The Role of Tradeshows
This industry has had the historical mindset of, “If we do not attend the _______ show, the industry will think something is wrong, so let’s go, it’s just easier.” But easy isn’t strategic. Pre-COVID, many trade shows were already struggling to stay relevant. In the last several years, many shows have gone to the wayside, or had to consolidate to stay relevant enough to continue to move forward; IBS and KBIS, Remodeler and Deck Expo. The list goes on. The shift away from trade shows has been happening for years, COVID just gave companies a rationalization to make that shift happen even faster. The fact is, trade shows are merely one vehicle for engagement, but the expectations of engagement have been evolving whether you were an exhibitor or not.
Note: Historically, companies used 30-40% of their total marketing budget for trade shows (national to local). Moving forward that may very well transition to 5-15%.
Will there still be trade shows in the future? Yes. This continues to be a relationship-based industry. People like to engage with people, touch and feel new products, get a snapshot of what is “new” in the industry and see past colleagues. But make no mistake, trade shows are merely one of many avenues to engage with your key audiences.
Within our industry, some of the larger brands spend (all in) over $1 million to attend a national 3-day show. The average investment is probably closer to $450K, or $150K a day. Today, there are many companies now asking themselves, “What could I do with $450K to engage more deeply with a fine-tuned and targeted list of my preferred customers?”
Note: Shows are no longer about leads anymore, as there are so many more efficient and targeted ways to develop a strong lead engine. If you are waiting for shows to drive your leads, you may have bigger issues. If you are executing a marketing automation platform (by the way, you should be), you should be obtaining leads and nurturing them from several different lead sources.
5 Steps to Stronger Customer Engagement & Profit
- Analyze Your Current Customer Mix
- Define Your Ideal Customer
- Create a CX (Customer Experience) Journey Map
- Develop a Customer Engagement Plan
- Align the Plan to Your Sales and Marketing Approach
Analyze Your Current Customer
How many of your current customers are unprofitable? My guess is you may have no idea, which is very dangerous. For many companies, if their business overall is profitable, they’re usually not worrying too much about the unprofitable ones. But they should. Studies show that for the average company, nearly 30+% of your customers are unprofitable. Quite simply, unprofitable customers consume more resources than they pay for. This diverts attention and investments into building more loyalty with a company’s most profitable customers.
As all customers aren’t the same value to your business, you should put dedicated resources on analyzing your customers (defining cost to serve, share position, volume and profit opportunity/versus actual, etc.). Most companies have found that reducing 10-20% of their bad (unprofitable) customers will actually help drive profits up overall, and give them additional capacity (without spending more CapEx) to grow with or convert other more desirable customers aligned to their business and customer profile strategies.
Define Your Ideal Customer
Every architect is not the same, neither is every builder or every contractor. Before you can target your customers, you must succinctly define the profile of what your ideal customer looks like and acts like. For example, no company has the budget to sell and deeply market to all 75K builders. Instead find your ideal builder profile (a subset of all builders) aligned to your strategy and products to help you par down your target audience. Once you do this, it focuses your investments and makes decisions on sales, distribution and marketing strategies more straightforward for your organization.
Too many companies focus all their efforts and analysis on what products to sell or “push” on the market. One should first start with what customer types are more likely to connect with the mix of products you want to sell. It is a very hard task to get a distributor, dealer or contractor who is solely focused on price and commodity products to shift their business to a high-value mix. Start with defining the profile of a customer that aligns best with your strategy and the products that you want to sell. And then dig even deeper and develop detailed personas of each customer type you want to engage with to give your organization 100% clarity of the ideal customer to prospect, nurture and convert.
Create a CX (Customer Experience) Journey Map
Once you define your ideal customer, the next stage is to identify all potential touchpoints to your brand that they may encounter. Why is this important? Because today’s customers value the “experience” a brand provides more so than the product itself. And to make matters worse, one bad experience can lead to 89% of customers abandoning your brand for a competitor. A CX map helps brands more thoroughly understanding their key customer’s journey in the customer’s overall process and all potential interactions with your brand. With this critical knowledge, companies can better understand how to help their customers be more engaged and successful with their brand.
Once you understand their pain points, where they spend their time and how they make decisions on brands they partner with, you will be able to increase value to them, build their trust, and drive more share and profit for your business.
Develop a Customer Engagement Plan
Now that you have your ideal customers defined, and a deep understanding of their journey, it’s time to take this knowledge and develop a plan on how to powerfully engage with them. Marketing approaches that are more relevant to individual audiences have shown to garner stronger purchase rates and profit. Some may use the term account-based marketing (ABM), but no matter what you call it, it’s all about providing marketing and sales assistance that is relevant to a specific customer’s unique situation. Because it’s hyper-targeted (i.e., 750 builders vs. 75,000), you can really optimize the sales and marketing dollars you are investing to drive more value to them, which in turn creates more loyalty and repurchase, especially of your high-value mix categories. In a separate blog, we dig deep into how to leverage social, digital, virtual, AI and other new engagement methods to drive a new level of engagement.
Once you have this process flowing and a deeper understanding of your customer, these insights will fuel how you can optimize your marketing investments and create more leads.
Align the Plan to Your Sales and Marketing Approach
Now that you have the process in place, make it easier on your organization by embedding into your processes. All the previous steps results should fuel insights into your sales and marketing approaches: the two areas most companies have the hardest time aligning. Once you have the approach and metrics defined, now bake it into your marketing automation process. It will automatically nurture leads and push them out to your sales team when they are ready to be converted. Well, nothing is automatic, as you need to create and put in place a robust communication plan and content strategy that aligns with your brand’s value proposition.
As it relates to trade show investments… you can still plan to attend shows when it’s safe, and when you have something you want thousands of people to see and hear. Just don’t make this your major engagement investment. For us at Interrupt, we lean towards optimizing your investments to first identify your ideal customer, then pinpoint exactly what it will take to achieve your business goals with those customers. That’s why many of our clients are taking the vast majority of their trade show dollars and instead investing in building a more robust understanding of their ideal customers and executing hyper-targeted engagement plans with those customers.
Contact us at firstname.lastname@example.org if you’re interested in building a stronger brand by more deeply engaging with your ideal customers.