We broker relationships between the buyer and the seller” is how Mike Rusbridge, chairman of Reed Exhibitions Worldwide, describes his job. His UK-based company is one of the world’s leading organizers of exhibitions, with a portfolio of more than 500 events. A member of the Reed Elsevier group, a global publisher and information provider, the $1.2 billion (about Rs4,800 crore) company has more than 2,600 employees working in 39 offices across the world, serving 47 industries. In 2007, Reed Exhibitions organized 460 business-to-business (B2B) events worldwide, seven of them in India.
Reed Exhibitions set up its offices in Gurgaon, adjoining Delhi, in January 2006, and has organized trade shows in Chennai, New Delhi, Mumbai and Hyderabad in the past two years. This year, it plans to hold seven shows in the country. The B2B exhibition industry in India is currently minuscule, but Rusbridge expects to see exponential growth in the segment. His firm plans to invest $50 million in its India operations over the next three years.
In an interview with Mint, Rusbridge talks about the exhibition industry in India, its effect on media and advertising, and the challenges his company faces in the country. Edited excerpts:
How does Reed Exhibitions operate? Is your India strategy any different?
We are looking at sectors where we already have skills, where we have a brand reputation. We take an idea, and if it works well in one part of the world and has a strong following and a strong reputation, we try and bring it to other parts of the world.
Roughly about 85-90% of our revenue is driven by sale of space. What a company (client) does is buy our ability to deliver an audience. They take space in our show on the promise that we’ll deliver an audience.
Mike Rusbridge/ Reed Exhibitions Worldwide
We own most of the events we run across the world. We come up with the idea, and take full responsibility for it. In India, we will identify the growing industry sectors. Then, we will marry the opportunity with our skills. For example, JCK is the largest (jewellery and gems) event in North America. And India has a thriving jewellery industry. So, we brought JCK to India, and it has been successful.
Most of the countries Reed Exhibitions operates in are developed economies. How does India fit into your global strategy?
You are right. A few years ago, only about 9% of our worldwide business was outside the developed areas. Today, it’s a little over 20%, and we aim to increase it to around 30%.
The reason is quite simple. If you look at the mature economies—Europe and America—they are growing at a slower rate. To grow faster, we need to get business from some of the emerging markets. So, in the past 3-5 years, we’ve been focusing a lot on countries such as India, China and Brazil. We are growing at 20-30% in these markets. This kind of growth can’t be achieved in markets such as France, the UK or the US.
What potential do you see for the exhibition industry in India?
It’s a young industry and that’s what appeals to us. When we look at where we want to be, we look at attractiveness and accessibility.
Attractiveness stems from the growth rate and the size of the economy. The other issue is accessibility, our ability to enter a market that we would want to. India is a relatively open market. Another issue is infrastructure. We are not just keen on bringing numbers of shows to a country. Instead, we look to work with relevant authorities and institutions to build new exhibition centres. Without centres, we can’t run shows.
From a marketing perspective, what unique opportunities do exhibitions offer?
Although we’re called exhibition organizers, we are intrinsically relationship brokers. We try and broker business relationships, between the buyer and the seller.
The other thing that is unique about exhibitions is that if you look at any other form of media, you can’t bring people together in an environment that is tailor-made, with all your products on display so that your target audience can touch and feel them.
Are you looking to expand your operations in India?
We’re running shows in Delhi, Chennai, Mumbai and Hyderabad. And we’ll have another office in Mumbai later this year. Over the next three years or so, we’ll invest about $50 million in India. We aim to hold about 20 shows every year. In 2008, we will have seven shows. So, we have an ambitious expansion plan. We have 30 employees in India, and plan to expand our team.
What challenges do you see for Reed Exhibitions in India?
One is obviously the quality and number of venues. We think India needs more shop windows because it gives people from all over the world the opportunity to meet, and try and do business and make relationships.
We see ourselves as facilitators; we don’t build facilities. But we are in discussions with developers, financiers, managers of cities. Reed Exhibitions can bring world-class events to India and that, for sure, is a big attraction for them. They see us as being a good anchor tenant.
The other challenge is how we market ourselves; finding our way to the people who we feel should be coming to our events. We are investing heavily in building high quality databases from scratch—people who should be interested in the event.
The most reliable way to get these people is one-to-one communications. That infrastructure isn’t there right now. There are no B2B trade publications and many of the newspapers are too broad; so what we’re doing is telephoning people, visiting companies... any way we can to get to particular individuals.
It’s very intensive and requires significant investment, and time and effort. That’s the main way we can get our exhibitions off the ground here. Clearly, over time, as direct mail and B2B publications and the media develop, our job will become easier.
What do you think are the future trends in this industry?
There’s going to be exponential growth, and the biggest constraint to that is, as I said, venues. When more venues are up and running, then exhibitions will fill the venues. The more the venues, the more the space, the faster the growth.
It’s a very exciting stage...a very early stage. And it’s going to increase very rapidly, driven by construction. We’ll see an exponential growth in the number of events—that will bring quality and standards as things begin to mature. In conjunction with that, we’ll see more B2B communications. Direct marketing is our only way to get hold of people and that will change as well. In the next 5-10 years, there will be very, very fast growth.
How will the exhibition industry affect the marketing and advertising business?
It’s an old-fashioned view that one develops at the expense of the other. Our view is that they are actually complementary.
A few years ago, lots of people were saying the exhibition industry was dead because of the Internet. We say the Internet benefits exhibitions. It has driven people back to face-to-face, especially if you look at the media. For example, as we start developing communities around exhibitions, usually it’s either a magazine enters the market first, followed by an exhibition, or an exhibition is followed by a magazine. It will build the B2B magazine publishing business as well.
There are other competitors coming to India. Do you think it will lead to a crowd of the market even before it matures?
Everyone is coming in. Any company looking for a faster growth will want to come to India. It is indeed going to get more competitive. That drives up standards, and given that we are working hard to try and set the standards, we’re up to the challenge.