Tobacco Industry Trade Exhibitions – the skinny

Who’s not helping the Tobacco Industry…?

Until recently we had one major exhibition in Europe every four years, TabExpo; then we had the announcement by WT that an additional event in Europe would be held.  The industry wants less events – or at least lower cost – so we now have the organizations in direct competition for the same business in the same month and year. Two European exhibitions (TR’s TabExpo in Prague & WT in Munich) are set for November 2011 – and just five days apart!

Both have scheduled events in India this year – one an exhibition the other a Networking Forum.

As market leader TR moves ahead with 50 or so confirmed exhibitors already for TabExpo Prague in 2011, it is largely ignoring WT who is left looking desperate in attempting to undermine the viability of Prague in favor of Munich.

Why is this?

The stark reality is the Tobacco Industry is shrinking. Besides China, much of the tobacco industry is mature and driven by consolidation, regulations and taxation – resulting in reduced profitability. A handful of major players (CNTC, PMI, BAT, PM USA, and JTI & Imperial) dominate. The supply side – lagging well behind – has a plethora of players who have not rescaled their business. The result: Piranhas in a goldfish bowl. This reality defines the recent competitiveness between WT and TR as they compete for exhibitors and attendees

 

But it didn’t have to be this way…….

Seizing what appeared to be an opportunity caused by the debacle which became TabInfo Asia Bangkok last November, WT announced World Tobacco Expo 2011 in Munich. But this announcement came after TR announced TabExpo would be held in Prague.

Why do this?

 It’s tempting to say – who knows – but the appearance of a direct confrontation by WT on TR is hard to ignore. Why else schedule another European exhibition immediately prior to TabExpo Prague, especially and knowingly that TabExpo was always held in November and every four years.

 

 

 

So who wins……………?

Until one organizer assembles an unassailable competitive position – not the tobacco Industry. Exhibitors now have to decide which show to attend and be able to justify it in this cost-conscious environment. It was an unnecessary move and a risky one by WT (that could easily have been avoided.) As it is, if both go ahead then each exhibition dilutes the other, diminishing profitability. If ever there was a time for Industry solidarity it is now.

How did this happen?

Like the Olympics, the Industry and TR agreed to hold TabExpo in Europe once every four years (excepting Barcelona, delayed until 2003.) This has been the case since 1994 and TR has kept to this agreement.

By contrast WT magazine, under the ownership of the Daily Mail Group (DMG) struggled to compete with the three other tobacco magazines; TR, TI and TJI. WT supplemented its profitability to DMG with trade shows which are now “two a year”.  Sadly it was after WT Asia last year that DMG ceased publication of WT Magazine and sold the WT trade show business to Quartz Business Media and announced a merger with TJI (where TJI’s role is to publicize WT’s events.)

So…… Is there space for two events?  Is there the need for annual events?

No.  And certainly not in the space of five days in November 2011.

What was WT thinking………………….?

3 comments ↓

#1 Glenn A John on 03.13.10 at 8:06 AM

I don’t really relish coming to the defense of competitors such as the World Tobacco/TJI coalition (WT), but we need to get something straight. Just because Tobacco Reporter (TR) had a few Tabexpo Exhibitions in Europe doesn’t mean they “own” Europe and all rights to shows there. This is especially true since they’ve ventured out of this territory 5-6 years ago to start up a roster of shows and conferences in Asia. Does WT “own” Asia and all rights to shows there just because they were the only traditional expo players there? I don’t think so. It’s a free enterprise system where individual for-profit players have any right to have an exhibition anywhere the market will bear. Also, let’s get clear on another concept. Just because TR announced their European show one week before WT does not get them credit in the first-mover category. TR pushed forward its plans to announce a show in Prague when I personally tipped them off that WT was imminently going to announce its own show in Munich. Planning events like this take several months of negotiations and there’s simply no way that WT hurriedly whipped up a location, hall and dates in one week just to “counter” TR’s announcement. Let’s just leave it that both shows were announced the same time.

One thing is certain: the growing number of competing and conflicting shows is the future of the tobacco industry as the individual magazines continue to try to out-do each other around the world. And it will get even more crowded once magazines not having shows decide to enter the fray. For one, Tobacco Asia, headquartered and operating in Asia, has a much better grasp on the Asia region that does its carpet-bagging colleagues TR and WT. Why should TA sit by on the sidelines and watch other magazine groups profit handsomely by holding shows willy nilly in what could arguably be called “Tobacco Asia” territory?

We think we have a solution which I, along with a growing group of concerned people are calling the International Tobacco Business Association (ITBA). ITBA’s sole purpose will be to own and operate tobacco industry exhibitions FOR and BY the industry itself. This will not be a lobbying group for tobacco industry issues. This will not be a profit center for a sole magazine group and its owner(s). This will be a private federation of key tobacco industry exhibitors whose leadership committee will call the shots on the who’s, what’s, when’s, where’s, and why’s of tobacco exhibitions that they will organize globally according to their own interests and desires. This is not rocket science. It has been the solution several industries have taken previously, many of them to solve the exact same problems we’re seeing in the tobacco business: too many shows, conflicting shows, and high costs. By organizing a solid association/federation, the ITBA with key supporting members will render the “too many shows” issue moot, as ITBA will decide which show it will hold, and non-member companies will follow. By owning and operating the shows, ITBA will have much lower costs to exhibitors than the above mentioned for-profit operators..

I along with Heneage Mitchell and Charles Allmer and other interested parties in ITBA will be at the WT India exhibition and would like to move this concept forward. Please contact us to discuss and put your name down as a supporter. TR and WT are sure to start announcing their conflicting and competing shows for 2012 any day now, and it’s best that ITBA moves forward by then, or the industry can simply expect more of the same going forward.

Looking forward to hearing from you

Glenn Anthony John – glenn@itobacco.org
Charles Allmer – charles@itobacco.org
Heneage Mitchell – heneage@itobacco.org
Benoit Jacobs – benoit@itobacco.org

#2 Former smoker on 09.01.10 at 7:40 AM

All of you should be shut down.

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