Slowdown And IT Expos

2008 has not been a good year across the globe and banking, finance and IT
sectors took the maximum beating in the entire round. With enterprises
tightening their belts and counting their pennies, cost cutting has become the
order of the day.

One of the auxiliary busi­nesses to have borne the brunt of this financial
crisis fallout are the various expositions that were held in the country. So
far, these expos would elicit good response from sponsors, exhibitors and
visitors. But in view of the slowdown, suddenly the interest in expos and trade
fairs is also beginning to die down.

Unenthusiastic response

Most channel expositions were events that were held under the aegis of the
various associations spread throughout the country. Typically most of the local
associations would plan to have their expos from November onwards. One reason
for this was that traditionally the OND quarter was considered to be the most
sluggish one in the industry. Therefore, expos offered channel partners an
additional conduit to increase their business.

But this time around, the response to expos has been fairly unenthusiastic.
Sales across India dipped by 24 percent (Q1-3, FY 2008) on an average. Needless
to say, companies are now holding on to their purse strings and do not want to
invest in any brand building exercises which do not give tangible returns or are
not in sync with their immediate business strategies.

All associations in the country are feeling the heat of the recession and are downsizing what earlier used to be the grandest event of the year for the local channel

Realizing this, two major IT associations in the East, Kolkata's Compass and
IT Association of Orissa (ITAO) have already postponed their expo dates as the
slowdown in the eastern market has become acute. Compass had initially decided
to move ahead with the expo. However, at the latest expo committee meeting, the
association decided to halt the same seeing the gravity of the situation. With
the expected footfall and vendor participation in the expo under stress, the
expo scheduled in December had to be called off.

Commenting on this issue, Pawan Jajodia, President, Compass said, “As
announced earlier, the event was scheduled to be held between December 18 to 21.
It has always been our primary objective to provide a platform for exhibitors to
showcase their latest offerings to the channel as well as the consumer. The
current global economic scenario is very grim and the general market sentiments
are not very positive. Hence, it is the need of the hour to call off the expo at
this stage.”

ITAO too rescheduled its expo dates due to these factors. At the start of
this fiscal year when it had planned the expo it had expected a huge footfall
and drawing a tleast 30 percent profit after the expo. Even as the realities of
slowdown hit home, Orissa was better off as this state is on a positive growth
track than its eastern counterparts. However, sponsors are quite sceptical about
the success of the event despite Orissa's good trade performance, which forced
the association to reconsider the expo dates.

Treading carefully

Looking around them and seeing how the market has not taken warmly to
various expos, associations are now rethinking on their strategies for their in
house events and how to make them successful. Ajay Singla, President, Panipat
Computer Dealers Association (PCDA) stated, “I have been a part of the IT
industry for so many years now but I have never witnessed a recession or slump
in business to this extent. As business is slow, it gives us ample time to
concentrate on association level activities. For the time being, we are
concentrating on solving issues between dealers, service related issues and
other activities that are required to improve the working conditions within
Panipat. We are also planning to hold an IT expo and will be conducting a
general body meeting to discuss the same. However, the above is in the planning
stage as our aim is to attract and educate as many customers as we can.”

The Bhopal association is also planning to hold its expo in January 2009.
Surprisingly this association is upbeat about the response it will get from the
market for this event and is expecting heavy footfall. Commenting on this, Asis
Jain, President, Bhopal IT Association stated, “Every year, the IT retail
segment undergoes a phase of recession starting from November. This year, it is
a bit acute. However, we have still not felt the brunt of recession and the
market is somewhat in a stage of normalcy. We are planning to go ahead with 150
stalls and expect a footfall of about one lakh visitors.”

Similarly, Ghaziabad IT Association (GITA) and Nagpur's IT association, The
Vidharbha Computer Manufacturers & Dealers Welfare Association (VCMDWA) are also
optimistic about their upcoming expo. Speaking on this, Arun Kakkar, President,
GITA said, “The vendors and the channel space are keen on conducting the expo.
It provides an excellent platform for the vendors to showcase their latest
products and boosts the channel space. The retail market is down in the OND
quarter every year, and 2008 is not an exception. We'll carry on the expo with
our own contribution and sponsor funds will go to GITA funds for future
referral.”

Like every year, VCMDWA is going to hold its IT fair in early January and
will be hosting 81 stalls with 24 vendor pavilions. With 50 percent of total
bookings already completed, the dealers in Nagpur are expecting a lot of
business to flow in from March 2009. Admitting that the software market is hit
hard by the recession with sales in this arena falling at a record low, VCMDWA
is of the view that the hardware market will be left unaffected.

However, trying its luck in the sluggish market, Mumbai's Trade Association
of Information Technology (TAIT) has already felt the heat of the recession.
Complaining that participation dropped at its recent expo by 20 percent,
exhibitors claimed that there was inadequate publicity about the event. Only 90
exhibitors attended what was touted as the biggest IT expo in the West with
negligible participation from Chinese and Taiwanese vendors.

Mainly blaming the managerial part in the event, Sushil Gupta of Aztech Tele
System who had participated in the event complained, “I came to know that no
proper invitation was sent to corporate houses and big channel players. Also, no
measures were taken this time to increase end-user awareness.” Similar
sentiments were also echoed by vendor companies which had participated in the
event, but did not want to be quoted.

Cautious optimism

Targeting the SMB sector primarily in the South, Information Technology
Traders Association (ITTA), Puducherry  is coming out with its annual
computer expo, Compex 2009 in January. In the expo, this time, there will be
more vendor participation with the leading vendors showcasing their products
directly while ITTA getting a positive reply from the distributors in helping
the vendors to showcase the products.

Recently, Computers and Media Dealers Association (CMDA) held their annual
expo in Pune to a satisfactory response. Attended by over 1 lakh visitors, the
event hosted 121 stalls, including good vendor partici­pation, according to the
association officials.

Although CMDA did not feel the heat as TAIT did due to the recession, the
global slowdown seems to have got through CMDA also.

Speaking about the event, Shital Nahar, President, CMDA said, “This is our
11th year of the event. The recession, although affecting the metro markets
seems to have left the upcountry untouched. This year, as normal, we had our
normal schedule and had a good footfall. Also, we had nine technical seminars
targeted at the corporate clients.”

There is no way of deducing whether expos in C-class cities fared better than
because the number of likely footfalls expected in both these regions are
different. Even the quality of people who visit vary. But all associations in
the country are feeling the heat of the recession and are downsizing what
earlier used to be the grandest event of the year for the local channel.

Avishek Rakshit

avishekr@cybermedia.co.in

(With inputs from Pooja Sharma and NR Sethuraman)