Snell & Wilcox announced today a series of significant changes to its European marketing strategy, including a decision not to exhibit at IBC 2005 in Amsterdam this September. The changes, which result in no budget cuts and maintain the company's current level of marketing expenditure, follow a comprehensive internal review of how the company traditionally spends its marketing budget.
Snell & Wilcox explained its decision in a letter from Joe Zaller, the company's vice president of marketing and product management, which was posted to customers on June 14.
"Following a comprehensive internal review of how we spend our marketing budget and the return we achieve from this investment, we have decided to shake up our approach and change the way we invest in marketing," Zaller said. "Like many vendors, a major percentage of our marketing budget has traditionally been allocated to trade shows. Although they are undoubtedly extremely valuable, large trade shows are also very time-consuming, and can be an inefficient use of our resources when compared to other ways of communicating with our customers. Therefore, Snell & Wilcox has decided not to exhibit at IBC 2005 in Amsterdam this September.
"This decision should not be interpreted as a wholesale rejection of major trade shows. We are still committed to the annual NAB trade show in Las Vegas, and it is not our intention to abandon IBC permanently. Our plan is to evaluate IBC participation on an annual basis, with the possibility that we may opt to attend IBC every second year going forward.
"Our decision to skip IBC 2005 is not a move to cut costs. Rather, it is based on a desire to gain more impact with our marketing budget by exploring new opportunities available to our company. Since our business is strong and continuing to grow, we see no better time than now to make bold changes that we hope will create more value in our efforts to communicate with the market.
"It is important to note that we are not questioning the value of IBC as an exhibition or an institution. Instead, we are questioning whether it makes sense for our company to concentrate significant time and a major percentage of our European marketing budget on a single five-day event when we could be using that time and money on regional marketing programs that last for the entire year.
"We're not looking to spend less, but to spend smarter. We plan to use the nearly $1 million that we will save by not exhibiting at IBC 2005 to enhance our marketing activities in a variety of ways. These include our participation at dozens of smaller trade shows as well as product and technology roadshow events that will allow us more quality time with our customers. Specifically:
During 2005, we will exhibit at approximately 15 smaller, regional broadcast shows in the United Kingdom, France, Italy, Spain, India, Japan, Russia, China, Singapore, Dubai, Australia, and South Africa. Many of these smaller shows occur every two years and most are set for this year. So we felt that 2005 was the ideal time to give these regional exhibitions a try and see if they allow us to better reach customers on a more personalized basis.
This change of emphasis will allow us to spend more time on focused personal contact with customers rather than on rushed impersonal presentations in a crowded exhibition environment. We plan to create customer events that enable us to understand and better serve the needs of the market. For example, we will host a series of product and technology roadshows in each of our regional sales territories, and we will more proactively include key customers in our strategic planning processes.
The cost savings from IBC will enable us to significantly increase our general market presence through increased promotion. Therefore, we will increase our spending on advertising, public relations, and direct marketing.
We will enhance the capabilities of our sales force through improved collateral, better sales tools and back office systems, and more extensive training.
We will significantly enhance our customer service and training capabilities, including the establishment of the Snell Academy, a training facility based at our U.K. headquarters.
Finally, we are undertaking a major redesign of our Web site. The importance of the Internet in providing better marketing support cannot be underestimated. Our goal is to make it easy for anyone to learn about our products and technologies in a straightforward, comfortable way. Using multimedia technologies, we plan to make the Snell & Wilcox Web site an important broadcast industry resource on emerging technologies.
