Destinations

The Conference Industry is Booming, And It Is Only Getting Bigger

Aug 04, 2013 5:00 am

Skift Take

Even as everyone predicted the rise of digital would do away with face to face, precisely the opposite is happening, as the value of in-person meetings and conventions rises. And the need’s only getting bigger, much to the delight of the travel industry and CVBs.

— Rafat Ali

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Erik Charlton  / Flickr

Al Gore, at one of his TED talks on global climate change, in 2009. Erik Charlton / Flickr


A creature of the information age, Tim Bourquin feeds on the Internet. He is an expert on webinars, email marketing campaigns and social-media strategies. He is the co-founder of AfterOffers.com, a website for buying and selling sales leads.

The dizzying pace of change makes it essential to stay current, so Bourquin does whatever it takes to hear the latest — even stepping beyond cyberspace into real-world spaces, where he can mingle. He likes to find himself in a crowded hallway, talking with someone he met on the fly. Or in a hotel bar, having a long, meandering conversation, because out of the laughter and chit-chat he sometimes forms a bond or has a flash of insight.

Which is why he goes to conferences — about 10 a year, he says, many in Las Vegas, others as far away as Japan, where he attended an industry summit on nanotechnology. Bourquin’s travels challenge popular assumptions about how ideas are shared on a wired planet. Many experts believed that the need for face time would diminish, that people would avoid hassling with airports and rental cars once it was possible to connect instantly from anywhere.

The opposite is proving to be true. The conference industry is booming, expanding more or less in parallel with the Internet. Conferences not only are getting bigger and more numerous, they are tackling more daunting problems. Topics have gone global — renewable energy, atmospheric warming, the plundering of the seas. The very way information is exchanged is evolving, different now than in pre-Internet days when events were less plugged-in and interactive — more limited to the so-called sage on a stage.

“Some of the best shows have an online component,” says Bourquin, 44, who lives in Laguna Niguel. “You create a profile and upload your bio, your history, what you want to achieve, and other people can message you and set up meetings before the event.” With registration costs alone running up to $1,000, Bourquin says he works hard to make trips pay off. He keeps a notebook listing sessions he will attend, ideas he’s picked up. Occasionally he tracks down would-be clients who have failed to return his emails — and finds, generally, that after a face-to-face conversation the email channels open up.

“There’s a trust that gets built,” he says. “I’m no longer that faceless email that comes into them. It just kind of accelerates the relationship and brings it to a higher level.”

GLOBAL EXTRAVAGANZAS

Historically, important ideas tend to become isolated in their own disciplines — locked in silos, to use a standard metaphor. Pharmaceutical knowledge remains in the realm of pharmacy, the quirks of the aerospace industry occupy a different place. Breaking down those divisions has become a goal of some of the fastest-growing high-brow events, such as the $7,500-a-head TED Conferences, which have been held in Long Beach and have spun off thousands of smaller TEDx events worldwide. Other examples include the Clinton Global Initiative in New York, founded by former President Bill Clinton to address some of Earth’s most pressing social needs, and the Milken Institute Global Conference in Beverly Hills.

The latter has grown from a modest, daylong economic forum 16 years ago into a vigorous, three-day idea fest attended by 3,500 speakers and guests — including heads of state — from 50 nations.

During Milken’s run at the Beverly Hilton Hotel, participants observe and feel the energy of some of the world’s richest and most powerful people assembled in a single spot. Lines of gleaming BMWs and Mercedes-Benzes fill the valet lane. News networks stake out the lobby, erecting makeshift booths and broadcasting interviews. Remaining spaces become packed with so many men and women in suits that it’s difficult to move. At a cocktail bar adjoining a wing of meeting rooms, a din of conversation envelops groups and individuals talking, drinking, pecking at their laptops.

Panelists this spring discussed human longevity — could someone live to be 1,000? Down a hallway, tech experts examined the spectacular growth of the cellphone app industry, now worth billions. Microsoft founder Bill Gates joined former British Prime Minister Tony Blair to discuss economic investment in Africa and efforts to eradicate polio. Larry King interviewed the world’s richest man, Carlos Slim.

Every moment is filmed and posted online. But for all of the public banter, “some of the most interesting conversations go on in the speaker ready room,” one of the many semi-private places where the alliances are formed, where plans are set in motion that literally shape the course of world events, says Michael L. Klowden, CEO of the nonprofit Milken Institute.

