Money Makers

Meetings & Conventions: Money Makers - July 1998 Current Issue
July 1998
Money Makers

6 ways to make your convention more profitable

BY DANA NIGRO

The association is floundering. Its members are balking at paying higher membership fees. Publication sales have dropped precipitously. And the costs of providing education and other services to its constituents keep going up. The situation is critical. Can the annual convention save the day?

For many associations, that's where the money is, with meetings and conventions bringing in more revenue than any other source aside from dues. According to the 1997 Association Operating Ratio Report produced by the American Society of Association Executives, associations collect an average of 24 percent of their total income from conventions, expositions and other educational programs. That figure breaks down to 8.9 percent from registration fees, 6.8 percent from exhibit fees and 8.4 percent from educational program fees.

But traditional registration and exhibit fees don't have to be the only source of available funds. Even if your convention is already bringing in the bucks, you can still strive to increase those numbers. And as your organization's dollars grow, you can offer members more services, programs and value overall. Here's how...

#1. One price does not fit all
That $500 fee for your event may look pretty steep to some attendees, even if it really is a great bargain. There may be a lot included in that price, but it's likely that not everyone wants the whole package.

"The old one-size-fits-all concept - here's the convention, here's the price, you all come - is no longer meeting [attendees'] needs," says Gary LaBranche, vice president of education and convention services for the American Society of Association Executives in Washington, D.C.

Planners need to provide price options that appeal to different segments of their membership. Breaking down the total registration fee - by day, by session, by making meals or evening events optional - may encourage more people to come. "Variable pricing can be seen as a revenue generator, even though it is driven more by the membership's needs," says LaBranche.

For its March 1999 annual convention in San Antonio, the American Pharmaceutical Association is creating a weekend pass for area pharmacists. "In addition to attracting the folks who fly in, we want to get the niche of people who have the opportunity to drive in for a portion of the meeting," says Windy Christner, director of meetings and expositions for the Washington, D.C.-based association. "There are a huge number of pharmacists in Texas. These people can drive in and spend the weekend with us and not have to take any time off of work."

The association is also offering an exhibit hall-only pass for people who aren't interested in attending the conference but want to find out about new products. Explains Christner, "Getting the money, even if they don't pay the full registration, is better than not getting it at all."

#2. Anything can be sponsored
Suppliers have always been a great source of support for the big things that associations couldn't provide on their own budget - the splashy opening night reception, high-profile speakers and the like. Now, it's time to think small.

Don't overlook any possible way companies can get their name or logo in front of your association's members. "Sponsorship has gotten much more sophisticated on both sides," says Nancy Green, vice president of education and special events for the Greater Washington Society of Association Executives. "I don't know what isn't sponsored these days - even the rope that holds the nametag around your neck."

The San Francisco-based American Academy of Ophthalmology has put together some new sponsorship options this year. "We are trying to add some convenience items to our meeting that would make it more pleasurable for attendees, but that we can't afford to do," explains Debra Rosencrance, CMP, vice president, meetings and exhibits. "Our meeting has grown; it's now 26,000 people."

Among the items the academy would like sponsors for: totebags for meeting materials, relaxation stations with massage chairs within the meeting facilities and a pocket guide that attendees can carry in lieu of the cumbersome 350-page final program.

The American Pharmaceutical Association now gets sponsors for shuttle bus service; sponsors' names are featured prominently in the advertising space on the sides of the vehicles. For its most recent meeting in Miami, the organization also distributed commemorative conference pins featuring a local scene. The pins were attached to a card with the sponsor's name and a message saying that if they dropped the card off at its exhibit booth they would be entered in a prize drawing. Attendees ended up with a nice momento, and the happy sponsor got a lot more booth traffic. For the 1999 meeting, Christner is proposing some ideas new to her group. The association drops off its on-site convention daily at attendees' hotel room doors. "A sponsor could put a band around it to promote their booth and save us the cost of delivery," she suggests. She also would like to establish rest areas in the exhibit hall showing CNN news clips to keep people informed about world activities even while they're immersed in the show. Those news clips could be interspersed with sponsors' ads.

