Probe into the Chinese event venue market – From an outside perspective
For the past decade, China has been the fastest emerging event market, in particular with regard to appropriate venues, i. e. exhibition centres, convention centres, (indoor/outdoor) arenas and performing arts centres. However, there is lack of published comprehensive overviews about the recent development and of reliable and comparable statistics. In the following essay, the author attempts to provide greater clarity on the numerous uncertainties prevailing in the various depictions of reality. After meticulous research, and despite only being able to analyse Chinese sources published in English, some significant findings were generated. Based on a number of selected examples, these findings reveal that a more differentiated approach should be applied.
1 Introduction
It goes without saying that any event of any kind can take place at any, or rather virtually any, kind of venue. Not only is there a great variety of events – there is also a reasonable number of venues that event organisers can choose from. They must decide which venue ideally matches the particular event. Hence nowadays, most event venues, despite many having been designed and built for a specific purpose, can be used as multipurpose venues. In practice, this means that, by making the relevant technical adjustments and providing the necessary services, venues can host a wide range of events.
Although the overwhelming majority of event venues are built, owned and run by the state, with the exception of hotels, the management has to operate in different related markets. It must cope with strong local, national and even global competition, and must be committed to strict customer-oriented entrepreneurship.
Furthermore, strong relations exist between event venues and where they are located, encompassing other players in the event business such as airlines, hotels (accommodation), shuttle and taxi services, related service suppliers, tour operators and local or national authorities.
The outside perspective is derived from the perspective of the German/European, American (USA) and Australian state of the art, contrasted with the current situation in China.
In the following sections, we will introduce and describe four of the most common and popular types of event venue in China from the perspective of the venue management. We will also outline a number of consequences of the outside perspective that may be considered in order to keep pace with the rapidly changing demands of the market (latest facts and figures as of February 2015).
–Exhibition centres ? Convention centres (also convention and exhibition centres)
–Arenas (or indoor stadiums)
–Performing arts centres
–To complete the picture, other additional types of venues are outlined.
2 The event venue market in China
In general, the pivotal questions in the event business are (to name but a few):
–What is the destination like (country/region/city)?
–Size/population/catchment area
–Accessibility (national/international) (airports/railway network (high speed)/highway network)
–Importance and economic structure (industry/trade)
–Science/education (universities, R&D institutes)
–Socio-economic level
–Political and administrative importance
–Number of headquarters of national/international companies and organisations (government/associations/NPO/NGO/societies)
–Scope of local, national and international mass media (coverage)
–Number, capacity, quality and price level of hotels
–Tradition and reputation as a trade fair/convention/event destination
–Site/location in the city
–Type, size and capacity
–Accessibility (public transport, parking lots, loading areas for trucks)
–Infrastructure, functionality, maintenance
–Public amenities on site
– How is the venue managed?
–Price policy
–Official/legal (local) rules and regulations
–Levels of standard of facility management/TQM
–Safety & security requirements
–Scope of services (technical supplies, IT, catering)
–Flexibility to provide services at short notice
–Smooth operational processes (before, during and after an event)
–Flexibility to cope with changes and unforeseen circumstances
–Additional costs for modifications and amendments
–Emphasis on sustainability and CSR (growing in importance)
These criteria, which may be used as a checklist, are standard practice worldwide. They focus on the prerequisites for success in the event business, and are therefore fundamental for all those involved: destination marketing organisations, the venue management, event organisers and the masses of people who visit a venue to experience an event.
3 Exhibition centres
All those active in the event industry know that exhibitions and trade fairs have been expanding rapidly in China, and continue to do so. Here is some information about the current situation.
3.1 Interaction between exhibitions and venues
Three particular circumstances that determine interaction between exhibitions and venues:
a.Appropriate dates for the exhibition in question, i. e. the right slot in the calendar
b.Amount of space available with regard to the rapid expansion of the individual exhibition due to rapid growth in the number of exhibitors and the space required
c.The need to explore scattered markets, i. e. rotating between different cities and regions If the chosen venue is unable to provide the appropriate slot or additional space (very often, venues undertake to build new halls in time so as not to lose an exhibition), the organiser will be forced to look for another venue.
This example underlines the remarkable, but time- and effort-consuming, development.
The China Sport Show (China International Sporting Goods Show) has been organised since 1993 by the China Sporting Goods Federation (CSGF), a nonprofit association founded in the same year. CSGF, directed and supervised by China General Administration of Sport and the Ministry of Civil Affairs, now has about 700 members. The domestic market, with more than 430 million frequent sports participants, is undoubtedly a solid basis offering good prospects.
Nonetheless, the exhibition started in Xi’an on a very small scale, taking up only 4,150 sqm in space. Since then, it has rotated annually between different cities, and has been growing rapidly by area and number of stands. In 2001, the show became international and moved to Beijing, now covering 65,000 sqm. One year later, the show was split into a summer show (Shanghai; 75,000 sqm with 4,000 stands) and a winter show (Beijing; 12,000 sqm with 400 stands).
While the summer show continued to developing rapidly, the winter show remained behind. For this reason, it was abandoned in 2011. In contrast, the summer show, this time taking place in Chengdu, covered 100,000 sqm, an area it reached as early as 2004. Due to the steady growth in development, the organiser had to choose new, bigger venues to suit the event.
The 32 shows that have been held to date – the 12th China International Sporting Goods Show Summer 2004 had to be cancelled due to SARS – rotated between exhibition venues in Xi’an, Fuzhou (3x), Tianjin, Nanchang, Wuhan (2x), Changsha, Changchun, Chengdu (5x), Beijing (11x), Shanghai (3x) and Harbin.
The China Sport Show now boasts 100,000 to 120,000 sqm exhibition space (5,000 standard stands), 1,000 exhibitors, 50,000 buyers from over 70 countries, 100,000 sports-minded visitors, and media coverage by 100 sources.