Medical-science discussions have led to congressional funding, Klowden says. Former Vice President Al Gore hooked up with a film director at Milken, and their collaboration led to the documentary “An Inconvenient Truth,” about global warming, helping to earn Gore the Nobel Peace Prize.

“Two things are happening,” Klowden says. “Because of the incredible spread of information that’s circulating around the world, people are better informed, in general, about what’s going on away from their own narrow fields. And if they’re not better informed, they want to be. There’s a sense of the unsettled nature of the world and a feeling of necessity about getting together to discuss solutions.”

BOOMING MARKET

According to the U.S. Bureau of Labor Statistics, conventions and events are expected to expand by 44 percent from 2010 to 2020, far beyond the average projected growth of other industries. Orange County, with its appealing climate and tourist attractions, is reaping a share of the windfall. Demand for conference space is up at the Anaheim Convention Center and at beachfront resort hotels such as the Montage in Laguna Beach and the Ritz-Carlton in Laguna Niguel, site of a recent Brainstorm Green environmental conference.

The California Women’s Conference, which achieved national prominence when former California first lady Maria Shriver brought in the Dalai Lama and Oprah Winfrey, returns to the Long Beach Convention Center in May after a year’s hiatus.

Just as television has entered an age of choices, with channels catering to almost every conceivable interest, the conference industry markets an intellectual smorgasbord, often presented against a backdrop of ocean vistas and trendy urban promenades — trips paid for out of corporate accounts, or at the very least tax-deductible. A zealous conference-goer could travel to a new city every week and never exhaust the movable feast of issues and ideas — about smart-grid systems, electric cars, mental illness, cloud computing, mathematics, farming methods, aging.

Top economists convene in Wyoming for the Jackson Hole Economic Symposium, where last year Federal Reserve Chairman Ben Bernanke, a regular, made headlines addressing the looming fiscal cliff. Comic-Con, inspired by comic books, wrapped up its most recent extravaganza in San Diego. Christmasworld, the biggest event in what organizers call “the international festive-decoration sector,” stages its next annual shindig in Frankfurt, Germany, in January. A whopping 30,000 visitors are expected.

The conference industry is big enough to have its own awards banquets and its own annual conference in Boston, which might be less surprising than the fact that Apple, Google and Microsoft have become conference hosts — with Samsung soon to follow, this fall in San Francisco. Tech giants are loath to divulge proprietary secrets, but putting on conferences enables them to hawk products and strengthen ties to members of their distribution chains. Corporate executives get a chance to raise their professional profiles, notes Trey Ford, general manager of the Black Hat tech security conference held in Las Vegas.

Black Hat — the reference is to bad guys — is essentially a conference of computer hackers that began in the late 1990s, during the dot-com boom, and has grown to more than 6,000 participants. In a topsy-turvy era of National Security Agency spying and purported sabotage from China, hackers have come to be seen as potentially valuable resources in the quest to shore up vulnerable networks. Speakers at Black Hat must go through a lengthy screening process.

“Getting accepted at Black Hat is more than a feather in the cap,” Ford says. “It really is a rocket ship for researchers to get into the spotlight.”

Sponsoring companies represent a who’s who of high tech — Microsoft, Cisco, Amazon, Dell, Oracle. Top-tier sponsorships sell for more than $100,000.

“The more that people are connected electronically, the more hunger there is to meet face to face,” says Michelle Russell, editor of Convene magazine, published by the Chicago-based Professional Convention Management Association. Being friends on Facebook, or trading 30 emails a day, is not so much a substitute for personal contact but a tease, she says, making us want more.

INVESTING IN IDEAS

Fevered interest in the latest thing creates a fear of missing out among people deciding if they want to attend a conference, and it stirs visions of vast revenues for organizations or entrepreneurs willing to gamble on the right theme, the right look and other intangibles necessary for a conference to take off. Typically, events are put on by trade associations, nonprofit institutes or those with money and a vision.

The last category has included serial big thinkers such as TED founder Richard Saul Wurman, who, since selling the TED organization, has launched the WWW Conference to showcase “improvised conversations” between pairs of brilliant minds. Architect Frank Gehry and human-genome sequencer Craig Venter were part of the 2012 program — “the best conference I ever did,” says Wurman, who says he did not advertise it and it did not make a profit.

