Tariffs And Trade Wars Can Have Major Ramifications On Exhibition Industry

Around 70 exhibition centres between North Sea and Lake Constance make Germany a unique trade fair destination worldwide. National, international and regional trade fairs in Germany attract over 235,000 exhibiting companies and 16 million visitors

The Exhibitions & Conferences Alliance (ECA), an advocacy group for the face-to-face business events industry will be closely following the Trump Administration’s trade policy.

Donald Trump has been outspoken around his interest in resetting the international trade environment by using both tariffs and non-tariff barriers to ensure that more goods are produced in the United States. But that also has a detrimental impact of making goods that come in from abroad much more costly.

According to an AUMA survey of the highest-ranking people responsible for marketing in 400 companies, trade fairs are the second most important marketing instruments - after their own website.

A year ago, 71 per cent of exhibiting companies planned to keep the number of trade fair participation constant, whereas this figure currently stands at 57 per cent. At the same time, around 21 per cent of those surveyed are planning more trade fair appearances - last year this figure was just under 15 per cent.

Large companies with more than 250 employees are planning an average of more than seven trade fair participations in Germany this year and next, while companies with up to 250 employees are planning less than five trade fair appearances.

Economic uncertainties and generally rising costs are key challenges for future trade fair participation.

Jörn Holtmeier, Managing Director of the Association of the German Trade Fair Industry (AUMA), says, “In these difficult economic times, four out of five companies are specifically focussing on increasing their participation in trade fairs. As a meeting place, trading centre and stage for the industries, trade fairs remain a mirror of overall economic development. Germany has recently lost some of its international competitiveness. High energy prices, rising non-wage labour costs and unfavorable tax policies in regards to international competition have reduced the attractiveness of Germany as a business location. The trade fair industry is feeling the increasing reluctance of domestic companies. It is time for the next federal government to decisively improve the conditions for business locations.”

The survey also shows that artificial intelligence (AI) plays a prominent role for exhibiting companies when organising their next trade fair participation. Around 48 per cent rate AI as crucial for upcoming trade fair appearances. Large companies and companies focusing on trade and services are particularly keen on AI. Exhibiting companies with a turnover of over 125 million euros push AI significantly more than smaller companies with a turnover of up to 2.5 million euros. This shows that AI plays a role in broader and more complex marketing and sales strategies.

Virtual reality or the Internet of Things (IoT) follows at a distance, while robotics and metaverse have low priority.

The AUMA Exhibitor Outlook also shows a stable development of trade fair budgets in companies. Exhibitors at trade fairs focusing on consumer goods show a strong willingness to increase their spending, while companies from the service sector are planning more conservatively.

Compared to previous years, the share of the trade fair budget in the overall marketing budget has risen from 38 per cent (2022/2023) to 45 per cent (2023/2024), thereby reaching the pre-pandemic levels. However, a significant proportion of the companies surveyed (29 per cent) were not able to provide a precise figure for this season, as budgets are being set at increasingly short notice - a further indication of the economic uncertainties these days.

Up to 230,000 jobs are secured by trade fairs in Germany. No fewer than 70 exhibition centres between the North Sea and Lake Constance make Germany a unique trade fair destination worldwide. Two thirds of all leading trade fairs in the global economy take place here. At peak times, international, national and regional trade fairs in Germany attract over 235,000 exhibiting companies and 16 million visitors. On average, 60 per cent of exhibitors and 35 per cent of trade visitors at all leading trade fairs come from abroad.

International Association of Exhibitions and Events (IAEE) President and CEO Marsha Flanagan, says, “As part of ECA, we are closely monitoring possible impacts of new tariffs on exhibitions. These new tariffs are poised to introduce several challenges which could include increased costs to our ecosystem, supply chain disruptions, potential declines in international participation and economic uncertainty. Given the fluidity of the situation, we will continue to assess its progress and support industry stakeholders in navigating these challenges.”