The 33rd edition in 2015 will be held at Fuzhou International Strait Conference & Expo Centre. SICEC is one of the biggest exhibition centres in China. The facility, built in iconic architectural design, offers 100,000 sqm covered exhibition space. The built-in conference centre covers an area of 86,000 sqm with 42 different sized meeting rooms.
3.2 General aspects of exhibition venue management
The majority of exhibition centres, convention centres, arenas, stadiums and performing arts centres were built and financed by governmental or municipal entities, sometimes also totally or partially in public-private partnership (PPP). In most cases, financial support includes contributions to cover the venue’s (fixed) costs, such as investments, depreciation, interest and salaries.
The legal form of the company, which also affects the management, is manifold, and varies in all countries. In most cases, however, public authorities are behind the company, at least as members of the supervisory board.
Venue management generally comprises:
–Strategic management (corporate strategy, planning, budgeting, organisational development, booking policy/event portfolio, rental policy/pricing, local, national and international networking, shareholder and stakeholder issues, performance monitoring, CSR)
–Operational management (operational principles, scheduling, logistics preparation, room set-up, operations, dismantling staged events)
–Facility management (cost planning, controlling, contracting, maintenance, technical supplies, contracted services, security/safety, energy efficiency, waste, cleaning, TQM, “Going Green”)
–Information and communication technologies and digital business
–Customer-focused services
–Risk and crisis management (financial issues, legal affairs, lease contracts and conditions)
–Human resource management (HRM)
–Marketing and public relations (market research; marketing mix)
–Catering, organisation of food & beverage (F&B)
This catalogue of duties can be compared with any other business management, albeit focusing on the particular prerequisites of events and the requirements of those involved. The most specific tasks include related services such as technical support, stand construction, catering, venue advertising and mass media relations.
Besides running and operating its venue, the business activities of an exhibition (trade fair) company may also include:
–Managing other venues
–Hosting exhibitions for external companies
–Planning and organising own exhibitions at the home venue
–Organising own exhibitions at other venues at home or abroad
–Organising joint participations of domestic exhibitors at overseas exhibitions.
The scope of the main business of Shanghai Expo Co., Ltd. (SEC), the management entity of the National Exhibition and Convention Centre (NECC) (see Discursion Case No. 1), describes best the corporate policy of a future-oriented venue management.
a.Ownership of venues and supporting facilities: to invest in and construct the complex, which integrates such functions as exhibition venues, comprehensive auxiliary services and supporting facilities into one building.
b.Venue operation: to undertake the daily management of the complex, including leasing the venue.
c.MICE development and management: to organise various exhibitions, meetings, conferences and major events at domestic or international levels as an organiser, co-organiesr or contractor.
d.MICE-supporting services: to manage the office buildings and other commercial facilities, and to offer services such as stand construction, advertising design, exhibition consultation, publication and information services, e-commerce, warehousing and logistics, food and beverage.
(Source: http://en.cecsh.com)
If the venue stages no exhibitions of its own, or at least not without the strong support of the related industry association, the management has to strive to acquire outside exhibition organising companies as their key clients. Several exhibition centres in China, or their subsidiaries, already organise a couple of their own exhibitions, a few of which even abroad. Yet the overwhelming majority of exhibitions are organised by other companies.
AUMA reports that there were 1,300 exhibition organisers in China in 2012. Of these, 820 (63 per cent) were domestic companies, 300 (23 per cent) were associations, 118 (9 per cent) were governmental or municipal entities, and 65 (5 per cent) were foreign companies or joint ventures (source CCPIT). The most active organisers in the latter group are REED Exhibitions (UK), UBM (UK), E.J. Krause (USA) and Messe Frankfurt (HK) Ltd., which now has branches in Beijing, Shanghai, Shenzhen and Guangzhou.
Some exhibition centre companies, notably in Europe and first and foremost in Germany, are not only owners and operators of exhibition halls, but also organisers of a couple of their own exhibitions – B2B and B2C.
Furthermore, starting in 1987 with the Messe Frankfurt and “interstoff Asia” in Hong Kong, a growing number of these companies have also been “cloning” their own exhibitions in foreign countries.
Many of these have subsidiaries, specialising in stand planning and construction, and running joint participations of their national exhibitors in foreign exhibitions. The China Council for the Promotion of International Trade (CCPIT), an independent organisation, has many years of success in these activities. Its subsidiary – China International Exhibition Center Group Corporation (CIEC) – has been following in its footsteps as a supporter of Chinese group participations at foreign exhibitions. However, it also organises nearly 20 of its own international exhibitions in China each year, and operates the China International Exhibition Centre (CIEC) and the large New China National Exhibition Centre (NCIEC) in Beijing.
3.3 Three main business models in the exhibition market
Briefly, there are three main business models in the exhibition market
A. Investor/owner:
Municipality/government – public-private partnership – private company
B. Venue management:
Municipality department – public/private joint venture – private company
C. Exhibition organiser:
Private – association(s) – government – venue management/subsidiary
It is not surprising that the aforementioned organisations experience an overlapping of cooperation and joint ventures as far as legal construction, financial ties, strategic and operational aspects, corporate policy and entrepreneurship are concerned. This overlap depends on many specific prerequisites in the world’s different countries that cannot always be compared.
Most exhibition centres around the globe were financed, built and owned by the (municipal and/or regional) government [Model A]. The operating entities of most venues are also publicly owned (legally or financially supported); in some cases, they are operated by a private company (on behalf of the government) [Model B]. Some venue operators are also exhibition organisers on their premises [Model C]. In Germany, all big “Messe” companies (such as Messe Frankfurt and Messe München International) are a combination of all three models.
Excursion: The network of exhibition organisers and venue management companies in China
Here we give three examples of organisational structures in China. These examples show that there is already a remarkable variety of combinations of different models.
3.3.1 Case No. 1
–China Foreign Trade Centre (CFTC)
This centre is affiliated with the Ministry of Commerce of the People’s Republic of China. It has been responsible for organising the China Import and Export Fair, also known as the Canton Fair, since its establishment in 1957. CFTC is the owner and operator of the China Import and Export Fair Complex (Canton Fair) on Pazhou Island, Guangzhou.
