DucatePresident & CEOCenter for Exhibition Industry Research

U.S. HISTORY Late 1950’s Interstate Highway system completed and

commercial introduction of the Jet airplane. 1959-Las Vegas-Rotunda + 90,000sf exhibit hall 1960-McCormick Place first large facility Real expansion in 1970’s making industry 40 years old CEIR Census identifies more than 14,000 meetings with

exhibitions held each year. 10,000 are B to B events 67% are owned by associations.

FACILITIESHOTEL TO EXHIBIT HALL

Show Room Bellman Catering Banquet Engineering Housekeeping Ambiance in Place

Concrete Material Handling Food Service Furniture Rental Utility Service Cleaning Service Ambiance Temporary

CEIR Census 2010

CEIR Census 2010 Number of U.S. exhibitions

dropped from 11,094 to 11,041 or -0.5%

Added Mexico with 722 events Total U.S., Mexico & Canada

14,541 More than 50% of all the

exhibitions held in the entire world

Average size in U.S. 47,984 NSF +25%

CEIR Census, cont’d.

2,649 or 24% of U.S. events B to C

37% of U.S. events held in exhibition/CC

44% held in hotels 67% owned by associations 33% owned by media companies

and entrepreneurs

How are weDoing Today ?

CEIR Index Report

The Reality of Where We Are CEIR Index was down a record 9

consecutive quarters Index turned positive Q3/Q4 2010 &

Q1,2 &3 2011. In 2010, five sectors had positive YoY

performance Losses in 2008-2010 combined 15%

compared to 2001/2002 loss of 5% Overall back to 2000 level Number of exhibiting companies and

NSF sold the biggest losers

CEIR INDEX 2011

Total Index Real GDP Q1 3.1 2.2

Q2 1.0 1.6

Q3 2.6 1.5

New source produced economic analysis

New approach to calculating averages using geometric method

Restated the first 10 years Established new 2009 base year Added a predictive element to

enhance projecting future performance

Where we are, cont’d

Geometric Averaging

0.25 0.25 0.25 0.25, , , , ,(2) t j t j t j t j t jTIN INSF IATT IEXH IREV

, 1, ,(1) [(1 ( ) /100]t j t j t jINSF INSF pch SNSF

(3) Mi j = f (Oj, FDj, EMj, Zj, RCE, TE)

CEIR Index for the Overall Exhibition Industry

CEIR Index for Overall Exhibition Industry with Forecast

CG Sector vs. Overall Exhibition Industry Total, Year-on-Year % Change

CEIR Index for the HM Sector

CEIR Index for the MD Sector

CEIR Index for the GV Sector

Predict Conference

Deeper recession-peak to trough 5.1% not 4.1% as earlier reported

Improvement Q1 declined in Q2 Index outperforming GDP Index slowed Q1 to Q2 Recovery varies by sector but on

average 3% a year if no further setbacks in the economy.

THE PERFORMANCE OF THE OVERALL EXHIBITION INDUSTRY IN 2011 H1 WAS IN LINE WITH OUR PREVIOUS FORECAST.

Table 1: Overall Exhibition Industry

Metric 2008 2009 2010 20112/ 2011H1 3/ 20122/ 20132/ CAGR, 2000-2010

Net Square Feet -1.4 -10.9 -2.1 2.3 2.8 3.3 3.0 -0.6Exhibitors -2.0 -10.7 -1.1 2.1 1.9 2.8 2.4 -1.3Attendees -3.2 -7.5 2.4 2.5 3.4 2.8 2.5 -0.6

Real Revenues 1/ -3.6 -9.6 -8.4 2.5 1.6 3.9 3.4 -1.2 Total -2.6 -9.7 -2.4 2.4 2.4 3.2 2.8 -0.9Note: 1/ Inflation Adjusted Revenues, adjusted by CPI for all urban consumers (CPI-U). 2/ Forecast 3/ Actual semi-annual percent change

Generation X-Ages 28-39 Generation Y-Ages 19-27 Gen X-20 million Gen Y-60 million Combined…more than the baby boomers Much greater net worth and more liberal

spending practices

THE YOUNGER GENERATIONS

Like the face to face experience to network

Consider attending a professional perquisite

See new products Find new suppliers Learn more about a product or service

they have heard or read about Browse without sales pressure

WHY THEY ATTEND

56% E-mail

19% Direct mail

25% various

HOW DO THEY GET INFORMATION?

POWER OF EXHIBITIONS

Event Messaging – What Resonates? Be genuine…authentic…DO NOT

overpromise Communicate in small bites…easy to digest Use social media CAREFULLY Schedule messages early in the day Create and promote event website Upgrade websites Measure results

POWER OF EXHIBITIONSExhibitor Advice Every visitor is important…treat with respect Don’t speculate on degree of interest Include younger workers among exhibit staff Be prepared to handle young children

(candy, play area, computer games) Interactive versus static exhibit One-on-many versus one-on-one

Questions Can the industry return to pre-2000

levels? Will companies that have reduced to

smaller spaces return to larger spaces? Will destinations cutting essential

services continue to subsidize Convention Centers?

How will destinations know when they can no longer compete?

Exhibitions are the last bastion of face-to-face marketing!

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