Selling services by creating trust. An empirical study in the German Trade fair Market

Abstract

Although trade fairs are one of the most used marketing tools in business-to-business marketing, they are not well researched. Due to its geographical location and its economic importance, the German trade fair market is considered one of the most, if not the most important, exhibition place worldwide. With numerous national and international trade fairs for a vast variety of industries, German trade fair organizers draw thousands of exhibitors and millions of visitors to their fairgrounds in Germany. While the core business of the German trade fair organizers is to sell exhibition space to the exhibiting companies, they also offer and sell a wide range of services, accompanying the participation in a trade fair. Different categories of services are offered. Some of the services are mandatory and therefore, the exhibitors need to acquire them from the trade fair organizing company. Other services might be necessary to realize the exhibitors’ plans regarding the participation, yet do not need to be ordered and purchased from the trade fair organizer but can also be arranged through third parties, meaning external service suppliers. Although German trade fair organizing companies have made an effort to promote their service offers more effectively with different marketing activities, sales have not met the desired targets. The question arises how sales can be increased. Services are immaterial goods. They cannot be touched, seen or experienced before the purchase. Thus, potential customers might face the difficulty of deciding on the right service provider. Services contain an enormous share of credence qualities. Consequently, people, relationships, and intangible assets receive a high importance in the process of deciding on a service provider. German trade fair organizing companies have to deal with these obstacles. They face the supplementary difficulty of acting in international business-to-business work relationships when trying to sell their services. Previous research on service marketing and business relationships has discovered the importance of trust in order to build strong business relationships with customers and to increase service sales. However, no generally valid results on the determinants creating this trust or the trust-building communication with the customer have been discovered. They seem to vary between industries and thus, need to be analyzed for the German trade fair market specifically. So, based on the literature review on the topics of service marketing, business-to-business marketing, the analysis of the principal-agent approach as well as the current state of trust research, empirical research has been carried out on the topic of selling services more effectively by creating trust. Two exemplary industries (medical and glass manufacturing industries) exhibiting on German fairgrounds were chosen for the survey. The results show that exhibitors on German fairgrounds experience an information asymmetry between a service provider and a customer. They show a desire for long-lasting business relationships and consider trust as an essential part of them. When analyzing the determinants forming trust, the aspects of communication between the service provider and his customer, reliability, and honesty are most important. The service provider should show commitment, offer correct information and be a partner also in difficult situations when communicating with his customers. While these aspects seem generally important to all exhibitors, differences between subgroups based on cultural background, ordered stand size as well as the exhibitor status could be detected. Moreover, the detailed results cannot simply be transferred from one exhibiting industry to the next. Therefore, based on the German trade fair market, trust can be considered essential when selling services. Furthermore, ways of how to build and maintain this trust have been discovered. However, the presented survey detected also a need to examine each exhibiting industry in detail, considering the dissimilarity of the exhibitors per industry segment. Only then, trade fair organizers can ensure a trust-building communication and trustful business relationship between them and their customer for selling services more successful in the future.