The Globalization of Korean Trade Shows : Challenges from a locally-based exhibition center Jay Hyo Kim, President & CEO, EXCO July 10, 2008

Agenda I. Status quo of Korean Exhibition Industry II. Challenges for Globalization III. Strategies for Globalization : In a perspective of local exhibition center

Status quo of Korean Exhibition Industry

▷ Participation mainly in overseas exhibitions in 70’s ~ 90’s - Export–oriented economy - Concentration on established market and economic hubs (North America, Europe, H.K and Dubai etc.) ◆ Trend of development in Korean Exhibitions Ⅰ. Status quo of Korean Exhibition Industry ▷ Rapid growth in domestic exhibition industry in 2000’s - Expansion of infrastructure ( 6 New centers ) : two more coming - Rapid increasing number of exhibitions (163 exhibitions in 2000 / 354 exhibitions in 2007)

Source : KNTO ‘Status of Global and Korean International Conferences 2003, 2005 Association of Korean Exhibition Industries (2006 statistics only) Ⅰ. Status quo of Korean Exhibition Industry Source : KNTO ‘Status of Global and Korean International Conferences 2003, 2005 ’ Association of Korean Exhibition Industries (2006 statistics only) A year The number of exhibition Review the Previous ShowThe number of exhibition per center (2007) Source : Association of Korean Exhibition Industries (2007 statistics only)

- Scale of Korea’s indoor exhibition space, 160,000 s/m in total : 28th in the world ◆ Underachievement of globalization in Exhibition Industry Status of World Exhibitions by Country, 2006 RankingCountry Scale of Center (1,000S/M) World Share (%) 1U.S.A6,13022% 2Germany3,11311% 3China2,5179% 4Italy2,1058% 5France2,0067% …… 28Korea1600.6% Status of Asia Exhibitions by Country, 2006 RankingCountry Scale of Center Utility(times) 1China2,423(62%)2.1 2Japan405(10%)5.4 3India244(6.3%)2.2 4Thailand199(4.3%)1.9 5Korea166 (4.3%) 3.1 6H.K132(3.4%)5.9 7Singapore124(3.2%)1.6 8Taiwan96(2.5%)4.3 - Korea’s Exhibitions occupy middle levels of the Exhibition Industry in Asia - Higher utilization of space : H.K, Japan, Korea Ⅰ. Status quo of Korean Exhibition Industry Rented Space 5,089(47.1%) 2,174(20.1%) 526(4.8%) 381(3.5%) 528(4.9%) 776(7.2%) 202(1.9%) 410(3.8%) 1,000 S/M (Share)

◆ Fierce competition in Korea’s exhibition industry (* ) KINTEX started its operation in 2005 Percentage of Exhibitions held in Convention Centers - 9 exhibition centers in Korea - Number of exhibitions : 354 in Overlapping exhibitions, ‘Me-too’ shows - Difficulties in developing locally-based exhibition Ⅰ. Status quo of Korean Exhibition Industry

Challenges for Globalization

◆ Trend of exhibition industry in Asia - GDP Growth > IMF advanced economy - Not one single market - Strong growth in capacity and number of shows - More capacity additions to come - Many non-competing regional markets - New entrants soaring in the market - New business models -Attraction from international organizers Ⅱ. Challenges for Globalization (J.Witt, UFI)

▷ Holding mainly small & medium sized exhibitions in Korea - 19 exhibitions among 354 over 20,000sqm in 2007 (cf. 676 among 15,000 in the world) - 17 UFI-endorsed exhibitions (China 66, Germany 108) Exhibitions over 20,000 sqm. abroad (2004) Exhibitions over 20,000 sqm in Korea Ⅱ. Challenges for Globalization ◆ Tasks of the Korean Exhibition Industry

Gyeonggi Prov. 11% Daegu 11% Gwangju 4.8% Daejeon 3.4% % Busan 10.4% % of Exhibitions held in Seoul & Gyeonggi % Seoul 53% Source : Association of Korean Exhibition Industries ( 2004~2007 statistics only) ▷ Concentration of exhibitions in the Capital Area (Seoul & Gyeonggi Province) - Many similar shows due to excessive competition - Difficulties in developing specialized exhibitions locally, linked to local industries Ⅱ. Challenges for Globalization ◆ Tasks of the Korean Exhibition Industry

Strategies for Globalization

◆ Encouraging Regional Trade Show to National & International Trade Show - Status quo : ratio of regional show in locally-based exhibition centers up to 70% * Should be 50:50 ◆ Cohesive cooperation in dynamic Asian exhibition industry - Mutual cooperation of Big 5 (China, Japan, India, Hong Kong, and Korea) - Networking, cross participation and support, co-organization, etc. * Export of exhibition brand into the other regions Ⅲ. Strategies for Globalization

◆ Improve the brand power of Korean exhibitions - Strengthening partnerships - Increasing the number of exhibitors & buyers ◆ Train exhibition experts ◆ Raise funds from local government ◆ Attract overseas investment : M&A Ⅲ. Strategies for Globalization

Success Case : Daegu Int’l Green Energy Expo Organized by EXCO

◆ Fact Sheet - Participation of top 20 global companies (Sharp, Q-cells, DuPont, SIMENS etc.) exhibitors, 478 booths from 15 countries - 25,219 professional visitors from 31 countries - 40 sessions of International Conference, Seminar ▪ Review the previous show ▪ Oversea exhibitors Ⅳ. Success Case □ Daegu Int’l Green Energy Expo

◆ International business networking - Partnership with Germany's Federal Ministry of Economics and Technology - A number of overseas exhibitors & buyers - Organizing international conferences linked to associations and institutes - Bartering a booth with international exhibitions CountryClassificationOrganization GermanyGovernmentGermany's Federal Ministry of Economics and Technology, N.R.W (North Rhine-Westphalia) InstituteISES (International solar Energy Society) AgentREECO ChinaInstituteShanghai New Energy Industry Association, Shanghai Lead Exhibition, AgentTop Land, BCO JapanInstituteNEDO ThailandGovernmentNational Science and Technology Development Agency ▪ Strategic networking with international organizations Ⅳ. Success Case

◆ International Marketing - PR & Advertising on international magazines : Photon-International, Sun & Wind Energy, Renewable Energy * Photon-Int’l : Selected Top 24 together with ‘Green Energy Expo’ among 300 similar of its kind exhibitions World wide - Promotion at international exhibitions : InterSolar in Germany, GENERA in Spain, PV EXPO in Japan - On-line marketing by e-newsletter and official website - Sponsorship by global companies : SunPower, DuPont,Suntech, Yingli, Q-Cell etc. Ⅳ. Success Case

◆ Specializing locally-based exhibitions - Daegu is well-known as the most representative Solar City in Korea - International Solar Cities Congress 2004 in Daegu - Largest solar cell manufacturer located in Daegu (e.g. Millinet Solar) - Numbers of solar projects in Daegu and Gyeongsangbuk-Do (Solar Canopy Project, East Coast E-cluster project. etc.) Ⅳ. Success Case

Thank you.