The coronavirus pandemic is resulting in trade fairs and similar B2B events being cancelled worldwide. A recommended alternative is digital customer acquisition via online marketing. And this tool is not only beneficial in times of crises – as the following comparison shows.
Online marketing – more intense digital contact with customers
Modern customer acquisition without digital channels is unthinkable today. Most companies know this, which is why they use social media platforms such as Facebook, LinkedIn and Instagram for their marketing mix. Ads, too, are being broadcast more and more often on the Internet, for instance via providers like Google Ads. Just as frequent within the digital marketing blender: retargeting measures, which identify website visitors, follow them virtually and address them individual with advertising.
Nonetheless, this development is just taking off, which can be seen in the AUMA Trade Show Trends 2020. According to this survey, German businesses will be investing about half (48 per cent) of their B2B marketing budget in trade fair appearances over the next two years, which is just as much as in 2018 and 2019. In light of digitalisation, this focus on traditional trade fairs seems a little out of date.
Especially considering that more and more B2B decision-makers are from the millennials group. They largely communicate digitally and gather information via WhatsApp, YouTube or even Instagram. When it comes to business matters, they tap into networks like LinkedIn and XING. Instead of reaching out via phone, they collect information almost solely via smartphone or tablet. And they expect their business partners to also behave in a similar way.
If you want to reach this continuously growing target group, you need a digital strategy for winning over customers and keeping them. This does not necessarily make a trade fair superfluous; it does, however, lower its importance. Despite that, such events tie up lots of capital. This can be seen in the anticipated losses due to the coronavirus pandemic. The Institute of the German Trade Fair Industry at AUMA calculated that the overall German economy can reckon with losses of up to 5.6 billion euros due to the pandemic-related cancellations of trade fairs (as of 18 March 2020).
This money would have been better put to use in online marketing. With each euro invested here, a significantly larger circle of customers can be reached, for instance via digital contact points which are also active round the clock. And in the area of online marketing, there is still room for improvement. According to a survey by the German Association for Industrial Communication (bvik) from the year 2018 on B2B marketing budgets, the share of online advertising was merely 9 per cent. The largest share of the marketing budget was given to trade shows and customer events, at 37 per cent.
The most significant benefits of online marketing
Communicating digitally means, above all, communicating faster. Novelties about brands and products can be immediately pushed. Using a diverse range of channels, companies can reach various target groups virtually at one go. Other advantages of online marketing:
- Success can be directly measured. Marketers can count the number of clicks, conversions and other activities at any time, can document and analyse them. The ROI (return on investment) is noticed more quickly.
- Customer communication takes place on a broader basis, as online marketing has the potential to reach more B2B decision-makers.
- Campaigns which do not immediately have their desired success can be adjusted at short notice and fine-tuned.
- The budget invested can quickly be diverted to other projects or channels, for instance to optimise target group communication.
The fact that the significance of digital marketing is growing can be seen in the latest study by the Boston Consulting Group (BCG). A central result: advertisers with first-class digital marketing achieve sales that are two and a half times higher compared to companies that do not have a data-driven marketing strategy. What’s more, the CPA (cost per action) is nearly 40 per cent lower.
The most significant benefits of trade fairs
Companies do not stick with trade shows merely for nostalgic reasons. Today, as in the past, such shows are warranted. A very decisive plus is the personal contact between the exhibitor and the visitor. The direct dialogue offers a huge chance to approach customers and convince them. Additional benefits of trade fairs:
- The immediate presentation ideally showcases the use and benefits of goods or services. This is largely due to the face that a product can be touched and experienced. The interested persons can try out what they see.
- A trade fair allows the customer to test the goods on site – without any obligation to purchase.
- Only members of the target group are generally at trade fairs. This results in a very low scatter loss when communicating to and acquiring potential customers.
- Networking is an important aspect of trade fairs for many companies.
Best Practice: When online marketing beats trade shows
Automation specialist Balluff: virtual trade shows in times of corona
Many B2B companies want to continue to enjoy in-person trade shows despite the many advantages of online marketing. But during the coronavirus pandemic, large-scale events are not permitted. Therefore, trade shows have to be ruled out as a marketing channel for an indefinite amount of time. The automation specialist Balluff reacted quickly to this unfortunate situation and launched a virtual trade show at the end of April 2020 via an online event platform. Here is where product novelties and solution approaches for the Industrial Internet of Things (IIoT) were showcased.
Under the banner Challenge: Productivity, more than 25 experts presented innovations during live talks, keynotes and user sessions, and they highlighted the latest topics centred round IIoT. From industrial image processing, software solutions and automatic identification of tools to condition-based maintenance and approaches for IIoT – numerous topics were on the agenda of this two-day event. Many digital features, live streams and interactive elements came into play. The virtual trade show was broadcasted from a specially set-up studio at Balluff’s headquarters in Neuhausen, Germany.
And the event was widely accepted: more than 3,000 people signed, and at peak times, over 500 of them “attended” individual presentations at the same time.
Trade fairs vs. Online marketing
There’s no doubt about it: companies can showcase themselves well at trade fairs. But when it comes to value for money, as well as the opportunities for flexible use and design, online marketing scores bigger. This should be taken into consideration when divvying up the marketing budget. Especially keeping in mind that the target group will be using digital channels for purchasing decisions even more in future. B2B enterprises have to play their cards where their customers are. And their customers are informing themselves via smartphone more and more often than at trade fair grounds.