Wurman now is planning a conference he calls 555. It will provide a stage next year for five global experts to meet in each of five cities, yet to be identified, on five consecutive Mondays — a roving forum of “intellectual jazz,” as he terms the free-ranging discussions, due to address the future of travel, architecture, the media, energy and entertainment.

Vonage co-founder Jeff Pulver is another of the entrepreneurial ilk. He used the groundbreaking voice-over-network technology as a core theme of the VON Conference & Expo he launched in New York in 1993. From about 500 attendees its first year, VON took off and began drawing upward of 7,000, with more than 100 presentations crammed into a three-day span. Pulver, who says some of the best action occurred during fantastic parties at night — “Companies were born, companies got funded, people got jobs” — won’t disclose how much money he made by facilitating those unions, except that it was a bundle.

“Well-run trade shows are as profitable as a well-run software company, if not more so,” Pulver says.

Since selling VON, Pulver has struggled to recapture the magic, devoting himself to smaller events centered on Twitter and the real-time Web.

“All shows evolve. Some are growing, some are shrinking, so you have to figure out where you are in the life-cycle of your show and your industry,” says David Saef, executive vice president of marketing for Global Experience Specialists, a Las Vegas firm that helps conference organizers stage events.

The conference industry’s many ups and downs include a boom during the easy-money 1990s, a bad period after 9/11, and another dip during the recent recession. The naysayers keep predicting a decline, but face-to-face marketing remains a major budget category, and successful conference organizers today can achieve 30 percent profit margins, Saef says.

RISKS AND LOGISTICS

Yet the risks are substantial; conferences are hugely expensive to arrange and require many months of planning for a jackpot that lasts less than a week. Saef helps to put on the annual conference of the American Wind Energy Association, a green-power event held this spring in Chicago. Scarcely a month after it was over, he was already at work on 2014. Saef flew to Washington, D.C., to sit down with officials from the trade group and go over what should be tweaked for next time.

Planners will have to refine next year’s theme and undertake the long process of screening speakers. Promotional campaigns will follow. Near the end, event crews will invade a barren hall and rig it with electrical wiring and booths to accommodate 550 exhibitors.

Until a conference is well-established, organizers must grapple with weighty questions about what to charge and whether people will come. Is the venue right? Is it better to be in Southern California, a relatively pricey market, or Atlanta or Phoenix?

After two years of planning, global events firm UBM selected Anaheim for its Business4Better Conference earlier this year in part because Mayor Tom Tait arranged for free use of the Anaheim Convention Center. The goal was to hook up nonprofit organizations with corporations willing to support their work. Turn-out was fair — 1,600 people registered — but nonprofit groups far outnumbered their corporate counterparts, and the conference lacked the energetic buzz of, say, Milken, leaving program director Nina Brown to puzzle over fixes for 2014.

Drawing in new players is only one challenge. Post-conference feedback suggested there were too many speakers and panels and not enough time to wander the conference floor. Long aisles and high partitions impeded the chance for attendees to interact. Next year, Brown says, the straight aisles might give way to a broken oval.

“Maybe we don’t need high walls,” she says. There could be pods, tables with pop-up signs.”

‘ENGINEERED SERENDIPITY’

Conferences can take years to grow — if they grow at all. One spectacular model of success is the South By Southwest Music & Media Conference & Festival, better known as SXSW, in Austin, Texas. Since its launch in 1987, primarily as a music festival, SXSW has expanded to encompass film and digital media and attracts 30,000 people.

The event was a key launch pad for Twitter. Its economic impact on Austin is an estimated $190 million, says Chris Sonnier, a program manager for the private company that built the spectacle.

Why has SXSW exploded? Partly because Austin is a creative hotbed rife with music clubs and young people. What conference organizers succeeded in doing, Sonnier says, was introducing “engineered serendipity,” a framework for bringing the right individuals together in the same rooms.

Even SXSW’s own promoters would like to replicate the formula. Spin-offs include conferences on education and venture capital. SXSW Eco, a conference about energy, climate and related issues, holds its third gathering in October.

