Climate World: Drag Race

For several years by now, Climate World Expo remains the main event for the HVAC industry of Russia. The perspectives of the project development, its competitive advantages, and the attempts to catch up with the leader are the topics we will discuss with those directly involved in the organization of the event: Executive Director of Association of the Association of Professional companies in Industry of Climate (APIC), Dmitri Kuzin, and Euroexpo company’s Exhibition Director, Oleg Nikishin.

— Please, tell us why Climate World Exhibition is the main exhibition for the Russian HVAC&R industry?

Oleg Nikishin: To answer this question, no emotions or comparisons are needed – numbers are enough. Thus, Climate World-2010 exhibition covered 15 800 m2, 240 leading HVAC&R companies representing 23 countries of the world participated in it, 15 200 visitors attended the exhibition. The exhibition continues growing even during the crisis. For comparison, in pre-crisis 2007 the area of the exhibition constituted 12 500 m2, the exhibition was attended by 13 500 persons, and the number of participating companies was 228. I don’t think that you’ll be able to name another competing event with similar parameters.

– What differentiates Climate World from other large international exhibitions?

Oleg Nikishin: The main subject of Climate World is the Russian market. However, both in terms of magnitude and composition of participants and visitors, as well as in terms of the scale of the issues discussed, the exhibition is of international nature. Nevertheless, it is not a simple copy of Italian MCE, Chinese China Refrigeration, German Chillventa, or other foreign exhibitions. Our subject is the Russian HVAC&R market.

Our market is one of the world's most perspective markets both in terms of volumes and growth rate. The past summer, I think, will prove it once again. We have our own players, settled rules, traditions, and tasks on the resolution of which the perspectives of further development depend. Those are the subjects of Climate World project.

We promote advanced equipment and technologies. We help foreign manufacturers enter our market and understand its specific character. And we also assist state bodies and business entities in resolving serious issues related to HVAC&R industry. We provide a ground for all participants of the Russian market to meet at, and implement international projects on the Russian territory. We believe that here, in Russia, we should talk about Russia and solve the issues the Russian industry faces.

– What is the composition of the participants and visitors of Climate World?

Oleg Nikishin: Our exhibition has clear B2B – “business-to-business” format. Among comprises participating in the exhibition are: distributors, equipment manufacturers, engineering, installation, and design organizations, branch associations, self-regulated organizations, international environmental organizations, branch mass media. Climate World's visitors are those who make decisions. 53% of them are either owners or administrators of distributor, retail, and engineering companies, construction and installation, and design organizations. 93% of visitors said they were drawn to Climate World by “professional interest”.

– Certainly, one of the reasons to consider Climate World the main Russian HVAC exhibition is the exhibition’s long history?

Oleg Nikishin: Sure. Our exhibition is one of the oldest and most dynamically developing specialized exhibitions within the bounds of Russia. In 2011, Climate World will be held for the 7th time. The resolution on holding HVAC&R equipment exhibition was approved in 2004 at the historical meeting of the Board of Association of Professional Companies in Industry of Climate (APIC) and administration of Euroexpo exhibition company. In 2005, the exhibition successfully started with the area of 5,000 m2. By now, the area of the exhibition and the number of visitors have increased more than 3 times.

– Anyway, what makes it possible for the exhibition to attract new participants and visitors year after year, without losing the old ones?

Oleg Nikishin: Each year we offer new services for participants and guests.

During and after the exhibition we, with the help of our marketing agency and our journalists, through questionnaire surveys and personal communication with leaders, managers, and visitors, clarify shortcomings of the exhibition and receive suggestions for its further development. So, if someone compares Climate World held in 2005 and 2011, he will be able to see that those are two different exhibitions in terms of service and attention paid to the needs of participants and visitors.

