Gift Tags

MARKETERS spent more on promotional products than expected last year, but still held their purse strings tighter than in the past as they shopped for premiums that fit their brand, rather than sheer novelty. ▪ Promotional product sales fell 7.9 percent to $16.5 billion for 2001, reports Irving, TX-based Promotional Products Association International (PPAI). That’s good news, since industry experts had predicted double-digit losses; it’s bad news on the heels of double-digit growth of nearly 20 percent in 1999 and 13 percent in 2000.

Many see slowed growth as an inevitable plateau, hastened by the tight economy. Some see it as opportunity.

“With a downturn in the market, everybody is looking for an edge to make themselves more competitive,” says Tom Halzack, president of Smart Imprints/Emergent Marketing, Bridgeport, CT. “A savvy company that understands the use and effectiveness of promotional products as a conduit to better personal relationships” can make inroads with a well-planned campaign.

Marketers want a unique premium that suits their message. Microsoft Press offered trade show attendees a coffee press — “just like you’d see in Starbucks, but obviously a consumer model,” says Bruce Jolesch, president of Dallas-based The Jolesch Group, which handled the push for Microsoft. “They loved it.”

Jolesch staffers meet with clients to find a premium that suits their objectives.

“We never sell somebody a product just because it’s on sale that week,” he says. “If it doesn’t help our client move more of what they sell, nobody wins. You need to help create an emotional attachment with the customer.”

One Jolesch client commissioned etched wine bottles to commemorate the anniversary of its initial public offering. “In most cases, the bottle goes on display and is never even opened — and if they do open it, they still keep the bottle,” says Jolesch. “Better to give out 100 really nice gifts than to give out 10,000 widgets.”

Widget Magic

Still, smaller items — think key chains and coffee mugs — work in the right setting. A new cleaning and maintenance service catering to owners of multi-million dollar summer homes leveraged its nautical theme by mailing a package with a nautical key chain, compass, and a whistle to homeowners culled from realtor listings and club memberships. Recipients who asked for an in-person sales pitch were sent a mug set.

“It’s nice to use a combination of promotional products,” says Diana Edwards, president of Red Oak Advertising, the Indiana, PA-based supplier that handled the campaign (and won a PPAI Golden Pyramid Award for it).

Business-to-business campaigns benefit from tight integration, too. An outdoor advertising company curried favor with local and zoning officials by bringing gifts of high-quality apparel items to meetings and lunches. (All items cost less than $50.) The ad firm also shuts its office once a month to let staffers volunteer for the United Way. “It was a whole integrated ongoing campaign and the main thrust went on for a year,” says Halzack, whose firm handled the effort. “Promotional products are a nice sincere way to make a personal connection with people, if you’re doing it the right way. T-shirts, pens, and jackets can help build awareness and build a positive image of the company.”

Wearables remain the most popular promotional product, accounting for 29.3 percent of 2001 spending (up from 29.1 percent), per PPAI. Writing instruments carried 18.5 percent of sales, while no other category accounted for more than eight percent.

So if everyone is giving out T-shirts, how can your giveaway stand out? Packaging, says Halzack. “What makes a good product a great promotion is the correct packaging and messaging around it. Let’s say you do a coordinated shirt and hat in a mailer that also had another item linked to the same message. Now you have a dimensional mailer with two or three products linked together that will reinforce and increase the power of each product. It will definitely, absolutely get attention, and if you’ve themed it properly, you’ve got a very powerful message.”

Smaller distributors (sales under $2.5 million) saw sales fall only 0.9 percent; large distributors (sales over $2.5 million) fell nearly 15 percent, PPAI reports.

Experts suggest that smaller distributors’ personal relationships, closer contact with customers, and more flexible offerings kept small distributors from losing more ground. Smaller companies racked up 43.8 percent of total sales, while larger companies accounted for 56.2 percent.

PPAI annually surveys 15,000 promotional product distributors via Louisiana State University and Glenrich Business Studies, Hot Springs, AR.

Distributors are optimistic that spending will return.

“I think the numbers will definitely come back up when the economy comes back,” says Edwards of Red Oak. “I attribute the drop in sales volume to a general economic slowdown, and people pulling their budgets in the fourth quarter last year.”

The Next Big Thing

In the meantime, marketers continue to hunt for new gadgets. Distributors temper that taste for novelty with an eye on long-term trends.

“Clients are always looking for something different, but you have to make sure that the ‘something different’ you present actually matches the promotion,” says Edwards, who talks with other vendors to keep tabs on trends.

Halzack goes “out of the industry” to gift shows for new ideas and to meet vendors outside the promotional products segment. “I’m still looking for the next Cello-Mint idea to come along,” he says. (The mints come in small sheets that look like cellophane — think Listermint Strips.) “These hit about a year and half ago, and were completely novel. Sometimes a brand new product makes a lot of noise.”

But beware jumping on a new-product bandwagon with abandon.

“There’s been a big move in the last few years towards robotic electronic products like calculators and alarm clocks, where you hit a switch and the top flips open,” says Halzack. “Those had a lot of novelty when they first came out because what was normally a static object now had some animation in it. Everybody thought it was the coolest thing going, but now they’ve been way, way overdone and they’ve lost that novel quality.”

As distributors continue to forage for the next big thing, they’re getting mileage from classic items by carefully matching the message to the brand. That’s the real gift for marketers.

Brian W. Kelly is a freelance copywriter, journalist, and researcher specializing in promotion and marketing-related topics. He can be reached at [email protected] or (203) 775-6487.