Showdown in Chicago

A tale of two collectibles shows

By Meredith Schwartz -- Gifts & Decorative Accessories, 10/1/2000

The International Collectible Exposition (ICE) began life as a small collectibles show held in South Bend, Indiana, in 1974. Over the years, the show grew and changed with the industry. In 1978, the Collectible and Platemakers Guild, Chicago, the industry association of limited-edition contemporary collectible manufacturers, stopped holding its own shows in New York and Los Angeles, and instead endorsed the ICE and held its annual meeting there. Now, the Guild has withdrawn its long-standing endorsement from the ICE, which takes place in Rosemont, June 28-July 1, 2001, and has instead given its blessing to a new show called Collectors' Festival 2001, running June 14-17, 2001, at Chicago's Navy Pier.

The question on everyone's lips is: Why? At a time when trade show attendance is dropping across the gift and home industries, and the collectibles market in particular is soft, why is our industry adding a show only a few days and a few miles from Rosemont? And what impact will it have on exhibitors, retailers, and collectors?

Both Krause Publications, Iola, Wisconsin, which manages the ICE, and the Guild have taken great pains to keep the tone of their communications civil and respectful of one another. Nonetheless, it is clear that this parting of the ways is the result of a serious conflict over how the collectible industry's flagship trade show should be run.

The Trouble Begins.

According to the Guild, the problems originated with the previous ICE managing company, McRand International, Lake Forest, Illinois. The Guild leadership felt that the venue of the 1998 Edison, New Jersey, spring regional ICE was inappropriate. The Guild's managing director, Karen Feil, says that "the exhibitor group thinks we can do better than we've been doing these last few years, and the Edison show was really the last straw." So the Guild approached McRand with a list of things that it wanted greater say in, starting with the choice of venue and including such points as an exhibitor lounge and greater booth discounts for Guild members. The Guild wanted the booth discounts both to compensate for the fact that the cost of participation in the show had been increasing and there had not been a corresponding increase in productivity, and to compensate Guild members for shouldering the brunt of the promotions and mailings. The Guild also wanted to receive a licensing fee for its endorsement of the show, which it would put to use promoting collectibles before the major gift shows, in the markets that the ICE does not penetrate. A meeting of the Guild board was called in order to address these issues with show management, but McRand announced at that meeting that it had sold the show to Krause Publications, without consulting with the Guild.

At the time of the purchase, Krause was not aware of the Guild's issues memo, so a meeting between the two parties was scheduled for September 1999. Both sides agree that Krause addressed many of the Guild's concerns at that meeting. Claude Chmiel, producer of the ICE, states that nearly all of the concerns were dealt with-except for a requirement that all exhibitors be Guild members, which Krause felt would be impractical. Chmiel cites the fact that Krause instituted an exhibitor lounge with complimentary beverages; started running a $750,000 ad campaign supporting limited-edition collectibles in its own publications, which reach 3 million collectors a month; and froze booth costs at 1998 levels through the 2001 show. Feil, however, maintains that neither of the Guild's financial issues-the proposed discounts and the licensing fee-was addressed.

Varying Viewpoints

When no answer was forthcoming on these points, the Guild board decided to terminate its contract with Krause in October of 1998, in order to let the company know that the Guild was serious and to encourage Krause to sit down and negotiate. No response was forthcoming, according to Feil, until April of the following year. In the meantime, the Guild began to consider what it would do when the contract's two-year termination clause expired. Offers to run a show for the Guild had been coming in ever since McRand sold the ICE, so the board drew up an 18-point memo of specifications. The requirements included a say in the venue; target numbers for booth prices; some percentage of the revenue to be devoted to local advertising; an exhibitor lounge; and a reduction in the amount of retail selling of event pieces at the show, to make it more dealer-supportive. At its January and April 1999 meetings, the board entertained presentations from companies such as Smith Buckland, Miller Freeman and Collector Communications, and the Dallas Market Center.