–China Foreign Trade Centre (Group)
A business entity affiliated with the China Foreign Trade Centre (CFTC). It mainly conducts all forms of exhibitions, including foreign exhibitions in China and Chinese exhibitions both at home and abroad (http://www.ciefc.com).
–China Foreign Trade Guangzhou Exhibition General Corp. (CFTE)
This company is wholly owned by the China Foreign Trade Centre (Group). It has four branches: CFTE Furniture Exhibition Company, CFTE Outbound Exhibition Company, CFTE Building & Decoration Exhibition Company and CFTE Business Development Exhibition Company.
CFTE is the organiser of large domestic exhibitions. In 2013, it completed ten exhibitions in China and three overseas, with a gross space of 1.5 million sqm. CFTE is also an important agent for many international trade events. In 2013, it helped Chinese companies to showcase their products in 35 exhibitions outside of China.
One of its major exhibitions is the China International Furniture Fair (CIFF), which takes place at the China Import and Export Fair Complex in March and September. The autumn version will be moved to the National Exhibition and Convention Centre (NECC) in Shanghai/Hongqiao.
–National Exhibition and Convention Centre (NECC), Shanghai/ Hongqiao
This centre, managed by Shanghai Expo Co., Ltd (SEC), was jointly established by China Foreign Trade Centre (Group) and Shanghai East Best International (Group) Co., Ltd. in July 2011 in accordance with a cooperation framework agreement signed by the Ministry of Commerce and Shanghai Municipal Government.
–Shanghai East Best & Lansheng International (Group) Co., Ltd.
Although its core business is human resources and related services, the company also provides conventions and exhibitions, communications and trade services. Furthermore, the company has also successfully managed its own exhibitions, the most important being the China International Industry Fair (CIIF). The 17th CIIF in November 2015 will move from the Shanghai New International Expo Centre (SNIEC) to the National Exhibition and Convention Centre (NECC), which will remain its venue for the time being. The exhibition space, spanning up to 200,000 sqm, is expected to attract over 2,000 exhibitors and more than 120,000 trade visitors from China and abroad.
3.3.2 Case No. 2
–Intex Shanghai Co., Ltd.
The shareholders are Shanghai Hongqiao E&T Development Zone United Development Co., Ltd., Council for the Promotion of International Trade Shanghai and Istithmar P&O Estates FZE. The company, which owns and operates a smaller exhibition venue in Shanghai, organises exhibitions on its own, and accommodates other exhibitions (http://www.intex-sh.com/en/).
Together with Shanghai International Exhibition Co., Ltd. (SIEC) and Ningbo New Shanghai International Property Management Co., Ltd., INTEX formed a management company in 2003, which was commissioned by the Ningbo Government to run and operate Ningbo International Conference & Exhibition Centre.
–Shanghai International Exhibition Co. Ltd. (SIEC)
Founded by CCPIT, Shanghai branch: In its 30 years in existence, SIEC has organised 580 exhibitions and 22 international conferences covering 105 industries and categories with a total exhibition area of 8,600,000 sqm, 134,000 exhibitors and 21,700,000 visitors (http://www.siec-ccpit.com/en).
–Zhengzhou International Convention and Exhibition Centre (ZZICEC)
Hong Kong – Shanghai Venue Management (Zhengzhou) Limited (VMZL), a private professional management company for Zhengzhou International Convention and Exhibition Centre (ZZICEC), is a joint venture between companies in Hong Kong and Shanghai associated with the Hong Kong Exhibition and Convention Venue Management China Limited and the INTEX Shanghai Company Limited, respectively. VMZL’s Management Agreement is controlled by the Zhengzhou International Convention and Exhibition
Company Limited (ZCL), an entity of the Zhengzhou Municipal Bureau of Commerce (http://www.zzicec.com/en).
3.3.3 Case No. 3
Finally, we come to one of the most outstanding examples, which is hard to replicate.
–Shanghai New International Exhibition Center (SNIEC)
SNIEC is jointly owned by German Exposition Corporation International GmbH, a joint subsidiary of Deutsche Messe AG, Messe Düsseldorf GmbH and Messe München GmbH, and Shanghai Lujiazui Exhibition Development Co., Ltd. This joint venture has become China’s most successful exhibition centre.
SNIEC offers 17 column-free, ground-level exhibition halls, covering 200,000 sqm of indoor space and 100,000 sqm of outdoor space. Since its official opening on 2 November 2001, SNIEC developed rapidly, welcoming more than four million guests annually and hosting around 100 world-class exhibitions. As a multifunctional venue, SNIEC also caters to a diverse range of social and corporate events (http://www.sniec.net).
3.4 Excursion: Exhibition statistics
3.4.1 Metrics and occupancies
The basic key figures when contemplating exhibition centres are:
a.Space sqm: property/construction area – total premises/total floor space of the buildings (above plus, if applicable, under ground level)
b.Space sqm: available – indoor/outdoor. The indoor exhibition space usually corresponds to the overall size of the exhibition halls, and gives an indication of the size and maximum capacity of the venue.
c.Space sqm: utilised by an organiser (gross) – the proportion of space available (b) to accommodate a particular exhibition, i. e. exhibitor stand area, additional special presentations and access, escape routes and service areas.
d.Space sqm: rented (net) – the proportion of utilised space (c) rented by the organiser to exhibitors plus space used for additional presentations. As a rule of thumb, net space equals 50–55 per cent of gross space.
e.Sources in China use the term exhibition space to denote gross utilised space (c).
f.A so-called space turnover factor is sometimes calculated:
Unfortunately, many statistic sources do not define which metrics apply.