During this time we created one of the most successful HVAC websites with more than 8,500 pages. There, we provide detailed information about participants, their products or services. There operates a system for searching for participants by equipment or service; our partners and customers use it actively for their business purposes. Our site operates not just during 3 or 4 days, but throughout the whole year. The whole history and life of the exhibition are publicly accessible: business program presentations for any of the previous years, market analysis, picture galleries and participants’ interviews. In 2011 we are going to add video interviews and video broadcasts, extend the industry news block, enhance mailing for more than 20,000 portal subscribers. Our subscription database includes over 70,000 addresses; those are visitors of previous exhibitions and subscribers for Climate World magazine, APIC’s and HVAC Business School’s corporate mailings.

News of exhibition participants are published free of charge throughout the year in the leading trade magazine Climate World, in other partner publications and at web-portals devoted to HVAC&R industry.

Our project was one of the industry’s first to organize on-line broadcasting of business programme. We are now launching the Contact Center for provincial and foreign companies which cannot not attend the exhibition; there such companies will be able to find a reliable partner among visitors of the exhibition by means of on-line requests and video meetings. Each year we make agreements with leading marketing agencies, governmental bodies, branch associations, SRO, manufacturers and distributors on providing us with the most actual information that can really be useful for the business program. Heads, leading specialists and experts of these organizations are regular participants of our conferences and symposiums.

– Please, give us more details about the business programme of the exhibition.

Oleg Nikishin: Within the framework of the business program of Climate World the most important and topical industry-specific issues are discussed by those who de facto exert an influence on the industry development. In 2011 those will be the issues regarding HCFC phase-out on the territory of the Russian Federation, Russian legislation in the area of energy efficiency and low-voltage equipment, current state and perspectives of HVAC&R market development, activities of self-regulated organizations in the design and construction of engineering systems, development of new standards, branch-specific training and verification for HVAC equipment.

Among participants of the business programme are structures, organizations and branch associations which de facto exert influence on the resolution or elucidation of those issues: United Nations Industrial Development Organization (UNIDO), SRO NP ‘ISZS-Proyekt’ and NP ‘ISZS-Montazh’, APIC, ABOK, leading manufacturers, marketing agencies specializing in HVAC&R industry analysis.

– Could you, please, tell us more about the cooperation between APIC and Euroexpo in the organization of the exhibition?

Oleg Nikishin: The partnership between APIC and Euroexpo is natural and consistent. Whom could the leading industry association cooperate with if not the leader of the Russian exhibition industry? APIC brings together the main enterprises of HVAC industry. The Association founded a leading branch magazine, Business School for training specialists, several web-projects of various purposes, marketing agency and service which helps manufacturers to enter the Russian market. In cooperation with ABOK another association which supports Climate World two SRO joining over 700 companies were established.

Acting in concert, APIC and ABOK – the largest specialized associations in Russia – solve the main industry issues of HVAC&R industry in our country.

In its turn, Euroexpo, Russia’s number one exhibition company, is an organizer of the largest international exhibitions among which are, for example, Sviaz-Expocomm which is attended by highest officials of our country.

– So, as it turns out, Climate World exhibition has no serious competing projects?

Oleg Nikishin: Not at the moment. There are exhibitions of similar subject. For instance, Mosbuild, a large-scale exhibition devoted mainly to the needs of the construction industry. Presently, practically no HVAC&R subjects are presented there. SHK exhibition, which specializes in “plumbing, heating, air-conditioning, and engineering equipment”, pays most attention to the issues of heating, energy efficiency, and corresponding engineering solutions. The basis of the exposition is composed by exhibits of European, mostly German, companies. A traditionally intense and interesting exhibition business programme is organized by ABOK. There is an event called Aqua-Therm – the largest exhibition of equipment for heating, water treatment, water supply and plumbing systems. Mattex exhibition presents complex professional solutions in the field of water supply, gasification, plumbing, heating and control. It is Climate World’s partner project held at the same time with our exhibition in the adjacent pavilion. One of the industry’s best specialized conferences organized by ABOK is “Moscow – an Energy-Efficient City” (MEG). It is attended by representatives of the federal executive authorities, heads of departments and prefectures of Moscow as well as head of regions. It is a serious and good event; however, it is, first of all, a conference.

– By the way, about competitors. You surely know about the document named “A Dozen of Reasons to Participate In “CHILLVENTA RUSSIA2011”?

