If you are responsible for determining your trade show budget, you have probably been asked at some point to justify the expense generated by your program. If not, consider yourself lucky! Sooner or later, you will be asked to justify your program's existence.

As exhibit costs increase and the number of shows and other marketing options increase, exhibitors are forced to make some hard decisions. What shows will continue to be on the schedule and which ones will be dropped? Will the show-slice of the marketing pie be larger or smaller?

By following some simple steps, you will be able to provide your management with justification for continued participation in trade show events.

Before we start let's look at some rather revealing and startling statistics published by the Center For Exhibition Industry Research ( CEIR):

• 85% of companies say they go to shows to generate sales leads.
• 75% of companies measure show success by number of leads generated.
• However, 80% of leads generated are never followed.
• Only 25% of companies use ROI as a measure of performance.

Now you can begin:

1. Lead followup and tracking. This is basic. If you don't know how much business was generated from a particular event, you can't begin to justify the cost. Once you know the number of leads you have generated, you can begin to establish a value for them.

2. Now let's consider the expense of the event. What were expenditures for: Space, exhibit, shipping, outside labor, staff time, travel and related expenses, marketing and promotion, lead processing and tracking, and direct sales cost after the event? Some charges, such as exhibit and marketing expenses, can be amortized over a longer time period. Others are a one-time cost.

3. By dividing the cost of the show by the number of leads, you will be able to establish a cost per lead. Examine this figure in terms of what it costs to generate a lead through non-show channels. A good question to ask is "How long would it take me to generate X- number of leads if I didn't participate in a show? What would my cost per lead be?" I am sure you will find that generating leads at shows is considerably more cost effective. Another factor to consider is the selling cycle of leads generated in both shows and non-shows. If your normal cycle is six months for non-show leads, then you should use the same period to measure show leads.

4. All leads need to be entered into a database. You may create your own system or take advantage of several that are already on the market: Act, Access, Now contact, etc. This will allow you to track what happens to the lead throughout its life. How was it followed, who followed it, what were the results, is it alive or dead? Once you have done this, you can put a dollar value on the business transacted as a result of the event.

5. There is residual value in addition to direct income. What is the public relations value derived from being in a trade event? Was your standing in the industry enhanced by your presence? Were you able to generate any business from other exhibitors? Were you able to obtain any competitive information that you would not have gotten had you not participated in the show? How much business did you write with existing customers? Once you have taken these factors into consideration, you can justify your show program.

Good Luck.