Creating an accurate trade show budget that allows you to achieve forecasted ROI takes a bit of practice and experience. It's easy to overlook small expenditures that can quickly erode your budget forecast. In addition, unexpected costs often surface on-site due to shipping damages or a forgotten item (our Checklist for a Successful Trade Show is a helpful reminder resource). This is part of the trade show package. You have to anticipate it. Further complicating the process is the time-consuming and number-crunching that is predicting lead levels and conversions via historical data. Very tricky.
Set Realistic Fact-Based Goals
To start, your sales and marketing teams set show goals by collaborating with each other. If the sales team needs to generate 200 leads to meet established sales goals, how much money do they need to make it happen? What will the marketing team need to do to help garner those leads? Banners? Brochures? Cocktail parties? What does your budget cover? Is it enough?
Average trade show statistics show the cost of a lead vary widely. Studies have been conducted showing ranges from $96 cost per lead (Center for Exhibition Industry Research) to $1,000 cost per lead (a wildly inflated cost from Mitch Goddard, Account Executive, Billian's Healthdata).
Although industries vary, about a $175 cost per trade show lead is good for an initial planning figure. As you gather specific intelligence for your company and/or your industry, this number should be refined.
For example, if your sales team needs 200 leads at an average cost per lead of $175, your budget for the show including pre-show promotion, on-floor presence, booth materials cost, and show follow up, needs to be about $35,000. Is this possible?
Other Factors to Consider
At the end of this post is a list outlining general trade show expense categories. We encourage you to include them in your next trade show budget. If your company is a new exhibitor and you don't have past information to reference, call the trade show organizer and the trade show management company. They can give you approximate costs. Travel cost estimates can be found on websites such as Travelocity or Expedia. Multiply airfare and hotel room costs by the number of people your company is sending to the show.
Cost for lost productivity is calculated by multiplying an average wage per hour by the number of hours your team will be pulled away from their normal job responsibilities. For example, the average cost per hour for the staff working your booth might be $75 per hour. Three team members will be pulled away from their normal job responsibilities for four days, and they generally work eight hour days. The cost of lost productivity at the show will be $75 per hour times three people, at eight hours per day for a period of four days. The total cost of lost productivity is $7,200.
This is a tricky metric as working trade shows is often part of a person's job responsibilities and not truly an additional cost. The goal is to try to determine if ithe sho is cost effective for your company, or if expending those man-hours on an income-generating activity makes more sense..
In the end, an effective trade show budget is like any other effective budget. Expenses less than or equal to total cost per targeted lead number figure. It may take practice and time to learn how to develop an accurate budget. In the long run, it's worth the time.
The following is a list of common expenses you will need to total in order to create budget. If you have questions regarding making a trade show budget or booth design, please contact us at 888-777-0223 or visit our website: ace exhibits.com.
Trade Show Event Expenses
- Booth space cost
- Booth furnishings (flooring, furniture, plants, etc.)
- Lead capture solution
- A/V equipment
- Shipping charges
- Drayage (moving your exhibit from the dock to your booth space)
- Electricity/electrician
- WiFi costs
- Booth I&D (installation and dismantling)
- Clean-up
- Trade show security
Travel and Entertainment
- Airfares
- Hotel accommodations
- Meals
- Car rentals
- Client entertainment
- Miscellaneous expenses
Pre-Show Marketing/Promotional/Sales Collateral
- Promotional gift expenses
- Printed marketing collateral
- Pre-show marketing
- Other promotional expenses
Cost of Lost Productivity
- Time and salary of booth staff
- Other lost productivity costs
Slush Fund
- Unexpected costs
- Emergencies