Foreign exhibition organisers *) and exhibitors must become accustomed to the conventional Chinese way of indicating the capacity of exhibition halls. The maximum possible rented (net) space (bullet point d) is very often expressed by the total number of standard booths (3 x 3 m = 9 sqm) in the floorplans shown as a grid structure (50–55 per cent of gross space). This does not necessarily mean that stands have a uniform construction, since an exhibitor can rent as much booth space as he wishes to accommodate its individual stand design. However, it makes planning easier.
*) In China, government entities, i. e. ministries or ministry departments, municipal entities, federations, associations, etc. often are called the “organiser” or “co-organiesr”. They usually act as initiators, hosts, sponsors or promoters, whereas planning and operational business is undertaken by professional companies, exhibition management, professional congress organisers (PCO), tour operators or similar enterprises. Since they are closest to the venues, the latter group is defined as the organiser in this essay.
3.4.2 An attempt to match disparate statistics
Today, a number of sources of information and statistics are available about the Chinese exhibition, convention and event market. Unfortunately, however, none of these is comprehensive, meaning that they are not very up-to-date or reliable. Nonetheless, they provide a certain picture, albeit with limited comparability. We therefore leave it up to the reader to decide which source to refer to.
Let us first focus on non-Chinese sources:
The Global Association of the Exhibition Industry – UFI Global Exhibition Industry Statistics March 2014 (figures from 2011/2012)
The report features 1,197 venues (with a minimum of 5,000 sqm indoor exhibition space), operated by 220 UFI members, with a total of 32.6 million sqm available space globally allotted to six regions. However, most venues are small or medium-sized. 689 (58 per cent) of these venues have less than 20,000 sqm exhibition space, 327 (27 per cent) have less than 50,000 sqm, and only 61 (5 per cent) provide more than 100,000 sqm indoor exhibition space (bullet point b).
According to an overview published by the German Association of the German Trade Fair Industry (AUMA) in 2014, these 52 worldwide “giants” featuring more than 100,000 sqm exhibition space include the following in China:
(4) 340,000 sqm China Import & Export Fair (Pazhou) Complex Guangzhou
(13) 204,000 sqm Chongqing International Expo Centre
(17) 200,000 sqm SNIEC Shanghai
(24) 150,000 sqm Wuhan International Expo Centre
(32) 120,000 sqm Yiwu International Expo Centre
(45) 106,800 sqm New China International Exhibition Centre Beijing
(47) 105,200 sqm Shenyang International Exhibition Centre
(48) 105,000 sqm Shenzhen Convention and Exhibition Centre
This list must be updated by adding the National Exhibition and Convention Center Shanghai (NECC), which has 400,000 sqm indoor and 100,000 sqm outdoor exhibition space (partly in operation since 2014, due to be completed in 2015).
Returning to the UFI metrics, the Asia-Pacific region encompasses 15 countries including China, Japan, Singapore, India and Australia. It has 184 exhibition venues spanning 6.6 million sqm exhibition space. China alone has 4.75 million sqm (bullet point b) spread over 101 venues, not all of which are UFI members. In the five years from 2006 to 2011, China’s exhibition space increased by more than 1.5 million sqm, over 1 million on account of newly established venues, and 0.5 million sqm following the extension of existing venues. This was by far the largest expansion in the world. The second largest expansion occurred in the USA, which experienced a moderate increase of approximately 0.35 million sqm.
The net rented space (bullet point d) in the Asia-Pacific region amounts to 21.6 million sqm, 13.7 million sqm of which is located in China. This equals a space turnover factor (bullet point f) of approximately 3. This ratio appears to be small, but only with respect to the incomplete data compilation.
If we take a closer look at the exhibition industry in China, a lot of uncertainties surround the findings. So many facts and figures have been published, but none can really be compared with others. In order to find an informative and reliable solution, we apply a rather simple method. A comparison of five different data sources may provide an up-to-date overview of the scope of the Chinese exhibition venue market, despite not knowing the criteria and decisions behind each source. Even the simplest approach in which each city investigated must have one exhibition venue and must host at least one exhibition (annually) yields considerable differences.
a.UFI mentions Chinese 15 cities with exhibition venues that are UFI members.
b.The German AUMA database is comparatively comprehensive, listing 28 cities in mainland China with 315 exhibitions scheduled for 2015. Of these, 87 are organised by German companies, mainly trade fair companies. One such company, Messe Frankfurt, is the strongest and most widely established German trade fair company in the Chinese exhibition market.
c.The most comprehensive and constantly updated overview can be found on the websites of China Exhibitions.com, a privately operating company based in Hong Kong that covers the exhibition industry in Greater China. This overview presents 41 cities in mainland China that host various types of exhibitions.
d.A similar source, which is not always up-to-date, however, is China-Fairs.com, which features 44 cities.
e.The leading official compilation is published by the CCPIT in their Annual Report on the Chinese Exhibition Economy. This compilation lists exhibitions by host cities and refers strictly to trade exhibitions (B2B) only. The Report 2013 identifies 59 cities where 1,382 exhibitions were held at 104 venues. For promotion reasons, at least one city/venue is mentioned for each province, often listing only one or two exhibitions.
(By comparison, the m+a expodatabase, recognised in Germany, lists 550 trade shows in 46 cities at 131 venues for China.)
If we take the frequency of occurrence of the total of 74 cities registered by the five sources, not necessarily as proof of quality but rather as a position in the market, the well-known exhibition cities are the leaders (in alphabetical order):
–11 cities are listed in all five sources
Beijing, Shanghai and Guangzhou, as well as Chongqing, Dongguan, Nanjing, Ningbo, Tianjin, Yiwu, Shenzhen and Xiamen are among the front-runners.