More than ever, conference planners augment their panels and keynote presentations by paying particular attention to the overall experience — the ambience, the physical spaces. Montreal’s answer to SXSW, a conference known as C2-MTL — “C2″ is shorthand for commerce and creativity — debuted last year as a collaboration between an advertising agency and Cirque du Soleil, a master manipulator of the senses.

Set in a canal-side former industrial zone, the May conference drew 2,000 attendees who paid $3,400 apiece. They attended seminars in a specially restyled art institute and adjoining village of tents and cafes — all carefully arranged “to have people crash into each other,” says spokeswoman Elisabeth-Anne Butikofer. The latest thinking, she says, is that “the environment where the conference takes place is just as important as the content,” a philosophy derived, in part, from legendary creative spaces of the tech world.

At Bell Laboratories, the huge New Jersey facility that spawned innovations such as the transistor, the laser and cellular phone technology, visionaries of the 1930s purposely located offices at inconvenient distances from labs. “By intention, everyone would be in one another’s way,” writes author Jon Gertner “The Idea Factory: Bell Labs and the Great Age of American Innovation.” One hallway was 700 feet long. “Traveling its length without encountering a number of acquaintances, problems, diversions and ideas would be almost impossible,” Gertner points out. “Then again, that was the point.”

Jeff Swenerton of Center for Resource Solutions, a San Francisco-based nonprofit, notes a similar effect at Pixar, the famous animation studio, where Steve Jobs scrapped original architectural designs and insisted on a central atrium where he expected various units to mix — and where he located mailboxes and restrooms. Pixar’s creative success comes to mind every year when the nonprofit selects a location for its Renewable Energy Markets Conference, Swenerton says.

“We think about it when we look at the hotels,” he says. “We’ll take the floor plans and spread them out and think about how the conference will ebb and flow.”

AESTHETICS OF CREATIVITY

Some conferences embrace environmental beauty as part of the magic of creativity and stage their retreats at resort locations where you might go even if you cared nothing about ideas. Philip Lader, former U.S. ambassador to the United Kingdom and present chairman of London-based media giant WPP Group, founded an invitation-only conference held five times a year far from the public spotlight. Upcoming locations include Aspen on Labor Day, Napa Valley in the fall and Laguna Niguel next year, when guests will assemble at the Ritz-Carlton on a bluff high over the Pacific.

Bill Clinton attends regularly, as do several members of the U.S. Supreme Court, says Lader, who founded the Renaissance Weekends in 1981. Nobel Prize winners, astronauts and other nationally known figures join in candid discussions of topics ranging from race and politics to health and theology, shielded from media coverage, Lader says.

Aspen also is the setting for the Aspen Big Ideas Festival, founded nine years ago by the nonprofit Aspen Institute. Walter Isaacson, author of “Steve Jobs,” the best-selling biography of the Apple founder, is president of the institute and former chairman of CNN. He envisioned the retreat as a three-ring intellectual circus, says spokesman Jim Spiegelman.

“A lot of sessions are going on simultaneously,” Spiegelman says. “Some might want to hear (former Fed Chairman) Alan Greenspan hold forth on the future of the economy. At the same time, someone might want to go hear Yo-Yo Ma play the cello.”

Aspen’s landscape gives the conference a special allure, Spiegelman says. “There’s no question you lose something in a building or hotel as opposed to being out in the Rocky Mountains.”

Cynics might suggest the conference is secondary to the destination, that the ideas become an excuse to go somewhere interesting — to take a trip that wasn’t actually necessary. But the nature of ideas, and of chance meetings, is uncertainty. The only way to know if a conference will be worthwhile is to be there, listening to the talks, making the connections. Nothing might pan out, or a sort of magic might occur, as it did once for Marc Freedman.

Freedman, the founder of Encore.org, a San Francisco nonprofit that helps people find second-act careers, is a sought-after panelist who attends 25 or 30 conferences a year. Early on, he traveled to Miami, brooding on the plane about tasks left behind at his office and fearing the trip was a waste of time.

In the conference audience he met an official from a major grant-making organization. After the meeting, Freedman’s fledgling organization received a gift of $6.8 million — a boost critical to its growth. The conference turned out to be one of the most important meetings he ever attended.

“From a logical perspective,” Freedman recalls, “I never should have gone.”

See also PART TWO: The TED Conference factor

Related: A sampling of Southern California conferences ___

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