Convention Center Follies. Heywood T. Sanders
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Consultant C. H. Johnson routinely employed the overall Data Book totals to describe demand growth during the 1990s. The HVS firm has used the same Data Book annual counts to describe demand growth from 1989 to 2007 in its consultant reports and its “Convention Centers: Is the Industry Overbuilt?” analysis in 2008. The “Overbuilt” article described exhibition events as growing from 3,289 in 1989 to 5,036 in 2007, “an annual average growth rate of approximately 2.4 percent … over the past 18 years.”49 These analyses, and others based on the Data Book event totals, unfortunately combine two very different kinds of events—conventions/tradeshows and local public or consumer shows—to create a misleading impression of growth. The reality is that the local public show category has provided effectively all the growth in annual event counts seen over the last decade and a half.
Tradeshow Week began publishing separate counts of local public shows in the 1994 edition of the Data Book. That year, the public events made up about 11 percent of the total. By 1999, public events comprised over 15 percent, and that proportion grew to 25 percent by 2007, continuing at that share through 2010. There is no indication in the Data Books if the growth in these public events reflected real change in numbers, or a greater effectiveness on the part of the volume’s editors in listing consumer events.
Limiting an analysis of event growth to just conventions and tradeshows provides a very different image of demand change. In the first year the breakdown was available, 1994, there were 3,820 conventions and tradeshows. The total reached a peak of 4,016 in 2000—a modest level of growth. But it then fell to 3,648 in 2002 before increasing to a post-2000 peak of 3,850 in 2006. The 2009 event total came to 3,745. Then, reflecting the impact of recession, the 2010 total dropped to just 3,552—the lowest figure in the Data Book’s recent history.
The annual count of conventions and tradeshows has thus fluctuated with the national economy. Yet the “rebound” in convention and tradeshow demand described by consultants circa 2005 and 2006 did not match the peak year counts of the 1990s. There was certainly not the consistent growth described by C. H. Johnson or HVS. And the 2010 figure—the last year Tradeshow Week published before its demise—represented an unprecedented decline.
The “200”
Since the mid-1980s, Tradeshow Week has also compiled an annual listing of the 200 largest—in terms of exhibit space used—conventions and tradeshows in the U.S. The “200” listing is thus a changing annual group, one that by definition includes only those events that grow at a rate comparable to the largest events. The “200” listing includes both for-profit annual, biennial, and triennial tradeshows such as the now defunct COMDEX computer show, the annual Consumer Electronics Show, and the winter and summer New York International Gift Fairs, as well as annual association conventions, such as the meeting of the American Urological Association and the Chicago Dental Society annual meeting. Unlike the Data Book, it excludes public consumer shows. And it reflects actual event performance, unlike the Data Book’s pre-event estimates.
In terms of total annual exhibit space use, the “200” events grew regularly through the 1990s, from 51 million square feet in 1991 to a peak of 69.8 million in 2000. That pattern changed dramatically after 2000, with space use total falling to 61.9 million in 2003. Growth began again in 2004, with 63.6 million square feet in 2004, hitting a peak of 71.3 million in 2008. It was only in 2007 and 2008 that space usage exceeded (albeit slightly) the peak of 2000. But the recession had a dramatic impact on exhibit space use in 2009, plunging to just 58.6 million square feet—the smallest total since 1996, and a drop of 17.8 percent.
The “200” events, the largest and by definition among the most successful in the industry, would thus appear to follow the growth argument of industry consultants. But the real pattern of exhibit space use and growth has actually differed quite a bit across the “200” events. The single largest event, a changing annual example that often includes the biennial CONEXPO for construction equipment or the International Consumer Electronics Show (both in Las Vegas) has shown quite a dramatic increase in exhibit space use. In 1991, for example, the fall COMDEX spanned 1.14 million square feet. By 1999, the top event spanned 1.73 million square feet. And in 2008, the largest event (the CONEXPO) covered a total of over 2.2 million square feet.
But the dramatic growth of the single largest event was not necessarily mirrored by the more typical “200” event. The median “200” event grew much more slowly and less consistently in exhibit space use. That mid-sized event covered 195,500 square feet in 1991, hit 267,677 in 2000, dropped to 224,800 for 2002, and finally hit a post-2000 peak of 248,580 in 2007. Compared to the largest events, the mid-sized convention and tradeshows in the “200” grew only modestly during the 1990s, and had not returned to the 2000 peak by 2008.
A pattern of no consistent growth in space also marked the bottom of the “200.” The single smallest “200” event in 1991 covered 113,000 square feet, reaching 125,300 by 1995. The peak year for the smallest event came in 1999, at 148,700 square feet. But the smallest event to be included among the “200” never again reached that size. For 2008, the smallest event covered 125,000 square feet—unchanged from 1995. Had the overall convention and tradeshow industry been consistently expanding in exhibit space, the smallest event among the “200” should have grown steadily as well. The fact that it did not suggests that the growth in space use for the overall “200” was a product of the largest events, not the “200” as a whole.
The most recent results, for 2009, the last year of Tradeshow Week’s operation, add one final fillip to the oft-repeated claims of convention and tradeshow exhibit space growth. The largest event in 2009, the International Consumer Electronics Show (CES), spanned 1,711,403 square feet—a drop of 7.9 percent from 2008. And the impact of the recession was even more dramatic at the middle and bottom of the “200.” The median-sized event fell to 218,541 square feet, a drop of 10.5 percent, and the smallest fell from 125,000 in 2008 to just 95,000 in 2009—a drop of 24 percent.
The exhibit space use of the “200” events thus differs from the consistent year-over-year growth pattern regularly shown in consultant graphics and reports. Very large events have demonstrated significant growth since the early 1990s. But that growth has not been the norm, even within this select group of the largest annual conventions and tradeshows. The more common result has been slow and inconsistent growth from 2002, followed by the sharp plunge in 2009.
The growth of the largest events also reflects their location. Every year but one since 1991, the single largest event has been held in Las Vegas. And Las Vegas offers a uniquely abundant scale of convention center space. The publicly owned Las Vegas Convention Center expanded from one million square feet of space to two million in 2002. The triennial CONEXPO large construction equipment typically spilled out to the center’s surrounding parking lots and nearby hotels as well. And the Consumer Electronics Show has been able to take advantage of the million square feet of exhibit space at the privately owned Sands/Venetian Expo and exhibit space at the Hilton hotel in addition to the space at Las Vegas Convention Center. There has thus been a ready availability of new exhibit space in Las Vegas for events that could sell it.
The case for more, and newer, convention center space has not been built solely on the image of a growing demand for exhibit hall space. Industry consultants also argue that convention and tradeshow attendance has been growing as well, and thus a larger center will pay rewards in terms of more attendees and their economic impact. Indeed, if only space use was growing, cities would be seeing no added attendance—or greater visitor spending and economic impact—from building more center space. Yet for the “200” events over the past two decades, the pattern of total attendance has not been one of consistent growth. Instead, total “200” event attendance hit a peak in 1996—a peak that has not been equaled in the years since.
The “200” events grew in terms of attendance from 3.88 million in 1991 to a high of 5.08 million in 1996, propelled in large part by the growth of very large events, such as the COMDEX show. The Las Vegas-based COMDEX grew from about 127,000 attendees in 1991 to over 216,000 in 1996. But subsequent years saw the behemoth show’s attendance sink to under 125,000 in 2002 and 44,000 in 2003 before finally being canceled in 2004. Other big tradeshows shared a similar