–Ten cities are listed in four of the five sources
Changchun, Chengdu, Dalian, Foshan/Shunde, Fuzhou, Hangzhou, Qingdao, Suzhou, Xi’an, Yantai
–12 cities are listed in three of the five sources
Changsha, Dongying/Guangrao, Harbin, Hefei, Jinan, Kunshan, Nanning, Shenyang, Taiyuan, Urumqi, Wenzhou, Zhengzhou
–Ten cities are listed in two of the five sources
Guilin, Haiku, Langfang, Nantong, Shaoxing, Tangshan, Taizhou, Wuxi, Zhongshan, Zhuhai
–31 can be found in only one of the five sources (mainly CCPIT) Baotou, Cangzhou, Changzhi, Changzhou, Daqing, Guiyang, Heye, Hohot, Huaian, Jilin, Jingdezhen, Jinjiang, Karamay, Kashi, Kunming, Lanzhou, Lijiang, Linyi, Luoyang, Nanchang, Quanzhou, Sanya, Shantou, Shijiazuang, Weifang, Weihei, Xining, Xinjiang, Xuzhou, Yangjiang, Yongkang
Not one source can claim to be the “one-and-only” comprehensive overview of the Chinese exhibition industry.
In addition, the statistics published recently by China’s Ministry of Commerce paint a very different picture *). For 2013, they listed 7,319 exhibitions, covering 93.91 million sqm exhibition space (an average of 12,830 sqm per exhibition). The top three exhibition heavyweights – Beijing, Shanghai and Guangzhou – hosted a total of 1,696 exhibitions (23 per cent), covering more than 25 million sqm exhibition space (26 per cent).
The surprisingly large number of exhibitions could be due to the fact that many smaller exhibitions are held on the same dates as part of a “main” exhibition, but are counted separately.
The regional allocation is as follows:
EAST (including Province Liaoning, Hebei, Shandong, Jiangsu, Zhejiang, Fujian, Guangdong, Guangxi, Hainan; Municipality Beijing, Tianjin and Shanghai)
| 5,034 exhibitions (69 per cent) | 65,940,200 sqm exhibition space (70 per cent) |
minus the above top three
| 3,338 exhibitions (46 per cent) | 40,940,200 sqm exhibition space (44 per cent) |
MIDDLE (including Province Shanxi, Inner Mongolia, Jilin, Heilongjiang, Anhui, Jiangxi, Henan, Hunan and Hubei)
| 1,083 exhibitions (15 per cent) | 14,565,100 sqm exhibition space (16 per cent) |
WEST (including Province Shanxi, Gansu, Qinghai, Ningxia, Xinjiang, Sichuan, Yunnan, Guizhou, Tibet and Municipality Chongqing)
| 1,201 exhibitions (16 per cent) | 13,413,800 sqm exhibition space (14 per cent) |
*) The author owes this information to Dr. Ding Ye of SUIBE
If we trace simple indications of the probable occupancy of related exhibition venues, we discover that the average exhibition space per exhibition is:
13,205 sqm in Beijing
15,050 sqm in Shanghai
17,310 sqm in Guangzhou
12,265 sqm in EAST (the figure is slightly higher for the whole region: 13,100 sqm)
13,450 sqm in MIDDLE
11,170 sqm in WEST
Bearing in mind that such average figures have to be considered with caution, they reflect a remarkable scale. The majority of all registered exhibitions must surely be much smaller.
Just to give an idea: the 2,181 exhibitions published in the UFI Euro Fair Statistics for 2013 used 22.1 million sqm rented space, averaging 9,630 sqm, hence the above-mentioned average dimensions of Chinese exhibitions are realistic.
It is assumed that some 90 exhibitions with more than 100,000 sqm exhibition space have been held so far.
The following conclusions can be drawn from the facts and figures outlined above:
–The statistical sources about the Chinese exhibition industry differ or overlap only partially
–The more exhibitions and space involved, the more confusing the findings are. This could be due to the fact that UFI statistics include areas as small as 5,000 sqm, which do not really reflect the impact of the industry
–Exhibition space alone has limited relevance. The more essential driver of further development is how strongly the exhibition theme is embedded in the related industry of exhibitors and buyers, and the exhibition’s level of prestige.
–Although most Chinese venues call themselves “international”, they do not really seem to be so yet because their international significance has so far not been proven
–exhibitionsSince there are so many exhibition venues (of all kinds) in China, it is advisable to differentiate between destinations and venues and to group them, for example, by taking the above-mentioned occurrence as first-tier (5 out of 5), second-tier (4 out of 5) and third-tier (3 out of 5) exhibition cities with their leading venues. This does not prevent the remaining destinations and venues from having potential, and provides better orientation on the market as a whole.
4 Convention centres
The most common type of convention centre is built to accommodate bigger assemblies of organisations, associations and societies. Events hosted there last between one and several days; they often take place annually at the same centre or rotate between national or international sites.
Characteristic features are:
–The majority are multipurpose and multilayer buildings
–One grand auditorium/theatre (flat floor or tiered; fixed or movable seats; build-in stage; a movable podium)
–A large number of meeting rooms (preferably with a flexible set-up) of varying sizes or capacities (“break-out rooms”)
–Exhibition space (mainly for industry exhibitions and poster displays accompanying conventions)
–Public amenities (ticket sales, information desk, cloakrooms, restrooms, meeting point, cash dispenser, telephone box, first aid, service facilities, facilities for the disabled, etc.)
In Germany/Europe, most leading convention centres are incorporated in well-known exhibition companies, and buildings are adjacent to the exhibition halls (Congress Centrum Hamburg, CCH; International Congress Centre Munich).
A few convention centres are independent stand-alone buildings in the city centre, which have their own management and organisational structure. These include:
m:con Congress Centre Rosengarten Mannheim, Germany; Hannover Congress Centrum, HCC, Germany; Edinburgh International Conference Centre EICC, Edinburgh, United Kingdom; Walter E. Washington Convention Centre, Washington, D.C.; Moscone Center, San Francisco.
So far, the only Chinese venue that matches this type of convention centre is the China National Convention Centre in Beijing (CNCC). It is the only Chinese member of the highly ranked and recognised International Association of Convention Centres (AIPC). The significant shortcoming of the other venues is their lack of sufficient break-out rooms that are large enough to host major conventions and meetings.
