According to a recent report from the Center for Exhibition Industry Research (CEIR), the exhibition industry should return to operating at its pre-pandemic status in just over a year. The name of that research document is the 2021 CEIR Index Report.
Cathy Breden, the CEO of CEIR, says, “With more vaccine mandates and safety measures implemented at large gatherings, and with a majority of the population vaccinated, the recovery of B2B exhibitions should begin by the fourth quarter of this year and gain momentum in 2022.”
What is the CEIR Index Report?
In Sept. 2021, the Center for Exhibition Industry Research released its 2021 CEIR Index Report, an annual analysis of the B2B exhibition industry. The report uses data collected directly from exhibition organizers to provide “an objective measure of the annual performance of the exhibition industry” and “an economic and exhibition industry forecast for the next three years.”
The CEIR Index Report uses four key metrics to measure year-over-year changes and determine the overall annual performance of the exhibition industry: net square feet (NSF) of exhibit space sold, professional attendance, number of exhibiting companies, and gross revenue. Using this data, it forecasts three possible paths for the exhibition industry over the next three years.
What Does the Future Hold?
In the worst-case scenario, the COVID-19 pandemic persists due to the delta variant or a new, highly contagious variant. Should this occur, the exhibition industry will not completely return to form until 2024. However, there is only a 30% probability of this scenario happening.
The best-case scenario relies on a rise in vaccination rates. Should this play out, the trade show industry will make a full recovery by mid-2022. However, the report places the odds of this scenario at 10%.
The most likely scenario sees vaccination rates remaining steady and cancellations of trade shows and conferences declining through the remainder of 2021 and into 2022. As more live events occur, the industry will fully recover by 2023. The report states there’s a 60% chance of this playing out.
“In the baseline scenario, the impact of COVID-19 diminishes, and the exhibition industry should see a dramatic rebound in 2022, exceeding 100% year-over-year increases in all 14 sectors, albeit from a low base in 2021,” Dr. Allen Shaw, Chief Economist for Global Economic Consulting Associates, Inc., is quoted in a press release. “By the end of 2023, the exhibition industry is expected to fully recover. Nonetheless, performance by sector will diverge depending on its secular (long-term) trends and underlying macroeconomic conditions.”
A Further Look
The CEIR Index Report provides a specific analysis of 14 industry sectors:
- Business Services (BZ)
- Consumer Goods and Services (CG)
- Discretionary Consumer Goods and Services (CS)
- Education (ED)
- Food (FD)
- Financial, Legal, and Real Estate (FN)
- Government (GV)
- Building, Construction, Home, and Repair (HM)
- Industrial/Heavy Machinery and Finished Business Inputs (ID)
- Communications and Information Technology (IT)
- Medical and Health Care (MD)
- Raw Materials and Science (RM)
- Sporting Goods, Travel, and Entertainment (ST)
- Transportation (TX)
The analysis believes that three of these sectors will lead the recovery: discretionary consumer goods and services (CS), food (FD), and industrial/heavy machinery and finished business inputs (ID). However, it also predicts that four sectors will lag in returning to the pre-pandemic level: business services (BZ), consumer goods and services (CG), education (ED), and raw materials and science (RM).
“The past 20 months have been a real struggle for the exhibition industry, and there remains a great deal of uncertainty,” Breden notes in the same press release. “Exhibition organizers have demonstrated through health and safety measures that our events can be safely held. It is through data gathered for the Index that CEIR is able to generate economic impact figures related to the U.S. GDP. This economic impact of the exhibition industry is important for telling our story on the effect of shows to the U.S. economy.”
Reasons for Optimism
The report bases its general optimism on several factors. First, the U.S. economy showed improvement compared to the second quarter of 2019 and even more significant improvement compared to the first quarter of 2021. This progress is due to increases in personal consumption expenditures, nonresidential fixed investments, exports, and state and local government spending.
Second, the exhibition industry showed significant advances during the second quarter of 2021. Specifically, the cancellation rates of physical events dropped to 66.5%, which may seem high, but it’s down from 90.4% in the first quarter of 2021. When analyzing the events that did occur, all exhibition metrics for the second quarter of 2021 improved from the first quarter. CEIR believes these positive trends will continue, and cancellation rates will drop dramatically.
Third, vaccination rates are expected to remain steady or rise due to recent vaccine mandates for federal workers, health care staff, and employers with 100 or more employees. That’s in addition to many venues and live events enforcing health and safety measures and requiring proof of vaccinations or negative COVID-19 tests.
“Because of those new initiatives, economic activities should continue at a robust pace with real GDP growth at a seasonally adjusted annual rate of over 5% during the second half of the year, and the B2B exhibition cancellation rate should decline further,” said Dr. Shaw.
These findings are corroborated by another exhibition industry report, the recently released Global Recovery Insights 2021. This survey found that 72% of existing trade show attendees plan to attend trade fairs with the same or increased frequency as their pre-pandemic appearances, and 16% plan to attend much more frequently.
Another interesting finding from this report is that marketing decision-makers who did not attend trade shows before the pandemic are now committing to live events. The reason: during the pandemic, these marketers attended virtual industry events and became aware of their value. As in-person events return, this group intends to keep digital events as part of their marketing mix and begin exhibiting at the live editions.
These reports confirm what we have personally experienced: live events are returning stronger than ever. Ready to return to B2B trade shows (or attend your first brand experience)?