Nick Desai had been planning last week for months, envisioning what some call the Super Bowl of the grocery industry to flaunt his big idea: junk food snacks made from peas, instead of corn.
The chief executive officer of PeaTos hired a hip-hop DJ. He planned to send about 15 staffers and spend more than $100,000 at Natural Products Expo West, a trade show in Anaheim, California, expected to draw nearly 88,000 attendees and 3,700 exhibitors. But last Monday, on the eve of the opening, organizers postponed the event as the coronavirus outbreak deepened in the region.
“When you see the brand, when you see the people, you can quickly get a sense of the energy level and the culture of a company can come across,” Desai said. “It’s almost impossible if you don’t meet them in person.”
The spread of the virus across the U.S. has already caused the scuttling of more than 50 major corporate events with an estimated attendance of 940,000 people, according to data collected by Bloomberg News. Much of the economic impact is obvious. Those attendees aren’t flying, staying in hotels, ordering Ubers and racking up bar tabs on the corporate Amex. In the U.S., spending on business trips rose to $327 billion in 2018—up 22% from five years earlier—in accounting for about 40% of all expenditures, according to the U.S. Travel Association.
What’s harder to calculate is all the missed-opportunity costs. Maybe Desai and his sales team would have inked a new distribution deal for their PeaTos brand? Perhaps a buyer from a major food retailer could have tasted its pea-based classic cheese crunchy curls and bought into Desai’s marketing that pitches the orange snack as a healthier alternative to Cheetos, a category giant made by PepsiCo Inc.’s FritoLay unit.
“So much of what happens at these shows is that one chance interaction that is very difficult to replicate in a non-real life setting,” Desai said. “A lot of it is enjoying your time together, you know, having a cocktail together.”
“If this is more like a six-month thing, we’ll all have to learn new skills.”
As much as the business world has gone digital with video conferencing and Slack channels, there are more conferences and trade shows than ever—just try to find a media company that doesn’t have an events division. Some chalk this up to corporate America already being so much about screen time, making the in-person meeting more valuable.
“Everyone in the industry is at that show,” said Shadi Bakour, CEO of PathWater, a five-year-old company selling water in reusable aluminum bottles, which had inked a sponsorship deal for Expo West. “From lawyers, distributors, retailers and investors to you name it. You can run into someone that can change your entire business just by walking around.”
But what happens if months of the conference schedule are wiped out? Walmart Inc., Ford Motor Co., International Business Machines Corp. and Amazon.com Inc. have already suspended non-essential U.S. business travel to events like trade shows, among many others.