In the USA, Canada, Australia and many other countries around the globe, these venues are called Convention & Exhibition Centres (widespread in China). They feature an architectural and functional combination of large convention facilities (meeting rooms) and ample exhibition space (halls), closely linked together but often operated separately according to the different events taking place simultaneously. Examples include:
McCORMICK Place, Chicago; the new International Convention Centre Sydney (set to open in December 2016); Shanghai World Expo Exhibition and Convention Centre SWEECC; and Hong Kong Convention and Exhibition Centre HKCEC.
Although many venues in China call themselves Exhibition and Convention Centres (or something similar), the relevant parts of the construction area can usually only accommodate smaller or medium-sized conventions and meetings, rendering it impossible for them to compete in the international convention business.
Hotels providing accommodation and facilities for a wide range of different events are tailored to particular needs. Smaller hotels focus on conferences, meetings and seminars (so-called Conference Hotels). Larger hotels – whether city or resort hotels – feature large multifunctional ballrooms, a large number of meeting rooms and even ample exhibition space, making them strong competitors for classic Convention & Exhibition Centres. Examples include:
ESTREL Berlin, Germany; Mandalay Bay, Las Vegas, Nev.; Oriental Riverside Hotel/Shanghai International Convention Centre SHICC, Shanghai Everbright Convention and Exhibition Centre SECEC.
The convention and meetings industry in China is developing rapidly, and seems to be sound. Scientific associations, primarily in the medical and healthcare field, are the most important prospects for conventions as initiator or organiser, with their members representing the bulk of attendees. The more Chinese associations emerge, the greater their chances are of staging big conventions at the national and international level.
Although China’s position on the global market is relatively good, it still has a long way to go to catch up with other countries. This is reflected in the ICCA Statistics Report. Published annually by the International Congress and Convention Association (ICCA), it is an informative indicator of the global enhancement of the association meetings market. According to strict ICCA definitions, the 2013 issue identified 11,685 regularly occurring association meetings that rotate between at least three countries and are attended by more than 50 delegates. The criterion of rotation fosters competition between countries and cities, but in return offers the opportunity to attract foreign associations to stage their convention there.
The USA ranks No. 1 (829 conventions and meetings), followed by Germany in second place (722) and China in eighth place (340). Beijing leads China’s cities, ranking third in the Asia-Pacific region (after Singapore and Seoul), but is only in 18th place worldwide (105). The other Chinese cities rank as follows: Shanghai 9/29 (72), Hangzhou, Nanjing 30/148 (17), Chengdu, Guangzhou, Wuhan 48/206 (11), Xi’an 52/219 (10), Shenzhen, Suzhou 71/294 (7), Tianjin 79/328 (6) and Hefei 82/371 (5).
We can draw the following conclusions:
–A reasonable number of Chinese cities are already able to provide the venues, hotels and services necessary to host challenging international conventions and meetings
–The cities with an international reputation mentioned as convention and meeting destinations in the ICCA list are also the top exhibition cities in China; both segments of the market obviously have a mutual impact
–The widespread gap between the rank achieved in the Asia-Pacific region and the worldwide list is evidence of the tough competition between countries, cities and venues
–In order to strengthen China’s position as a promising convention and meetings destination, all relevant key players, namely the Convention and Visitors Bureaus (CVB), should pool their strategic and operational marketing and branding activities
5 (Indoor) arenas and (outdoor) stadiums
Arenas were primarily built for sports events, and many still house sports clubs such as ice hockey or basketball clubs as “anchor users” hosting many events. Nowadays, arenas are venues that are able to host almost all types of events for large seated audiences of up to 20,000 people.
In most cases, they are colossal stand-alone buildings with the inside space built in an oval shape with fixed seats surrounding a large flat floor in the centre. Investors and owners are often municipal authorities or private shareholders. The management operates on an individual legal and economic basis. Examples include:
Mercedes-Benz-Arena Berlin; Olympiapark München with indoor and outdoor facilities; Lanxess Arena, Cologne; O2 World London; Palais Omnisports de Paris Bercy, Paris; Madison Square Garden, New York; Staples Centre, Los Angeles.
Many, acting as multifunctional halls, may be part of a large exhibition centre and may be operated by it as a department or subsidiary. Examples include:
Chongqing Yuelai International Convention centre (YLICC) with 1,010 exhibition stands or 25,000 seats, which is part of Chongqing International Expo Centre (CQExpo); National Exhibition and Convention Centre (NECC), Shanghai/Hongqiao.
Like arenas, stadiums were principally designed for sports events such as baseball, rugby, football or athletics. Some feature a retractable roof that can be closed completely in a short space of time, enabling them to be used like an arena, i. e. they are weatherproof.
Due to their large seating capacity (up to 100,000 people), they are increasingly being used for other events such as concerts (classic, rock and pop music), shows, religious or political assemblies, corporate events and even exhibitions. They are then comparable to arenas, as so-called indoor stadiums. A good example of such a stadium with a comprehensive range of events is the Millennium Stadium in Cardiff (UK), with a seating capacity of 72,500 (www.milleniumstadium.com).
Management’s challenge is to additionally acquire non-sports public events that attract a large number of (paying) guests, enabling the venue to run economically if it is not making a profit. Examples include:
Olympiastadion Berlin; Wembley Stadium, London; National Stadium/ Bird’s Nest, Beijing; Shanghai Stadium; Guangzhou Olympic Stadium; www.worldstadiums.com.
Two big privately owned and operating companies in the USA – Live Nation and AEG Anschutz Entertainment Group – have assumed the management of different types of venue, even worldwide, in addition to their activities as event organisers. AEG has a management portfolio of arenas, convention centres, theatres, stadiums and entertainment districts. As AEG OGDEN, the company manages many different types of venues in the Middle East, the Asia-Pacific Area and Australia.
In China, the MasterCard Centre, Beijing, and the Mercedes-Benz Arena, Shanghai, are managed by AEG. When it started this business in 2010, the management disclosed that the company also “provides design & construction advice to numerous cities in China who are in the process of building arenas, which shall become part of the AEG network in the country.” The first, which went into operation in 2012, was the Zhongshan Centre in Dalian, an 18,000-seat arena with breath-taking architectural design.