Dmitri Kuzin: Please, let me answer this question. Yes, several months ago, I had a “pleasure” of getting myself acquainted with this document. And a little later, Kholodilny Business (Refrigeration Business) magazine published an article telling about the successes of European Chillventa which successes, indeed, take place; the article also told about Chillventa Russia becoming a new home for the Russian HVAC&R business.

Telling about the new exhibition, the authors of the article state, first of all, that Chillventa Russia is the same as European Chillventa, but located in Russia. Second, they say that Chillventa Russia is the only exhibition in our country, where the widest range of cooling technologies is presented. Third, the exhibition is told to enjoy support from recognized independent industry experts and professional association both in Russia and abroad. Fourth, with the exhibition taking place two times a year, really new developments and solutions will be presented. And, at last, fifth, the business programme of the exhibition is segmented and covers the most urgent issues related to the technology and equipment.

– And you are saying that it’s not exactly true?

Dmitri Kuzin: Look: Chillventa Russia is undoubtedly different from European Chillventa. The success of the European exhibition cannot just be taken and transferred mechanically to a Russian enterprise. Our market is not rubber, its capacity has certain limits. Climate World exhibition unified all representatives of HVAC&R business who have any meaning at all; those representative are highly unlikely to spend their money, time, and efforts to participate in Chillventa, which takes place concurrently with Climate World. Leadership abroad may have no meaning at all in our country. Foreign “missionaries” should have got used long ago to the fact that we have our own rules, our own settled market and our own traditions. Nobody would even think about coming to the USA and becoming a new ASHRAE. It’s unlikely for anybody to start publishing another Jarn in Japan. However, NürnbergMesse GmbH has repeatedly “conquered” the Russian exhibition market in the field of HVAC&R systems straight forward, claiming to be the main industry exhibition in the country.

In 2009, the event organized by that company, named Kholod-Expo” and taking place in a pavilion adjacent to that of Climate World, simply crashed. Tellingly, for some reason European companies forget about business ethics as soon as they step on the Russian land.

Participants of Kholod-Expo, in their attempts to create some image of activity, visited each other while being watched at with condolence by their colleagues who came to Climate World.

And the result of 2011 is unlikely to be much better. Chances are that things will only get worse, because this time Chillventa Russia and Climate World will take place at the same time, however, at different grounds.

– And what about the statement that Chillventa is Russia’s only exhibition where cooling equipment and related technologies are presented?

Dmitri Kuzin: Well, this statement seems so tender in its naive directness. What market are you talking about, ladies and gentlemen? In Russia, in each city air-conditioners and cooling equipment had been installed long ago, as well as the heating has been operating. Even if we don’t take into consideration the main industry exhibition, Climate World (and organizers of Chillventa Russia seem to think that there is no such an exhibition), we successfully hold events which Oleg has already told about. Those are ABOK’s conference “Moscow – an Energy-Efficient City” (MEG), SHK which has been for many years specializing in the technological aspects of engineering systems, and many other conferences and exhibitions. So, what new can Chillventa tell us?

– What about the support from industry experts and communities which Chillventa’s organizers talk about?

Dmitri Kuzin: The weight of the professional associations which indeed support Chillventa, is insignificant in Russia. That is except for those who simply don’t know about the support they are providing. For example, the president of one of the leading industry associations listed in the early issue of the “Dozen Reasons” was surprised to find out that he was supporting that project. There is similar information about some other participants. I think that organizers of Russian Chillventa should treat information more accurately.

– And what about the advantages of holding the exhibition once in two years?

Dmitri Kuzin: Considering the conditions of the dynamic market in Russia, such a periodicity is ideal for the project not to be remembered by anybody. However, two years are enough for inventing and registering a new name and making another attempt to conquer the Russian market. We only could advise not to be so direct next time, and pay more attention to the positioning of the project, terms, and concept. The saddest thing in all this situation is Russian Chillventa’s organizer’s gross ignoring of marketing rules and business practices. We noted three crude errors that, in our point of view, are likely to become fatal for that project.

– What are those mistakes?

