Defense contractors who measure their trade show ROI are able to increase the effectiveness of their marketing investment and determine which shows are working. And which aren't.
For many defense contractors, trade show marketing is driven by one the most powerful forces on the planet: inertia.
Many companies keep going to the same trade shows every year without much hard analysis of if the trade show is generating a positive ROI. Additionally, there are other trade shows defense contractors are not attending which might be a better investment.
You can determine if a trade show is worth the investment.
In an excellent HubSpot ebook on measuring trade show return, a two-part approach is recommended which focuses on 1) ROI and 2) Tracking:
The best way to track ROI is using this formula:
(Gross Profit - Marketing Expenses) / Marketing Expenses
Given the long sales cycle of a defense contractor, you won't know right away if you had a positive ROI on your trade show investment.
However, when that time comes, here is how you'll calculate the ROI:
ROI = (Gross Profit - $100,000) / $100,000
It's important that the gross profit number reflects deals that happened due to attendance at the trade show. For the purpose of the calculation, you would assume that the deals would not have happened if you didn't attend.
To determine what leads and sales were generated as a result of the trade show, a CRM tool is recommended. CRM (Customer Relationship Management) is software for managing a company’s interactions with customers, clients, and sales prospects. An example of a CRM product is Salesforce.com.
During or immediately after the show, enter every lead generated (via badge scanning, business cards, or email addresses collected). Then set up reports to monitor the performance of those leads, and when a lead becomes a customer, calculate the lifetime value of that customer and enter it into an updated ROI calculation for that show.
As the lead matures, you will be able to determine which shows are generating a positive ROI and which shows might actually be a drag on earnings.
Question: How do you determine whether your presence at a trade show or event was worth the cost?