Krause was also invited to participate, but, according to Feil, its proposal was the only one that didn't take into account the Guild's parameters. For example, Krause proposed an advertising campaign, but one done exclusively in its own publications, many of which go to knife and coin collectors, rather than the local marketplace. "When we started this out, we never expected to not be working with Krause. [The board members] didn't want to change. It's easier not to change, but they couldn't in good conscience take a proposal that wasn't the best for their members," explained Feil.

Chmiel, on the other hand, tells a different story, stating that Krause was-and remains-bewildered about the reasons for the Guild's departure, and has made repeated, unavailing attempts to negotiate. "We truly don't understand," says Chmiel. "We have always felt that we have always been extremely responsive and forthcoming with the Collectible and Platemakers Guild. If there was some new thing that we could do for the Guild, we would do it. We have made it clear to the Guild that we stand ready to try to meet and resolve this situation, and we have been rebuffed at every turn, in terms of trying to come to some sort of agreement. Most notably, NALED [the National Association of Limited Edition Dealers, a fellow co-sponsor of the ICE] was asked to contact both parties and to see what NALED could do about bringing us together to discuss whatever the issues are. Our response was, any time, any place, anything on the table. The Guild's response was no. We regret being in this position vis-à-vis the Guild, and stand ready to resolve this situation. Our concern is that it can only harm the industry."

A Fresh Start

The Guild board approved the proposal made by Miller Freeman, publisher of Giftware Business, and Collector Communications, publisher of Collector Editions. Although Miller Freeman was recently sold to The Netherlands-based VNU, Feil says that the sale will have no effect on the new show's upcoming debut. According to Feil, the Guild decided to hold the new show in Chicago because it surveyed its membership and found that that was what the members wanted. With the current climate, and in the wake of the Atlanta spring regional ICE, exhibitors were reluctant to try to break into a new market, and the strong Midwestern market has been home to the Guild's show since the 1970s. For the same reason, the Guild decided to abandon the idea of regional shows and return to endorsing a single show per year, at least until the Collectors' Festival's approach begins to bear fruit for exhibitors and makes them more willing to take the risks involved. As for the choice of venue, the Guild initially approached the Donald E. Stephens Convention Center (formerly known as the Rosemont Convention Center), home to the ICE, but according to Feil, the center was unavailable because "Rosemont wants one collectible show." The Guild considered moving back to South Bend, but decided that the industry had outgrown that venue already. Instead, the Guild chose the Navy Pier, which has the additional advantages of being more convenient to the local media and offering "that population of potential collectors out there on the Pier that we could draw on."

One of the Collectors' Festival's key selling points is the addition of the Gift Creations Concepts (GCC) show. GCC, New Brighton, Minnesota, formed a strategic alliance with the Collector's Festival to move its private show from Minneapolis to the Navy Pier, where it will be held on Thursday, June 14, 2001, taking the place of a second retailer day. GCC will also hold private meetings on Wednesday, June 13, 2001, the day before the show opens. After 14 years, GCC is also canceling its March mini show, which used to take place in Chicago, citing the changing buying patterns of its retailers. The catalog group does hold a meeting in conjunction with the Atlanta International Gift & Home Furnishings Market in January. According to GCC CEO Alexis Bighley, GCC expects to bring in some 400 to 600 retail buyers. Bighley estimates that the combined shows will offer two to three times the number of collectibles vendors that the GCC show alone would draw.

Chmiel raises the concern than GCC participation will cause the Collector's Festival to compromise its collectibles focus. Bighley said that the "the gift vendors will be adjacent and available only to our customer base." But Feil says that while the separate area of giftware and other non-collectibles vendors brought in for the GCC event will be torn down before the collector days, it will be "open to everybody on the second retailer day."

