The 5 Biggest Pitfalls of Hosted Buyer Programs
Matchmaking of event participants is becoming more and more important to trade fairs and congresses, as no organizer wants to leave networking success purely up to chance. Hosted buyer programs can help – but they are not easy to devise and implement. What pitfalls should be avoided?
Trade show organizers that see themselves purely as space rental companies are under pressure. More and more exhibitors question the return-on-invest of their trade show participations. Therefore, it sounds like the ideal solution: an event organizer invites targeted visitors to a trade fair and covers flight and hotel costs. The visitor (or hosted buyer) is committed to completing a certain number of appointments with exhibitors at the trade fair.
Exhibitors then already know in advance who they will meet at the trade fair. The costs for the hosted buyer program a divided up amongst the participating program exhibitors. A win-win-win for all involved.
So where is the problem?
Particularly in Germany, some organizers are very critical towards hosted buyer programs, some would even go as far as to describe them as the “dinosaurs” of event formats. Still, the number of hosted buyer programs offered at international trade shows is constantly growing. It sounds pretty paradoxical to wave aside the benefits of hosted buyer programs, when you take into account the growing demand of exhibitors to justify their participation with solid figures and KPIs. If done “the right way”, hosted buyer programs can deliver those very KPIs (e.g. number and quality of contacts at a trade show).
Sometimes, hosted buyer programs are being accused of delivering “forced appointments” that neither side really wants. The reason for this often lies in inappropriate, home-grown software that wouldn’t allow turning down appointment requests or blocking slots for workshop or educational programs.
Origins in meeting and events industry
Ray Bloom, founder of the IMEX group, an event organizer for trade fairs and congresses in the MICE sector (Meetings, Incentives, Conventions, Events), is the inventor of the hosted buyer concept. There have been hosted buyer programs in the industry for a very long time, regardless of whether at IMEX, IBTM events or MPI WEC events (Meeting Professionals International).
Sallie Coventry, Portfolio Director, Meetings and Events at Reed Travel Exhibitions, describes the advantages for exhibitors in an Interview with PCMA: “The hosted buyer model guarantees that every participating exhibitor has appointments during the trade fair and can thereby calculate their investment “.
More and more consider hosted buyer programs as an entry into other industries, for example in the last few months at
- Alimentaria in Barcelona, Spain
- Domotex Asia / Chinafloor in Shanghai
- Food Expo Greece in Athens
- Global Cold Chain Expo in Chicago, USA
- R+T Asia in Shanghai, China
- Tupelo Furniture Market in Tupelo, USA
Hosted buyer programs are tempting as you can offer both exhibitors and visitors more added value. There are however several pitfalls to avoid – we’ll have a closer look at the five most important of these now.
1. How do visitors qualify for a hosted buyer program?
In most cases, the obvious criteria of who belongs to the potential hosted buyer circle and who doesn’t can be listed quite easily. This concerns
- their decision-making power in the company
- the purchase volume
- possibly particular, international target markets and industries
It is probably also manageable to integrate exhibitors into this process and to ask them who they would like to see in the hosted buyer category (as done e.g. at the Tupelo Furniture Show). However, the challenges already start there, as who wants to really disclose their leads and potential customers?
It gets particularly tricky then when determining who meets the criteria and who doesn’t. Is the purchaser from a large corporation that has a high purchase volume, but has only just made an initial investment a hosted buyer and should be invited?
He or she will probably not make another purchase in the short term. Determination therefore requires consideration of purchase intentions for the next 6-12 months (e.g. investment capital) and if the purchasers are visiting the trade fair to issue concrete contracts.
An event organizer should be able to fall back on a decision board or specialists in cases of doubt, as investments in each hosted buyer are considerable, especially when we are talking about international guests. The IMEX does this via a system of intermediaries.
How do I make sure no one sneaks into my hosted buyer program?
