Ad:Tech NYC Wrap Up – The Mega Article

By now, most people have made it back "home" from ad:tech NYC, and are enjoying two of the most popular post-conference activities – sleep and organizing business cards. Despite the comfortable hotel beds. For many brave souls, or perhaps just a) those with lots of time on their hands and/or b) who live in NYC, Tuesday’s close of the expo hall didn’t signal the end of the conference. The show actually goes through Thursday. At least we hope it does, as we have a spot on a panel Thursday morning, but then again there is a chance we simply wrote something unappealing and the joke is on us to sTay the extra two days. As for the show floor, which in so many respects is ad:tech NYC, it once again looked like a shanty town on steroids, a sprawling mass of booths spanning three floors. According to the numbers we heard, the show again attracted more than 10,000 people, with as many as 12,000 registering. The main halls almost always felt full, but some spots weren’t filled in the tail of the booth space.

What We Saw

• Location, Location, Location – Booth space is typically assigned in a first-come, first-served order. Old-timers will start to sense some familiarity in the layout. What would an ad:tech NYC be without ICMedia Direct and their red army right outside of registration. They were in a battle of the bags this year as the three booths right outside of the main floor entrance also offered primary color fare to passersby. Other past exhibitors shuffled around some as they looked to increase their positioning. The good news is that even some of those tucked away in the nether regions of the show still saw some value, or at least they told us that to make themselves feel better about $7k for land in the desert. Perhaps the only thing we felt bad for besides the amount of alcoholic consumption were those on the third floor who paid for space only to have makeshift sessions happen around them. 
• Captain for President – Only in NYC on election day will you see someone dressed up as a pirate being ridden down 6th avenue during the mid-morning rush hour with followers in adjacent bikes holding signs and reading aloud, "Captain for President." I didn’t see him as a write in option on the ballet, but if the campaign measures it’s spend by cost per mention in article, they’ve got one conversion.
• Bridges Bar – Despite the name, the action in Bridges had little to do with any form of libation consumption. With an abysmal lack of meeting space, the hotels two main lounges, especially Bridges saw non-stop action. It wasn’t just for being social but where the meetings and deals took place. The place to be wasn’t necessarily on the floor but hanging around there as it would give you a different perspective of who was getting things done. Next year, the strategy will be to hunker down and make sure you have backup to continue holding a place. Perhaps you can even make a little sign so people will know where you are. It will be like the meat market of Affiliate Summit. The place works great for those in attendance, but I’m sure it causes some consternation for the servers as so few who sit are there to order. The bar should do what they do in the restaurant and impose a minimum order amount to improve margins.

• Steak and Sizzle – Differentiation is hard. There might be hundreds of companies exhibiting but there are only a handful of ways to make any real money. The savvy ones succeed at standing out by combining the two. They make money just like everyone else but their story sounds as though they’ve found a different way to do so. The steak is the meat of their business, not sexy but pays for the shows among other things, whereas the sizzle sells and brings in the people they really want or need for the future – the new deals, brands, investors, etc. It’s a challenge for any though when talking to a company, as you don’t know if what they say is really what they do. When you know what they really do, but here to pitch to those walking by, it’s tempting to flag down the person leaving the booth to let them in on the secret. The steak and sizzle strategy isn’t all bad, though, as it doesn’t always imply duplicity. It’s often a necessary way to grow a profitable company while reserving some focus for a bigger long-term plan, a way to justify the speculation.

What We Learned

• Spend into a Recession – There is an anecdotal tail about McDonalds’ strategy of spending big in a recession and how that strategy helped them in the past to pull away form their rivals who backed down in their marketing and overall business expansion. One CEO we spoke to liked to point out that it’s anecdotal for a reason. Then again, a company like McDonalds doesn’t ever seem to slow down on its marketing. Regardless of the truth of the story, it’s an interesting thought. It’s a common belief, and I would think that those companies who thrived in the dotcom collapse have shown that you can grab market share in recessionary times, especially if your company is healthy and has sound fundamentals. Perhaps the way to look at spending is: how does it help achieve the goal of more market share? If it doesn’t help to attract more customers and promote more business, then it shouldn’t occur. That is most likely why even when the sky was falling for tech companies they didn’t stop attending or exhibiting at certain shows.
• Alcohol as Lead Gen – The floor was once again a functional alcoholics delight. TARGUSinfo upped the ante this year, pouring not the typical frothy brew but two different types of frozen margaritas. We could call this, "How to sexy up a tech play." 500 drinks in less than two hours. Lots of money. Generating zero sales – Priceless. In all fairness, the strategy emulates that of the Captain for President. In this case, no one will buy a complex piece of software that second, but it did draw people, and by going more upscale in their giveaway, it did distinguish them and will make sure at least some who might not have otherwise done so, remember who they are. This is not an endorsement for all booths to have drinks, but it shows that offering alcohol is not a sign of last resort.
• All It Takes Is One – The question we heard more than any other was, "How was the show for you?" It could be that this question is the same as when people pass each other and say, "How are you doing?" They ask out of courtesy but don’t really care for an answer. Maybe that was the case, but going to a show, even with a free exhibit hall pass, costs money, and it’s a legitimate question to think about. For us, what we found at least, is that a good show only takes one great something, with that something depending on who you are. It could be an introduction that you didn’t have and might not have had before. It could be that deal that was closed that more than covers the cost, the bit of learning that will change how you market in the future, etc. It doesn’t matter if the show is big or small or what companies give away. It just matters that you found your one, as that’s what will keep you coming back.

