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German Trade Shows Headed for Slugfest

Published March 29, 2009

TAIPEI, Taiwan (BRAIN)—Executives at Eurobike and Bike Expo, a new German trade show in Munich, tiptoe around the phrase “trade show war.” But Messe Friedrichshafen and Messe München appear headed for a toe-to-toe slugfest over the world’s leading trade show—Eurobike.

Eurobike attracts scores of overseas buyers, exhibitors and thousands of European retailers and consumers. They all descend on Friedrichshafen, and the towns ringing southern Germany’s Lake Constance, during a four-day run the first week of September.

Munich has long coveted a toe-hold in the industry and, in the past, had launched an unsuccessful show. But when IFMA shut down its Cologne show last year, executives at the Munich convention center saw an opening—scheduling Bike Expo for July 23-26 and scrapping plans for a 2010 introduction.

Munich organizers then upped the ante when they snagged the support of Z.E.G., Germany’s largest retail cooperative with about 1,000 members. The buying group controls more than $2 billion in purchases and is a powerhouse in German retail.

Eurobike and Z.E.G. executives had met to discuss Z.E.G.’s involvement at Eurobike, but those talks collapsed and Z.E.G.’s chairman, Georg Honkomp, threw the cooperative’s retail muscle behind Munich.

Z.E.G. had long supported IFMA, giving the troubled show some much-needed luster. But IFMA failed to attract brand-name exhibitors. Instead, many exhibitors were from India, China and other low-cost manufacturing nations, making it attractive to mass-market and big box sporting goods dealers but not specialty retail. Bike Expo will most likely attract similar vendors.

Munich’s new show, however, is meeting with skepticism from an industry concerned about cost. Exhibitors, who must attend because of the buying group’s influence, worry that the show’s dates are too early, hitting German retailers at the heart of their selling season.

Exhibitors already had trimmed their budgets after IFMA closed, and were critical of Munich’s hasty decision given the tough global economy. But Munich officials dispute that. “The final decision was made in January after very deep discussions with the industry,” said Markus Hefter, Bike Expo’s project manager.

But suppliers doing business with Z.E.G. are reluctant to criticize the buying group’s decision. Since Z.E.G. requires its retail members to attend, most exhibitors will pay €120 or $163 per square meter to exhibit, the same price Eurobike charges.

“That’s just what I needed, another trade show,” lamented one supplier whose products are prominently displayed in Z.E.G.’s catalog. “We’ll exhibit but it will be in as small a booth as we can get, with as few people as we can get away with,” he said. He also exhibits at Eurobike and Interbike.

Still, Munich is gambling that over five years it could become a major show and that could pose a threat to Eurobike’s 20-year reign. Eurobike’s project manager, Stefan Reisinger, said, “to us, it looks like they are trying to get something started; for sure that’s their long-term plan.” Another source described Munich’s decision as “the biggest threat” Eurobike has ever faced.

Eurobike officials had offered Z.E.G.’s Honkomp off-site space arrangements as well as other options similar to its former agreement with IFMA. “In the end it was Z.E.G.’s decision to go to Bike Expo,” Reisinger said. “It (Bike Expo) is very similar to IFMA and the setup they had in Cologne,” he added.

Behind the scenes, the real issue is tax revenue. And a potential clash over trade shows pits the two communities against each other. Friedrichshafen and Munich own the convention centers and the shows that exhibit in them. Both cities need to fill hotels, restaurants and tourist attractions to generate tax revenue to maintain its facilities and pay its employees.

Also fueling the issue is Munich’s close proximity to Friedrichshafen—about 200 kilometers (120 miles) or a two-hour drive.

Friedrichshafen, a city of 58,000 and home to the Zeppelin Museum, is surrounded by farms and is a summer vacation spot, but business slows dramatically in the winter. To keep local businesses profitable and pay its convention center staff year-round, Friedrichshafen relies on its roster of trade shows.

Munich, on the other hand, is the capital of Bavaria with a population of 1.4 million. It has an international airport, hosts hundreds of thousands of tourists annually, especially during Oktoberfest, and has a highly diversified economy.

While Eurobike has wide support within the industry, as well as extraordinary brand caché, the show faces issues that Munich seeks to capitalize on.

Finding hotel rooms near Messe Friedrichshafen is a challenge and some exhibitors, retailers and others stay an hour away by car. A new hotel will open this summer and more are planned.

Highways and roads leading to the expo are jammed with traffic in the morning, especially opening day.
While Friedrichshafen has an airport, flights are limited to local routes. International visitors use airports at Zurich or Munich and then drive or take a train to the show. Some fly to Frankfurt and then on to Friedrichshafen.

While Bike Expo’s Hefter heaps praise on the quality of Eurobike, he refers to it as primarily a “mountain bike” show, a characterization that no longer applies. Eurobike had long since morphed from its role as a mountain bike show to a well-rounded exhibition of premium-brand road, mountain, trekking and urban bikes.

Bike Expo isn’t targeting Eurobike, Hefter said. Instead it’s creating a new event that offers retailers two days of business and consumers two days of play. Hefter also has a five-year plan and a budget to back Bike Expo.

Hefter, along with Manfred Wutzlhofer, Messe München’s chairman and CEO, came to Taipei to pitch the show to Taiwanese manufacturers and suppliers. Wutzlhofer’s presence at the Taipei Cycle Show signaled the industry that Munich is serious.

“We know the preparation time is very short,” Wutzlhofer said. And addressing the issue of timing, Wutzlhofer pointed out that there are no dates everyone in the industry would agree upon.

He characterized Bike Expo as a “new” concept with its focus on urban mobility and its two days of consumer activities. But he and Hefter also pushed Munich’s convenience for exhibitors—a clear shot at Friedrichshafen—noting that:

-The exhibition center has 16 air-conditioned halls with easy access for trucks and service providers.

-More than 55,000 hotel beds in the greater Munich area with 60 percent of them in the low to mid price range.

-The center is 20 minutes from Germany’s second largest airport and it offers 18,000 parking spaces nearby.

-It’s 15 minutes by rail from the city center and has direct underground subway facilities.

Munich is heavily marketing the show and has launched a Web site as well as a Web site in Chinese. “There are new megatrends in the industry and that calls for a new, independent and strong platform,” Wutzlhofer said.

—Marc Sani

Topics associated with this article: Tradeshows and conferences

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