Chmiel also says that Krause's research does not support the Guild's take on what is important to exhibitors. According to Chmiel, "our research indicates that retailer buying is the primary concern for only 26 percent of our exhibitors." The top-ranked concerns were collector attendance, at 41 percent, and retailer attendance, at 30 percent. Similarly, while Feil says, "That's always been a big bone of contention," and presents the cut back to a single day for retailers as a positive change, Chmiel reports that 42.6 percent of ICE exhibitors say the ICE should maintain two retailer days. Some 10.6 percent would prefer one and a half retailer days, and 34 percent want only one retailer day. Says Chmiel, "That's a pretty clear mandate to maintain it the way it is." And the GCC show, while it may bring in new business, doesn't serve the existing retailers: Chmiel says that 73 percent of retailers who attend the ICE are not members of a catalog buying group.

A Tradition of Excellence

"I don't think it [losing the Guild's endorsement] will affect Rosemont," says Chmiel. "The research that we have comes from an independent phone survey of collectors following the Rosemont show. And our research indicates that 91 percent of the collectors who were at the show are already planning to attend the 2001 show at Rosemont." In addition, 70 percent of the retailers who attended are already planning to attend Rosemont 2001.

At this past ICE, 26 percent of the retailers were first-time attendees, and 32 percent of the collectors were first-timers. "That's a key statistic," notes Chmiel. "We are bringing new people into this show, and therefore bringing new people into this collecting hobby." Of course, Feil points out that the Guild and the Collectors' Festival show management kept plans for the new show largely under wraps until after the Rosemont ICE 2000, so as not to undermine their final show with Krause.

Krause intends to continue to work with retailers to provide a first-rate seminar program, and to do promotions with retailers. For the entertainment direction of the show, Chmiel plans to continue to book national-level entertainment, such as Bobby Vee and the Lettermen, but doesn't intend to set up a carnival atmosphere or take further advantage of Chicago's tourist attractions. "Collectors come to the show to see new collectibles and to meet the artists. That's their entertainment," he says. Similarly, he feels that retailers want to "see what is new, to have a chance to talk to the key people in the industry, and, most importantly, to see what the collectors say is hot and where the crowds are going." Krause's research supports that view.

"Our understanding is that 99 percent [of the exhibitors] are satisfied," says Chmiel. He stands behind the Rosemont exhibition as it is, and believes that it will continue to fulfill its traditional role in the industry. "Krause Publications has a near[ly] 50-year history of successfully building collectible hobbies. We will continue to bring that expertise and the resources that we have to producing a successful International Collectible Exposition."

An Uncertain Future

What is truly at issue here is not miscommunication or hard feelings, but the fundamental question of what the collectibles industry needs from its primary trade show. The Guild's concern about the growing cost of exhibiting goes beyond booth rates, which Krause has, after all, substantially addressed. The larger question is: How many companies can afford to continue providing bigger and better spectacles at a time when profits are shrinking? Krause stands behind the current model, and cites hard data to prove that all members of the show's clientele-exhibitors, retailers, and collectors-are getting what they want. The Guild, on the other hand, envisions a whole different kind of show, one in which wholesale buying moves to the forefront, and collector days are as much about drawing in curious newcomers as about rewarding dedicated collectors. It remains to be seen whether retailers really will write enough orders for exhibiting at the Collectors' Festival to pay for itself, and, if they do, whether this shift in emphasis will end up shortchanging collector days or breathing new life into them. Will one vision serve the industry better, so that one show replaces the other? Or is there room for both to thrive? It is also possible that neither show will grab enough of the pie to achieve the critical mass that makes for a successful event, and the industry will be left without a major national trade show of its own. Only time will tell.

In the meantime, the key question for retailers is "Who is going to exhibit where?" Retailers will go where their lines are, whether they go to buy, or to bring their customers, or both. Some companies are compromising by exhibiting at both shows, but many cannot afford to do so, or may show at both Midwest expos at the expense of the spring regional ICE. Some companies, like Department 56, have announced that they will go to neither. While it is very early yet, and many collectibles manufacturers are still sitting on the fence about where-or even whether-to show, the sidebar contains a preliminary exhibitor list for each show.