• Relationships, Relationships, Relationships – You could spend a full day simply walking the floor and trying to understand what each company does and how they fit into the landscape. If you did that, you would ultimately miss out on the true value of the show, the people. Everyone should go to the show with a simple goal in mind. Meet five new people and strengthen your relationship with five previous people. That’s how the people you see who walk the hall and seem to know everyone do it. They definitely care about the companies, but they care about meeting with people more. Getting to know others has a secondary benefit as well; you will get to know the companies better as your relationships will have worked with many and provide insight that you couldn’t get otherwise.

What’s great about the show is the amount of information available from others. It’s one thing to go around and see what it means to you, but it’s even more valuable to listen to what others have to say and synthesize that information with your own perceptions. Where the above is what we gleaned from our observations, below are our takeaways from our interactions.

The Minds of Others

• Regarding the Buzz – There has never been a shortage of performance marketers on the exhibit floor, but if we think of the show floor as one version of the Internet zeitgeist, you might say there were even more performance marketers than generally is the case. It makes sense, though, as performance marketers tend to thrive when media prices fall and as more companies focus on metrics. Mobile and social had its representation, but it wasn’t the predominant theme, and there were only a handful of extravagant booths for companies that made more money in hype than actual dollars. It was a fairly 1.0 show, and that could be because San Francisco is geographically closer to the 2.0 companies or a sign of the overall media market. 
• Regarding Booth Babes – For the four female readers, pardon the following chauvinistic statement. The talent on the floor was the best it has ever been. The key difference though, was that it wasn’t all hired "models" performing the bait and switch. If anything, this year bucked the trend and was the reverse of the stereotype. Working the booths this year were fewer pretty faces and more of the executives in the company. Instead of seeing the floor as an ancillary activity or one they can relegate to others, they wanted to be out there, to hear what customers said, what potential customers needed, and to soak up the general sentiment so that they could gauge their companies health and position.
• Regarding the People – A not generally cynical person quipped, that ad:tech was a "great show if you want to see 12,000 people of which only 100 can make a decision." There might have been more executives in the booths than before, but for some people, they felt there was too much, "I’ll get back to you," or, "I’ll have to check and let you know." This experience offers a different way to look at the show. They didn’t want to simply stroll and take in ad:tech like a tourist walking the streets of Paris. They had a sense of urgency and a desire to get their business some real traction.

• Regarding the Future – One of the big banking firms recently came out and lowered their forecast for 2008 and 2009 growth. Their numbers were still healthy, just under 30% for this year and 13% for next year, but the takeaway was the same. The same CEO who questioned whether you could or should spend big during a recession (and spent time in the booth for the first time) seemed to summarize the next year best by saying, "It will be bad because people think it will." Many healthy companies will hold back on hiring, on trying new things, on potentially growing because they are too concerned with not shrinking. 

Best Advice

• Practical Next Steps – The number of business cards can turn a normal checked bag into an overweight one. It’s easily overwhelming. But you can’t measure success based on the number of new contacts. We were told something that is something we all intuitively know but may not have on our conscious mind. It isn’t what happens at the show but what happens next week that will separate the truly successful from those who just think about doing. We speak from experience here, but mainly from the latter, being one to get bogged down with the number of follow-ups that we don’t actually do the proper follow-up. And, the follow-up is just the baby step of the "what you do next." Set aside a few hours or give yourself a goal per hour to squeeze at least that part in.
• General Strategy – We spoke to one of our favorite investors who framed the path to higher probability success as the difference between building a better ipod compared to making the ipod better / stickier. It’s not that different from PayPal to eBay or Slide to Facebook – attaching oneself to the big platform, plugging the holes of what they missed. The number of people who can be Mark Zuckerberg of Facebook – getting lucky really that the idea took off – is few. The next big idea that changes how users behave is appealing but not practical. I thought Google was in the category of trying to build the next ipod, but it turns out that they probably weren’t. They built a better search experience initially, but Google became Google when they out-executed overture in paid search monetization.
• Who Succeeds – Very few entrepreneurs have the level of brilliance that Bill Gates or the Google founders do. But, that’s not a requirement for success. We were told that two of the better indicators are common sense and passion. Common sense doesn’t imply overly-smart; it implies a sense for knowing how things work and how to make money. Being smart on top of that simply helps. Passion matters because the person with high common-sense often has to work harder than the super smart guy. Passion is the the 90% perspiration that makes the 10% inspiration possible.
• Cash in Hand Is Not a Bad Thing – This year and next, we may not see many multi-hundred million dollar acquisitions for companies that have yet to break even, but even during turbulent financial times acquisitions don’t stop; it slows down, especially those based on speculation where super high multiples and generally unrealistic expectations live. We heard from deal guys, at least those on the buying front, that they love times like these, because this is where they can find value. What if you are someone that might get sold. A mantra we heard that we liked was, "It’s never to early to sell, and the price is never too low (if it’s enough for you)." Selling seems a lot like betting on the stock market. We can all wish we sold higher, but selling for a profit is still selling for a profit. This next year could turn out to be a very good time for quite a few companies if they don’t mind being in rational deals.