Irving, Texas-based Promotional Products Association International (PPAI) released the results of its annual study confirming distributor sales of promotional products in 2007 increased 3.5 percent to $19,440,837,547 for 2007—setting a new sales record for for the third consecutive year. Distributor sales for the same period in 2006 were $18.8 billion.
The annual study was conducted exclusively for PPAI by Richard A. Nelson, Ph.D., at the Manship School of Mass Communication at Louisiana State University; Rick Ebel, principal of Glenrich Business Studies; and Michaela Mora, research consultant at Relevant Insights, LLC.
Sales of promotional products have increased by more than $670 million in 2007. This is a stark contrast to the revenue numbers for more traditional forms of advertising. In fact, promotional products sales growth far surpassed advertising revenues for newspapers (down 9.4 percent), television (down 4.4 percent), business magazines (down 4.2 percent) and radio (down 2 percent) from 2006.
At more than $19.4 billion, promotional products sales continue to outperform event marketing/ sponsorships ($19.1 billion), cable television ($17.8 billion), Yellow Pages advertising ($14.6 billion) and outdoor advertising ($7.3 billion).
“This report marks the largest sales figure in the history of the industry,” said Steve Slagle, CAE, PPAI president and CEO. “Promotional products continue to grow in popularity because, simply put, they work. Promotional products are the only advertising medium capable of engaging all five senses.”
“I find it particularly interesting to note that the more tangible and personally engaging forms of advertising continue to do well. Promotional products, event marketing and direct mail are on the rise, while ad revenues for more passive media—television, radio and newspaper—are showing a sharp decline. These numbers clearly support our research that proves when used as a key element in the marketing mix, promotional products effectively cut through advertising clutter to create a more positive outlook toward the ad and the brand,” Slagle continued.
Forecast For 2008
At the request of membership, PPAI added a new survey question this year. Researchers asked promotional consultants to predict how their company’s sales would do in 2008. The vast majority of promotional consultants expect sales to be up in 2008 over 2007 sales numbers—59 percent of smaller distributors (less than $2.5 million in sales annually) and 65 percent of large promotional consultant companies have a positive outlook for 2008. Less than 15 percent of those companies surveyed indicated that sales numbers would be less than recorded in 2007.
“The industry for the most part had a good year, considering how some of the markets many distributors rely on tanked. When we asked distributors why they fared so well, the word so many of them told us was diversification,” said researcher Ebel. “As to 2008, we think business in general is in for a hard time, due in no small part to the explosive impact of the petroleum prices and the rising costs of many imported goods. But promotional products? Might surprise the doomsayers,” he concluded.
For more information on PPAI, visit www.ppa.org
