The promo industry has long struggled with a reputation for producing “trinkets and trash,” says Meg Erber, director of sales at Counselor Top 40 distributor Proforma (asi/300094).
While that perception surely harmed the industry’s image, it never escalated to the point of an open boycott on the use of promo.
In the past few years, however, there have been some high-profile conferences and companies that made a public show of eschewing giveaways and putting their marketing dollars elsewhere. This wave of “anti-swag” sentiment hasn’t stopped the industry from achieving record sales, but it has been a lingering cause of unease.
This year’s SOI survey found that while only 4% of distributors were “strongly concerned” about their clients developing negative attitudes toward promo, 19% were “somewhat concerned.”
Mia O’Brien, owner of Allen Associates Promotional Products (asi/117542) in Surprise, AZ, states that the first time she heard of any negative promo concerns among her customers was within the past nine months. “I don’t know if people are getting their information from the news or are just more aware of climate change, whatever the situation may be,” she says. “I guess I should start asking what makes them feel that way.”
According to O’Brien, in the past 6-9 months, her company hasn’t obtained any new clients, which she thinks could be attributed to the negative sentiment. “We usually have at least 2%-5% of new clients annually, but this year we’re having 1% or less,” she says.
The foundation of the anti-swag argument is the notion that promo contributes to pollution and global warming by introducing low-cost, low-quality goods that are given to users who have no interest in the products. The items are thrown away and create environmental waste.
of distributors said they’re concerned about clients developing negative attitudes toward promo.
For distributors, combatting negative concerns often looks like presenting more sustainable, carefully sourced products. For instance, O’Brien says that she offers eco-conscious products that are made of biodegradable and recyclable ingredients to her clients as the first option. Her company is also segueing into digital catalogs and presentations.
Erber says that distributors should elevate the conversation with their clients by focusing on “merch that matters” instead of trying to win orders on price. Rather than handing out 500 $1 items, distributors should urge their clients to purchase a lesser number of high-quality items. “If you’re giving something away that costs a dollar, that’s going to be their perception of you and of our industry,” she notes.
Jo Ann Burdek, managing director at Clearwater, FL-based Proforma Source1 Promotions (asi/491846), concurs. She says distributors should tell their clients that instead of trying to hand out five different products, opt for two or three more sustainable items that people will truly appreciate.
Adhering to that high quality and sustainable messaging is more difficult when sales are harder to come by. Distributors are observing that buyers are spending less so far this year due to economic and political concerns. Because 2024 is an election year, spend is still there – but not as big – due to uncertainties in the marketplace regarding potential outcomes, says Joseph Miller, founding partner of AIA LogoTools (asi/444130) in Coral Springs, FL.
Burdek says this impacts promo sentiment because when companies have more limited marketing budgets, some may aim to maximize the number of promotional items they can distribute to users. However, this often results in choosing cheaper, lower-quality products, an approach that may be cost-effective in the short term, but can also damage a brand’s image and worsen negative perceptions of the industry.
Gifting items people truly want to keep means that there needs to be strong messaging behind the item. “Because once you put a logo on something, it automatically has a shelf life,” Erber says. “So, if we can start generating more stories about how these products affect our day-to-day and less product selling, it helps that product extend its longevity.”
Miller says encountering negative promo attitudes is an opportunity to be positive and reinforce the value promo brings to the person who receives it, so long as it’s useful and functional. “You’re always going to get a person who doesn’t believe in promo, but that’s the opportunity,” he says. “At least you can understand where that person is coming from.”
He states that it’s not the distributor’s job to change the company’s attitudes toward their budgets – but it is their job to build a strong partnership with clients so that despite ups and downs in the industry, one can still be their go-to person who they can trust. “You build a relationship,” he says, “if it’s the type of business you want to be involved with.”
Hover over the bar charts to see more detailed State of the Industry statistics.
Markets Snapshot
The education market strengthened its grip on the top spot, while other sectors yielded some surprises.
Even though the same three biggest markets repeated from last year (education, healthcare and construction), something interesting happened at the top, where education further cemented its hold on the #1 spot with an increase of .7 percentage points. While that doesn’t sound like a lot, it meant the market generated an additional $222 million in promo spending. Other interesting developments with the promo industry’s top markets? Despite hundreds of thousands of tech company layoffs in 2023, the tech market actually improved slightly last year. Hospitality increased for the second straight year and is beginning to approach its pre-pandemic figures. And the nonprofit sector continued its weird cycle of alternating down years and up years. Most markets were up or down slightly – a shot of stability that distributors should welcome.
Top Markets for Promo Products Sales
($ in Millions)
“The number of students in college has finally turned the corner after years of decline.”Doug Shapiro, executive director of The National Student Clearinghouse Research Center, in a report revealing that college undergraduate enrollment rose 1.2% in fall 2023 – the first increase since the pandemic