Dmitri Kuzin: No 1 rule formulated in numerous works of Jack Trout sounds like this: “Copying of the leader is prohibited”. It is one of the main marketing rules, and many textbooks have been devoted to the sad consequences of breach of this rule.

In Russia, there are several trade HVAC&R exhibitions, with Climate World being the leader for 7 years by now. And practically any director of a large HVAC, refrigeration, or construction company, whatever such director’s personal attitude to the project is, knows that Climate World is the main and, in fact, the only large Russian exhibition event for HVAC&R business. All players attend it, and if they don’t this means that they simply don’t think that exhibitions are important for their business.

And, all of a sudden, there jumps out a guy who says: “Guys, in fact, I am the leader; at my place – far, far from here, – I was a big frog in a small puddle.” “So, why don’t you return to your puddle? We have different rules in our own” – locals would reply. And, in fact, this was exactly what Climate World did. However, unwittingly, because, it seems, Climate World just didn’t recognize Chillventa as a competitor. What does Chillventa Russia set against Climate World’s clear concept? “Me Too” claim and declarations without any specifics.

– Ok, the first mistake is clear now. What about others?

Dmitri Kuzin: Rule No 2 sounds like “A project may not be managed from abroad.” NürnbergMesse GmbH, just like some other German companies, thinks, for some reason, that a successful project in Russia can be organized from abroad. The functions of the Moscow office are just representative ones; its task is to fulfill the orders of the exterior administration and spend not too much money for promoting the project.

Possibly, such an approach is successful in the united Europe. However, in Russia it led to several large-scale projects organized by German companies leaving the market. Their Russian employees, in private, complain that “we cannot decide anything here”, that “they make mistakes there, and we suffer here”; however, they cannot and do not want to change the situation – the good salaries and social benefits withhold from that. In fact, at the far-away ideological center they make up an ideal system, like Plato’s State, where everything – from A to Z – is considered. Everything, but the Russian realities. As a result, it starts with, like a great Russian poet said “He hath brought fruits of science from Germany of fogs”, but ends with “he’s carrying a horrible treasure back home” – in this case – the treasury of information about losses and no perspectives for the future. Maybe, it would be simpler just to provide philanthropic assistance to the organizations who support that project? There are honorable people among them, who deserve such aid; and Russian science needs foreign investments!

— And the third mistake is…

Dmitri Kuzin: The third mistake is neglect of the rule which Oleg said in the beginning of the interview: at the Russian market one needs to rely on Russian leaders and speak about Russian problems. No doubts, there are such problems; those are: introduction of self-regulation, outdated legislation, limitation on import of ozone-depleting refrigerants, difficulties related to the training of qualified staff, as well as difficulties with the application of modern technologies at our market. Those are the issues of Climate World project is intended to resolve.

Even now, Climate World has been already supported by four Russia’s largest industry associations: APIC and ABOK associations, self-regulated organizations in the field of engineering systems of buildings: NP ISZS-Proyekt and NP ISZS-Montazh. They devote time, efforts, and resources for industry-specific training, issuance of permits which replaced construction licenses, verification of HVAC equipment, market surveys and determination of market perspectives, distribution of energy-efficient and environment-friendly technologies, development of regulatory documentation taking into account European (including German) and American experience of working in Russia.

Climate World was also supported by United Nations Industrial Development Organization (UNIDO) which, within the framework of the project, will hold a conference on HCFC’s phase-out. Among the partners of the exhibition is the largest Japanese issue – Jarn – on the pages of which APIC, for many years by now, has been shaping the image of the Russian HVAC&R business for the whole world.

Climate World has five large web-resources, a leading industry magazine, huge mailing database, and the capabilities of the exhibition’s partners. My colleague has already told about numerous services which facilitate activities of HVAC companies, including those who cannot participate in the exhibition. And Chillventa Russia responds with just one thing – an offer to move to a “new house”. I doubt that you would agree to move from a nice house with strong roof, walls, equipped with air-conditioners, ventilation, heating, and water supply systems, to a house which exists now only in the form of a project which, in addition to all, cannot be shown to you. However, the choice is always yours.