The above-mentioned statement continues: “One challenge in China is that the majority of sports fans or entertainment consumers have never experienced a venue like the Mercedes-Benz Arena or the MasterCard Centre. And that’s where AEG is creating real traction, helping its partners connect with the Chinese consumer who is, for the first time, getting the chance to experience major sports and entertainment events on a grand scale.”
However, as is often the case in China, things are evolving rapidly. For example: the almost 18,000 tickets for the only concert in China given by American singer Taylor Swift in May 2014 at the Mercedes-Benz Arena sold out online in just one minute, making it China’s fastest sale ever. Despite depending on active tour operators and the popularity of artists, the rock/pop concert market seems to be the fastest emerging sector in the event industry, offering suitable venues great opportunities, but also creating fierce competition.
In the world of sports, things have been put on a promising strategic track recently by the Dalian Wanda Group Co., Ltd. In February 2015, this company, which claims to be China’s largest investor in the cultural and entertainment sectors, acquired Swiss-based Infront Sports & Media AG, the world’s most respected sports marketing agency. With this 1.2 billion USD acquisition, it is expected to obtain great support in its bidding attempts to gain major international sports events, from which sports venues in China will undoubtedly benefit.
Due to their ability to host audiences of up to 25,000 and more than 50,000 people, respectively, (indoor) arenas and (outdoor) stadiums will undoubtedly play a major role in the future. Sports, music and entertainment LIFE (!) is an experience that cannot be replaced by other media, radio, TV, DVD or social networks. Be it Chinese stars such as Fay Wong and Chris Lee or the Japanese group ARASHI, the Rolling Stones or Justin Bieber (with VIP FAN package tickets costing 8,888 yuan for his concert at the Mercedes-Benz Arena in Shanghai, 2013), to name but a few, people love them and want to be as close to them as possible. Maybe even Germany’s shooting star, singer Helene Fischer, who on her stadium tour in 2015 is going to perform 21 concerts in 16 stadiums (with an estimated total audience of about 1 million), will also attract an audience in China soon, requiring appropriate venues.
6 Performing arts centres: theatres, opera houses and concert halls
While these venues used to be strictly used in line with their purpose – performances and music – they are now increasingly becoming places for staging a variety of assemblies, entertainment and even marketing events. Examples include:
Wiener Staatsoper (Vienna State Opera); Metropolitan Opera, New York; and Sydney Opera House.
Surprisingly, new performing arts centres are emerging throughout China. In Shanghai, featuring numerous theatres and concert halls, the Shanghai Grand Theatre has already become a landmark, complemented by the Shanghai Oriental Art Centre in Pudong New Area. In October 2014, the brand-new Shanghai Symphonic Hall was opened, giving a home to the renowned Shanghai Symphonic Orchestra.
The spectacular China National Center for the Performing Arts (NCPA) opened in the capital Beijing in 2008. It is a multifunctional building with a 2,398-seat Opera House, a Concert Hall (2,019 seats), a Theatre (1,035 seats), a smaller hall (556 seats) a Fine Arts Gallery, and a large number of amenities for visitors, including restaurants, cafés and souvenir and arts shops.
In the first three years of its existence, NCPA staged 5,274 performances and shows involving almost 120,000 artists from all over the world, and attracting a total of 2,678 million visitors.
Advocating the core value of “arts change life”, in its years of operation, the Centre has created a management model that strikingly demonstrates the current upheaval in performing arts venues: “Implementing brand management strategy, coordinating the relationship between art and business, providing professional and refined management and technical support, and providing personalized services, focusing on the different needs of the theatre troupes, artists and the audience.”
Other cities in China also boast eye-catching venues with professional management. Examples include the Chongqing Grand Theatre, Dalian Development Zone Grand Theatre, Tianjin Grand Theatre (designed by German architects gmp), Wuhan Qintai Grand Theatre, and the recently inaugurated Guangzhou Opera House, designed by the acclaimed architect Zaha Hadid, to name but a few.
China’s educated population takes great interest in classical music and performances, such as operas, ballet, concerts and recitals. One of the essentials of a vibrant music scene is the initiative of international performing arts agencies, like Wu Promotion in Beijing. Founded as a private company in 1991, it has become one of China’s top performing arts promoters and event organisers, striving to enhance cultural exchange between China and foreign countries. In addition to organising 500 concerts in 20 foreign countries, the company has organised more than 3,000 concerts, recitals, performances and shows touring in excess of 30 cities in China. A large number of different venues was involved, giving citizens manifold opportunities to meet world renowned artists and to familiarise themselves with the world’s classical and contemporary music.
7 Special event locations (unique venues)
In order to complete the list of event venues, other types should also be mentioned briefly.
Built for a particular purpose but also available for events (of any kind), this type of venue covers facilities/locations where a number of people (up to 100,000) can assemble to attend an event. A great variety of indoor and outdoor (open air) venues can be identified, such as universities/colleges, town halls, iconic buildings, movie theatres, museums/art galleries, shopping malls, (abandoned) industrial plants, train stations and airport terminals, to name but a few.
These unique venues are very often handpicked by event organisers with regard to the architecture and spectacular ambience matching the profile and orchestration of the particular event, especially in the field of marketing events.
Ancient ruins, urban spaces, streets, parks, bridges, beaches and lakes (with the stage built in the water like at Bregenz Festival, Lake Constance, Austria) serve as open air venues. These often require temporary precautions, particularly technical installations, life safety requirements, security provisions and catering services.
Whereas this part of the event business has developed very strongly in many countries, initiatives in China still seem to be in their infancy, with the exception of a number of music festivals, the City Marathons in Shanghai, Hangzhou and other destinations, and the spectacular Harbin Ice & Snow Sculpture Festival, which attracts ten thousands of spectators. One can easily imagine the meticulous planning and organising efforts of those responsible for smooth operations on a site prepared for temporary use only.
