Roll-up, roll-up, the boating show season is once again upon us. Over the next few months, thousands of boating enthusiasts will descend on marinas and exhibition centres across the country, all eager to see (and in some instances, buy) the latest and greatest of what our industry has to offer. For suppliers, retailers and BIA members, these shows offer the perfect avenue to meet potential clients and exhibit new and exciting products and services. However despite the helium balloons and goodie bags, it’s not all fun and games. There are inherent legal risks associated with putting together and running a stall, many of which are often overlooked by organisers.
This time last year I wrote an article in Marine Business discussing exhibitor liabilities and potential pitfalls in trade shows contracts. It touched on issues of accidental damage, event cancelation and insurance policies, and emphasised the importance of understanding and carefully considering all the terms and conditions of a trade show agreement before signing along the dotted line (for anyone interested, the full article can still be found on my website at www.vmlegal.com.au/articles). This year, however, I’d like to focus less on contractual agreements and more on the actual marketing efforts of businesses at these shows. There may be legal questions which arise as a result of potentially misleading or fraudulent promotional materials, breaches of intellectual property rights, or the running of competitions and lotteries.
The Wood Chop: Misleading and Deceptive Conduct
Trade shows can bring out both the best and the worst in people. Beneath the family-friendly carnival-like atmosphere, it is a hectic and potentially hostile business environment. Every year, over four days, the Sydney International Boat Show attracts upwards of 70,000 spectators wandering through the hundreds of exhibits stretched over six halls and a purpose-built marina. Very few marketing ventures involve such direct competition in such close proximity. Among the pressure, hype and showmanship, the line between friendly competition and dishonest business practices may be less than clear. Indeed while goodwill and support is generally strong among boaties, in other larger industries, stories of trade show sabotage are not uncommon.
However organisers maintain the right to immediately remove any party engaging in disorderly or offensive conduct. Exhibitors can protect themselves by ensuring their conduct on the show floor remains above board at all times.
Like any other form of advertising, booths at trade shows must also adhere to consumer protection legislation. Banners, flyers or other promotional goods on display (or handed out) cannot contain information that could reasonably be regarded as deceptive or misleading to the public at large. While this should be familiar territory to anyone in business, it’s worth remembering that the statements of employees may also fall into this category. In particular, questionable pricing tactics may arise on the show floor as sale staffs try to win over the bargain-hunting consumer shopping around for the best deal. Staff must therefore be trained to avoid potentially illegal scenarios. These laws don’t, however, limit an enthusiastic sales pitch. "Advertising puffery" or hyperbolic statements (‘we’re the best in town’) are not prohibited by the legislation, providing they are evidently a subjective opinion and not taken to be the literal truth.
The Sideshow: Scams
In the lead up to the show season over the last couple of years, some exhibitors have reported receiving correspondence from an organisation known as "Expo-Guide". The letter promises a free listing in an "independent and objective" online directory, and requests exhibitors update their pre-registered listing as to ensure the publication of "accurate data". Enclosed with the letter is an official-looking form asking for contact and business details, as well as a postage-paid return envelope.
While at first glance it appears to be required for the free listing, those who carefully read the small print at the bottom of the form will discover the document is actually a legally binding 3-year contract for the publication of a "full-sized insertion" at a cost in excess of $1500 per year. Many who have unwittingly signed up to this “service” are unaware of their mistake until they receive an invoice, followed by a series of letters demanding immediate payment and threatening impeding legal action. This alone is enough to scare some into and simply paying the exorbitant fees, without first questioning the validity of the contracts.
These contracts are at best deceiving, at worst, downright fraudulent. Nevertheless it is a well-established principle of law that you cannot escape contractual obligations simply by pleading ignorance of the small print. And while no business has, to my knowledge, ever been successfully prosecuted by Expo-Guide for their failure to pay, simply making enquiries and responding to the Mexican-based company can be a costly and time-consuming process. Since 2008 many organisations and associations across the globe, including the BIA, have issued general warnings to event participants not to sign up for any unofficial free promotional listing of their stalls. Shady online business will frequently operate under a variety of names and official looking websites. Vigilance and common sense are your best protection against these scammers, and as the old mantra states, "if it looks too good to be true, it probably is".
The Gallery: Intellectual Property
Intellectual property rights are another avenue often overlooked by exhibitors. While event organisers will sometimes try to minimise IP theft by preventing anyone taking photographs on the show floor, it’s a largely meaningless gesture in a world where virtually every mobile phone has an inbuilt camera and internet browser. Exhibitors must work on the assumption that their displays will be made available, not only to show attendees, but indeed to anyone across the world with access to the web.
It therefore goes without saying that businesses should ensure they have protected their innovative, unique and potentially highly profitable ideas and designs before they exhibit to the public. The only way to secure these intellectual property rights is through a process of registration, both domestically with IP Australia, and if operating internationally, the relevant government authorities abroad. Otherwise there may be no legal remedy when imitations and product copycats start hitting the markets in the months that follow.
The Funhouse: Competitions and Lotteries
Finally, many exhibitors also decide to run promotional contests, giveaways or sweepstakes to attract and entice visitors to their stands during the show. While these often prove to be very successful marketing tools, they require some forethought and planning. Any competition which promotes the sale of goods or services is subject to both the terms and conditions of the event, as well as relevant state laws. An exhibitor at the Sydney International Boat Show, for example, must acquire prior written consent from the BIA, as well as apply for a trade promotion lottery permit from NSW Office of Liquor, Gaming and Racing at least 5 days before the intended lottery start date. Depending on the total retail value of the prize, these permits can be a costly exercise, and come with quite restricting conditions. Part of the process requires the applicant formulate a document outlining the rules of the proposed lottery, covering things such as the conditions of entry, closing date, details of prizes and means of notification.
The Main Arena: Showtime!
It’s an exciting time and for many in the industry, the highlight of the working year. The boat shows held in all the capital cities over the coming months represent a large investment for exhibitors, not just in capital, but also in countless hours of organising and planning. Like any investment it doesn’t come without its risks and costs. Some are easily avoided by ensuring compliance with consumer regulation and the adequate training of staff. Others require the exercise of caution and commonsense to avoid losing money in marketing traps. Yet the best course of action and the best protection against foreseeable legal issues, is to be pro-active in understanding and meeting the businesses various legal obligations and requirements when exhibiting at a public trade show. While none of this will be new information for the boating show pros, the take home message for any newcomers in 2011 is to plan your marketing strategies well before show date, and make sure to seek legal advice if you’re uncertain about your legal position at any stage of the process.