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Why the Big Events Still Matter

by Joshua Greenbaum

July 10, 2009

In this economy, the face-to-face interactions, training, guidance, and advice found at trade shows and events for the SAP community are actually more important than ever. Joshua Greenbaum shares his post-SAPPHIRE musings and explores some surprising trends in who is attending — and why. With budgets and IT decision making under such close scrutiny, what is the impact on attendees’ interactions with fellow customers and the broader SAP community?
 

One of the major questions at SAP last winter, as the economy melted down and doom and gloom settled in, was whether it made any sense to hold the big annual SAPPHIRE user conference in Orlando. The questioning was such that an early decision had already been made to shut down SAPPHIRE Europe in favor of a series of smaller, local events, but the bigger question about SAPPHIRE 2009 Orlando in May remained unresolved.

And then an unexpected thing started to happen: Customers started to register for SAPPHIRE Orlando in quantities that tracked registration rates from previous years. As the run-up to this event gathered steam, it became obvious that the new economic climate wasn’t going to affect the enterprise software market the same way it has devastated other sectors of the economy. This wasn’t just an SAP phenomenon. SAP Insider conferences — including the SAP NetWeaver/BI & Portals conference and the SAP Financials event — report a similar experience.

Shifting Attendee Profiles

Despite the early registrations, giving the green light to a full-fledged SAPPHIRE show didn’t mean that all bets were off. And when one of the senior executives in charge of SAPPHIRE walked into the wrong part of the massive Orange County Convention Center on opening day and saw a vast expanse completely devoid of attendees, for a split second the worst-case scenario of all worst-case scenarios looked like it might actually be taking place.

Luckily for the cardiac health of the executive involved, and the SAP community in general, some 10,000 attendees were gathered in the other half of the convention center. And 8,000 more people were registered for an online, virtual trade show that SAP was hoping would keep those who couldn’t afford to fly to Orlando in touch with SAP’s latest products and plans.

Then things got really interesting. As the show progressed through the week and presentations and parties came and went, the scuttlebutt about a “decent” show turned into a regular drumbeat of positive activity. It turned out that the customers who could find the budget and time to come to Orlando did so not to take the kids to see Mickey Mouse and Pluto — which was a common rationale for attendance in the boom years — but because there was a specific business or technical problem on the table that needed to be solved. And if these customers could find a solution at SAPPHIRE, they were authorized to start the buying process.

This made the relative year-to-year drop in attendance look very different. While SAPPHIRE Orlando drew one-third fewer attendees in 2009 than the previous year, those who did attend had a specific purpose in mind for coming, and that purpose made it possible to justify the trip. Arguably, the drop in the overall number of attendees was offset by the increase in the value of attending for those who did make it. From the standpoint of SAP’s partners and SAP itself, this meant that the cost of SAPPHIRE was well justified based on the conference’s net positive impact on the pipeline.

Going for Face Time…

Based on my conversations with customers, SAP’s pipeline dreams had a strong basis in reality. Customer after customer told me about a key decision point at the company that required in-depth research, the kind that is best done person-to-person at a “classic” big trade show.

And here’s the bottom line for all this activity in the midst of one of the worst recessions in our lifetimes: when millions of corporate dollars are at stake, it’s still a good idea to meet up in person, kick some tires, schmooze with your fellow customers, and otherwise see and be seen at a major trade show for the SAP market.

This wasn’t just a phenomenon for SAP customer events, by the way. I also attended a conference earlier in the year for Microsoft, and the independent Oracle user group hosted an event in Orlando the week before SAPPHIRE. In all cases, the outcome was similar to the results found at SAPPHIRE and the SAP Insider conferences: while there were fewer customers, a higher percentage of them were ready to buy — or at least engage in some serious conversations about buying.

... and Going Virtual

The unexpected success of the old model — based on a gathering of the customer base in Orlando — was, ironically, paralleled by the similarly unexpected success of the new model: an online, virtual trade show. This model, which was also launched this year for the SAP Insider conferences, broadens the base of potential attendees. SAPPHIRE Online, in terms of registrations, made the combined virtual and “reality-based” conference a bigger hit than any previous SAPPHIRE.

A virtual show has two important effects. It provides a valuable, real-time connection to the conference experience for the travel- and budget-challenged who want to see and hear the latest at these events without making the pilgrimage. And it helps those who missed the conference — but see something they like — to start making their case for going to the next show.

Can Less Be More?

Ironically, you almost have to wonder if the de facto limit to attendance caused by the recession was possibly the best thing that could have happened to events like SAPPHIRE and similar conferences. The lower attendance of less focused and less ready-to-buy customers and prospects helped provide a greater focus to the wheeling and dealing at these events because those not really ready to buy weren’t getting in the way of those who were.

I’ve always wondered, with 20-plus years of attending giant industry trade shows and conferences under my belt, if less might not be more. While the tendency has always been toward creating bigger and bigger events, largely due to economies of scale, it may be that super-sizing conferences isn’t always in everyone’s interest.

And that’s not just SAP’s interest I’m talking about. My conversations with customers at this year’s downscaled SAPPHIRE revealed a similar thinking: Many attendees said they were getting more access and more focus from SAP than ever before. Of course, the initial low expectations backfired on some units of SAP — there were several that sent relatively few from their sales and marketing teams to SAPPHIRE, only to find that they were short the necessary staff to meet all the attendee demands for their time and attention.

Nonetheless, this more-business-as-usual SAPPHIRE made it clear that there’s still a lot that SAP can do to help its customers even — or especially — in an economic downturn. The fact that SAP has been saying this since October is a given, but the fact that customers responded with their T&E dollars — euros, pesos, and yen — says that this opinion isn’t just self-serving vendor speak.

So, it’s a recession, perhaps one of the worst we’ve endured. And yet the success of SAPPHIRE Orlando and the SAP Insider conferences says a lot about the relative impact of the downturn on enterprise software, SAP, and those who toil in this industry. A healthy event full of interested customers doesn’t make the recession go away, but it does help make sense of what the next year — the recovery year that we’re promised — is going to look like. What we all do in the enterprise software space will continue to be important, though a little less so than before.

And, as the example of events like SAPPHIRE 2009 have proven, sometimes less is actually more.

Joshua Greenbaum has over 25 years of experience as a computer programmer, systems and industry analyst, author, and consultant. He spent three years in Europe as an industry analyst and a correspondent for Information Week and other industry publications. Josh regularly consults with leading public and private enterprise software, database, and infrastructure companies, and advises end users on infrastructure and application selection, development, and implementation issues. You can reach him at editor@netweavermagazine.com.

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