8 General aspects as a résumé
As we opened our essay with the assertion that any event of any kind can take place at a venue of any kind, we can resume at the end of our probe into the Chinese event venue market that this is obviously the case. There is a great variety of different venues as well as numerous events of different types, which match each other.
The global event venue market and the event business on the whole will continue to expand rapidly. Establishing and operating event venues is regarded as making a substantial contribution to the economic, cultural and social development of the community. Exhibition centres are scaled up everywhere, convention centres, arenas, stadiums and performing arts centres are being planned, newly built, expanded or refurbished.
In China, the situation is quite ambivalent. The fastest growth can be seen for trade fair facilities, with the most ambitious Hongqiao National Conference & Exhibition Centre (due to open in April 2015), which will rival in size the world’s previously largest fair grounds of Deutsche Messe AG in Hannover, Germany. Due to the overcapacity of a number of exhibition venues, some market observers are already warning against long-term nonprofitability. They probably disregard the fact that exhibition space may not be keeping pace with demand, but the latter could gain momentum in the future. Compared to the USA, China’s exhibition industry is by no means mature – some challenges and opportunities remain before a solid profitable development can be achieved.
In order to boost the development of the exhibition industry, the State Council released guidelines for guaranteeing more market liberalisation in April 2015. A ministerial joint conference to be established is to coordinate the prospective market rules to be implemented by 2020. The central government plans to step back, giving greater influence to provincial-level authorities and private companies. The big national exhibition companies should be guided to acquire, merge with or buy stakes in foreign counterparts to establish multinationals. Smaller exhibition companies are to benefit from tax breaks and streamlined customs procedures to facilitate cross-border exhibitions. Furthermore, government plans include supporting exhibitionrelated industries such as transport, logistics, telecommunications, finance, tourism, catering and hotels. In order to lure global brand giants into taking part in exhibitions in China, the government promises to strengthen intellectual property rights protection to prevent massive counterfeiting. By taking these measurements, China seeks to become an exhibition centre “with a sound development environment and a high level of internationalization”, which will be bound to affect exhibition venues, too (Shanghai Daily, 20 April 2015).
Although the convention and meetings industry in China is emerging rapidly, only the China National Convention Centre in Beijing can truly be regarded as being globally competitive as far as the size of the facility, the infrastructure and the professional services are concerned. Shanghai, which also operates successfully in the convention market, and other cities are still lacking in a similar venue. As far as the number of delegates is concerned, therefore, the size of potential national and international conventions will be limited.
The target groups and key clients of event venues to generate business are essentially the same. Event venues are differentiated according to their owners’ individual objectives and policies, i. e. the local or national authorities, and the respective management.
–Exhibition organisers
–Convention and meeting organisers (PCOs, national or international associations, NGOs, NPOs, as well as the Government and, on a global level, organisations such as the UN, UNESCO and WHO)
–Corporate and incentive planners
–Concert agencies and tour organisers
–Decision-makers of national/international sports competitions, tournaments and championships
–The public as potential visitors, attendees and participants
–All important stakeholders, the media and other opinion-leaders
An intricate key to positioning a venue in the event market is a compelling favourable image, which is very much influenced by the destination. In this respect, cities, regions and nations are enhancing and strengthening their marketing initiatives. They all are active in a market of tough global competition. The intriguing question is: How can a positive appealing image and a strong market position of a destination in the event market be developed? In many cases, it turns out to be a long-lasting mutually affecting process with numerous creative and strongly backed initiatives by all parties involved. From a marketing perspective, it is similar to the branding of products or services.
The key to success has always been to monitor the ever-changing requirements of the market, i. e. clients and environmental factors, and to find the appropriate measures for meeting them, preferably in advance. The range of event-related marketing activities, tools and services are vast, but manageable. Since the internet is one of the most preferred instruments for a potential prospect to gather information, destination marketing entities and event venues should also offer their websites in non-Chinese languages, at least in English, including floorplans, seating plans, downloads of technical services, online ticketing, and so on. A number of Chinese event venues already have an excellent website, but a surprisingly large number of venues are struggling to keep abreast of the times.
The Chinese event industry undoubtedly has great prospects ahead, in spite of uncertainties about the development of the economy, e-commerce, government policies, society, the standard of living and lifestyle in China, open or latent global crises, threats and weaknesses inherent to the system, internal management proficiency, finance, HR, compliance rules, environmental challenges, and so on.
9 Literature
All facts and figures referred to in this essay were taken from sources retrieved from the internet in February/March 2015 (English version of the websites).
Trade Fair Data Worldwide/Messemarkt China www.ccpit.org.cn
2013 Annual Report on China’s Exhibition and Convention Industry (released at the annual meeting of CEFCO China Expo Forum for International Cooperation)
Trade Shows and Events in China http://www.china-fairs.com/
Trade Fairs and International Exhibitions in China www.researchandmarkets.com
Research Report on China Convention & Exhibition Industry, 2013–2017
UFI 2014 Exhibition Industry Statistics;
UFI World Map of Exhibition Venues
Useful information about general aspects of event venue management:
Kirchgeorg, Manfred; Giese, Wilhelm; Dornscheidt, Werner; Stoeck, Norbert (2006): Trade Show Management: Planning, Implementing and Controlling of Trade Shows, Conventions and Events. Wiesbaden (Germany)
Lawson, Fred (2000): Congress, Convention and Exhibition Facilities: Planning, Design and Management, Oxford, United Kingdom, (Architectural Press)
Mahoney, Kimberley; Esckilsen, Lee A.; Jeralds, Adonis; Camp, Steve (2015): Public Assembly Venue Management – Sports, Entertainment, Meeting, and Convention Venues. Textbook published by the International Association of Venue Managers, Coppell, TX, USA (www.iavm.org)
Petersen, David C. (1997): Sports, Convention, and Entertainment Facilities, 2nd edition, Washington, D.C.