And Christner wants to provide voice directionals at the convention center, since "it's pretty confusing for the first couple of times that you go there." Speakers set up at various points would play a continuous loop tape that provides directions to major points and to upcoming sessions. The tape could incorporate informational blurbs about the sponsors.

#3. Tack on specialized education
Many organizations are attaching a premium day at the beginning or end of their conference for extra training. Says ASAE's LaBranche, more associations are "extending the learning experience."

The Mississippi Association of Realtors in Brandon, for one, has begun offering a technology track separate from the continuing education included in the registration package. People pay an additional fee to take hands-on computer classes to keep them up-to-date. "We do it on the first day of the conference schedule to encourage members to come in early so they'll be present for the entire convention," says Katie Bodiford, director of member services/meeting planner.

Condensed versions of conferences offered at other times during the year can be a way for some groups to lure participants who skipped their big meeting. "There's a trend toward more segmentation," elaborates GWSAE's Green. "People want programs that are very specialized to their needs. There are more programs for smaller and smaller audiences."

GWSAE, a regional association for the D.C. area, is now holding mini-trade shows, selling 5 to 10 exhibit booths around very specialized topics. "We'll offer two educational programs in an area like finance, and then try to pick out the best informational vendors to partner with," says Green. "We are creating new kinds of bite-size packages so not everyone has to fit into our annual meeting."

#4. Sell educational programs
Like some of the associations mentioned above, the American Academy of Ophthalmology offers subspecialty programs that start a day or two before its annual meeting. In this case, the academy has partnered with several related associations - the American Glaucoma Society, Retina Society, Macula Society, Vitreous Society and the Club Jules Gonin Society. "They create the programs each year. We have them do it because they are the leaders of their subspecialties," says planner Debra Rosencrance.

For the majority of the academy's attendees, registration is included in their membership. So these pre- meeting programs, for which participants pay a separate registration fee, are a way for the academy to generate more revenue. Its partners, in turn, receive a royalty - a percentage of the registration fees - for developing the programs. They then can use the extra funds for research or other projects.

The American Pharmaceutical Association is looking into licensing some of its educational programs to its state pharmacy association affiliates, which would then be able to use the programs at their own local meetings. The association has already been selling a basic pharmaceutical skills program to 18 of its 50 affiliates for about three years, but hopes to expand the offerings to include five additional disease management programs by early next year. "We are trying to determine what's the best arrangement so our costs are covered and we make a small profit that we can use to update the materials," explains Elizabeth Keyes, director of education.

Two years ago, the association also started selling programming to outside companies. The education department will develop videotelecasts for chain pharmacies; the programs are broadcast over the companies' in-house satellite networks to anywhere from several hundred to several thousand pharmacists. Last year, the association created one program; this year, it will produce four. "The goal is to generate extra revenue that we can put into other programs," says Keyes.

#5. Promote distance learning
Associations have been in the business of distance learning since the days of correspondence courses. Then they branched out into selling audiotapes and videotapes. Now, new technology is opening up opportunities to bring the kind of education normally available only at conferences to members who might otherwise not plunk down the registration fee.

Associations have begun using satellite broadcasting, videoconferencing, audioconferencing and the Internet to deliver their programs. "The kinds of technology available today give fantastically increased access and interactivity and sense of community to learners dispersed throughout the country or the world," says LaBranche of ASAE, which recently started an Internet-based education program.

DesktopASAE offers 13 different online courses. Eleven of them, which are three hours in duration and can be taken any time of the day from anywhere in the world, are priced at only $35. The highest-priced course is $395 for an eight-week, instructor-mediated program. "Not only is it a competitive price, you don't have the travel costs," says LaBranche. "When you compare it to face-to-face education, it is, generally speaking, a bargain." In the first two months after DesktopASAE's rollout, about 100 students participated.

The American Society of Landscape Architects in Washington, D.C., has been pleased with the early results of another form of distance education - interactive audioconferencing. Its first program was conducted in March of this year, and it has put on three others in the first three months. Aside from cutting down on travel costs, the audioconferences save participants money because they are registered as a conference site. "For the one-time fee [$129 for members], they can have as many people as they want in their office listen in on speakerphone," explains James Tolliver, director of continuing education. "It offers economy of scale." At the same time, it's highly interactive. Listeners can ask questions of the speaker, and all the participants hear the question and the response.