Not so easy…
2. What about scheduling?
It is more than typical at the IMEX or IBTM that a hosted buyer completes 8 or more different appointments with exhibitors per day. Hosted buyers commit to this when signing up to the program.
The decisive question is then how the appointments are distributed amongst the exhibitors. The requirements from both sides need to be considered. The Converve platform is perfectly suited for such a task, as it enables matchmaking according to interests – something of enormous importance for efficient scheduling, offering a mutual benefit to both sides.
Enough time should be scheduled for each individual appointment as well as for getting from one stand to the next. Alternatively, appointments can be held in a specially designed matchmaking area to keep distances short. Converve also offers software for planning such matchmaking areas and distributing networking tables and time slots.
3. How do I avoid spam as an event organizer?
One error particularly made by events in the MICE industry is to simply forward hosted buyer e-mail addresses to exhibitors. The result: an e-mail bombardment of hosted buyers leading up to the trade fair! This is exactly the reason why some decisions makers apparently don’t sign up to hosted buyer programs.
This requires a creative solution, regulating frequency and avoiding it becoming spam. This could be e.g. in that event organizers issue a hosted buyer newsletter, bundling the information of participating exhibitors. The Converve platform enables personalized mailings, newsletters and follow-up actions to be simply created and planned on one platform.
4. How do I separate the wheat from the chaff of stands?
Exhibitors need to remember in all the advantages of a hosted buyer program that there are of course still other attractive potential customers visiting the trade fair.
Michael Part, Sales Manager at Austria Center Vienna describes the negative results on the exhibitor’s side to tw: “The online diaries (referring to EIBTM) are full, the appointments are processed within 5 minutes due to mutual lack of interest and the ‘heavy-weights’ have to be found in the aisles or arrange something privately in advance.”
It therefore doesn’t help much if key people are tied up in the stand in hosted buyer meetings all day and are then not available for spontaneous high-caliber visits. Time and resource planning requires flexibility, especially for exhibitors.
5. How much organizational effort should I calculate?
An event organizer needs to clearly understand that the supervision of a hosted buyer program is a full-time job – surely not the whole year, but definitely in the last 3-4 run-up period to a trade fair. This includes
- designing the program at all: What belongs to this task? Which costs should be covered (fully-hosted, semi-hosted)? Which offers should/need to be completed by hosted buyers? What happens is a hosted buyer doesn’t meet the set obligations?
- defining watertight application criteria and processes (here an example from Alimentaria)
- designing application forms
- supervising the application process and clarifying queries
- booking flights and hotels
- organizing appointments with exhibitors
- keeping hosted buyers informed
- arranging bus transfers
- setting up and running a hosted buyer lounge
- possibly organizing evening events, pre or post-tours and catering
Pricing for participating exhibitors should consider all these costs (plus a profit margin for the event organizer), otherwise costs will be on top.
In a nutshell: Hosted buyer programs have a great future, provided that…
I am convinced that hosted buyer programs will have a great future and even replace classic trade show formats. Their reputation may be tarnished because sometimes, the execution was flawed. When you take into account some success factors, hosted buyer programs will deliver benefits to everyone involved:
- No forced appointments. Buyers and suppliers at the MPI/WEC hosted buyer programs could decide, which appointments they would accept or turn down. The program was hosted on the Converve platform from 2011 until 2015.
- Integration of the event program. The participants should be able to choose the slots when they want to take part in the educational program and, hence, would not be available for appointments.
- Strict selection and qualification of participants.
- Design conforming to compliance. You have to find solutions so that e.g. corporate planners at a MICE event will not be automatically excluded from such programs due to compliance regulations.
The Converve platform for matchmaking and networking is the market leader for the organization of hosted buyer programs. Through the platform, you can organize practically all aspects of the program – from communications, registration, qualification, payment, matchmaking, to processing on site and following up.
Would you like to find out more? Feel free to contact us and we’ll gladly advise you on hosted buyer program topics, based on our broad experience with many hosted buyer programs on a worldwide scale.
