Commentary

Will Mobile Brands Cut Marketing Budgets After MWC Cancellation?

Coronavirus is a nightmare. Wherever you go, people are talking about it. I was in a meeting yesterday where a bunch of marketing executives were talking about cancelled flights, delayed holiday plans and putting off future business trips.

One of the other topics was whether mobile brands would cut back on marketing to make up for the lack of any new business drummed up in Barcelona this February, although exhibitors will be charged fully for an event that never happened. 

The decision to cancel MWC was pretty much forced upon the show as the big names in tech pulled out. The list of those who refused to send their people reads like a who's who of device manufacturing, networking, social media and marketing.

It raised the question that if those big names aren't there, why would you still want to go? Plus, if they're not prepared to send their people, should we? What position would that leave us in legally if an employee got sick at an event major corporations were avoiding to keep their staff well?

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This brings us to the very thorny issue of what happens next financially. Mobile Marketing has been on the case here, and it would appear that stall holders will not be compensated. It asked the GSMA what would happen to those companies that had forked out for space at the event, flights and hotels but was told the terms and conditions of signing up for the event are clear there is no compensation if it has to be cancelled.

It's a tough line, but perhaps it is understandable. After all, companies can always take out insurance against this kind of eventuality, one would imagine, or maybe they should be prepared to take the fallout of a disease on the chin, which isn't their fault, but isn't the fault of the GSMA either.

In fact, it's still pressing ahead with saying that all companies that cancelled within 120 days of the event -- ie, since news of the virus broke -- will still be liable for 100% of their exhibitor space fees.

Which brings us to the very tricky issue of the GSMA having to decide what to do about its next conference, which as fate would have it is in Shanghai. It also has to decide how it deals with companies that it has no intention of compensating for the 2020 exhibitor space but will no doubt soon be expecting to book for MWC 2021 in Barcelona. 

Apparently a full and more detailed explanation of how it intends to deal with companies who have lost out is due before the end of March.

I would very strongly suggest, and expect, that those who were let down in 2020 will, or should, find themselves getting cut a little slack on 2021 rates. 

The elephant in the room is that the entire industry could find they didn't attend Barcelona in February and, you know what, the industry just kept on ticking over nicely. After getting nothing out their 2020 attendance budget, will they have the funds to attend in 2021?

It's an unknown but from conversations I've been having with marketing and advertising execs, most are gearing up for mobile companies to reduce budget to counteract the effects of forking out for a major conference which, because it didn't happen, led to no new business, leading to sales forecasts and financial planning models to be downwardly revised. 

It's an unknown, but the people to share who would share in the financial hit could well be marketing and advertising executives whose clients suddenly have to get their calculators out to see whether budgets need to be revised.

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