The topics the audioconferences cover are essentially the same as those the association presents in its face-to- face seminars. (The course is constructed differently, since the subject is a very visual medium, and every participant receives handouts in the mail.)

"We realize that not everyone can afford the time and expense of going to a central location each year," comments Tolliver. "One of the objectives was not only to expand the learning opportunities for our members and the profession but also to enhance our non-dues revenue and use that to build our education program."

Tolliver also hopes the programs may bring in some new members. Aside from marketing to its existing audience, the association targets affiliated groups and people in related professions, such as architects, planners and real estate developers. The association is a registered education provider with the American Institute of Architects, so it markets its program to AIA's national membership by posting its offerings on the group's Web site.

The association has had an "enormously positive response" from participants, says Tolliver. "We do evaluations after each one. On a scale of one to five, our lowest rating was 3.8 for the first program and the highest was 4.6. That's pretty widespread acceptance as far as distance learning goes."

# 6. Create virtual trade shows
Technology has also opened up a whole new way of charging exhibit fees - electronic expositions. LaBranche estimates about 10 percent of associations are currently experimenting with virtual shows, and that number is rapidly growing. Virtual shows can take place in conjunction with an existing show or they can be staged independently.

For the second year in a row, the Produce Marketing Association, based in Newark, Del., has created a virtual trade show in conjunction with its annual convention. Companies who purchase exhibit booth space at the convention are listed free on a Web site created specifically for the show. If exhibitors want to put up more detailed information to lure attendees to their booth, they may purchase an ad on the site. The association charges different levels of fees for everything from a one-page link of basic text to fancy links with multiple pages and video clips.

"The [exhibitors] who are doing it are very enthusiastic about it," says Patricia Quinlan, the Produce Marketing Association's director of conventions and meetings. "It's taking time to catch on, but we see an increase already from last year. We expect it to increase as more people become accustomed to doing business over the Web."

The trade show site (www.pma tradeshow.com), which was introduced this spring for the group's upcoming October convention, is updated frequently as new exhibitors sign on. It includes searchable company listings, colorful logos to highlight those with ads, and the trade show floor plan for the convention. The site also is linked to the convention schedule and program topics, registration and housing for the event, detailed information about exhibiting and the association's home page. This encourages visitors to the site to sign up for the show right away.

As an added bonus for the association, the virtual show has boosted interest in the live convention, particularly from international attendees. Knowing in advance which companies will be exhibiting makes it much easier for potential participants to decide to make the trip, according to Quinlan. In 1996, the group's total international attendance numbered 1,311 people. In 1997, the year the association instituted the virtual show, international attendance jumped to 1,871 - almost a 43 percent increase. Although that wasn't the main objective of the initiative, collecting those additional 560 registration fees certainly didn't hurt.

Trade show turf war "We're not accusing anybody of anything." Many for-profit, independent show operators are starting to take a closer look at the activities of their counterparts in the nonprofit, tax-exempt association sector - and seeing what they consider to be unfair competition.

Most association trade shows are tax-exempt as long as the show is part of a meeting that promotes the association's industry and/or contains an educational component. But insiders say an increasing number of associations are stepping beyond the tax code to manage or buy the shows of other nonprofits.

Are associations moving en masse onto independent producers' turf? Robert Harar, chairman of the Framingham, Mass.-based Society of Independent Show Organizers, set out to find the answer. Harar sent out a letter in late March to 15 trade show industry associations - including the American Society of Association Executives, the Professional Convention Management Association and the International Association for Exposition Management.

Harar's letter stated that the competition between independent producers and the associations "appears to be a growing concern throughout the exhibition industry." The letter went on to note that some associations have been "acting as show management companies for shows other than their own," as well as "acquiring other shows." Harar's goal is to find out how extensive these practices are. "We're not accusing anybody of anything," he adds. "We're just curious."

As of press time, about a half-dozen associations had responded "very openly" to the letter, according to Harar. "Probably, our next step will be to survey our own membership," he said. "We would also like to get together with the other industry associations and have a roundtable on the subject." DAVID GHITELMAN