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Power of Promotional Products
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Transcript of Power of Promotional Products
The Power of Promotional Products
Promotional Products Association International
Table Of Contents
Section A: Industry Information and Statistics
Section B: Applications of Promotional Products Section C: Research Studies
Section D: Conclusion
SECTION A
INDUSTRY INFORMATION AND STATISTICS
Items used to promote a product, service or company program, including advertising specialties, premiums,
incentives, business gifts, awards, prizes, commemoratives and other imprinted or decorated items.
What are Promotional Products?
.
How big is the Promotional Products Industry?
$19,440,837,547
Source: The PPAI 2007 Sales Volume Estimate
Growth of Industry Sales(PPAI Sales Volume Estimates by Year)
$5.01$5.12$6.22 $7.01
$8.04
$9.49
$11.88
$13.18
$14.94
$17.85
$16.55$15.62
$16.34$17.31
$18.01$18.78
$19.44
0
2
4
6
8
10
12
14
16
18
20
1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007
In Billions Of Dollars
2007 SALES BY PRODUCT CATEGORY (2006 Figures in parentheses)
Wearables 30.71% (30.78%)
Writing Instruments 10.39% (9.95%)
Calendars 5.51% (6.47%) Drinkware 6.32%
(5.64%)
Bags 7.05% (5.81%)
Desk/Office/ Business Accessories 6.19% (6.28%)
Recognition/Awards/Trophies/Jewelry 3.55% (3.56%)
Other 2.32% (2.34%)
Textiles 2.25% (2.05%)
Sporting Goods 2.57% (2.95%)
Magnets 2.37% (2.23%)
Housewares 2.35% (2.64%)
Computers 3.31% (2.28%)
Automotive 2.48% (2.31%)
Clocks & Watches 1.62% (1.87%)
Buttons/Badges/ Ribbons 1.82% (2.26%)
Stickers & Decals 2.07% (2.58%)
Electronics 1.69% (1.74%)
Games 2.21% (2.49%)
Food 1.75% (1.91%)
Personal 1.68% (1.86%)
Source: 2007 PPAI Product and Program Category Surveys
1. Education: schools, seminars 2. Financial: banks, credit unions, brokers 3. Not-for-profit: (e.g. charities, churches) 4. Health care: hospitals, nursing homes, clinics, pharmacies 5. Construction: building trades, building supplies 6. Trade, professional associations and civic clubs 7. Real Estate: agents, title companies 8. Government: public offices, agencies, political candidates 9. Professional: doctors, lawyers, CPAs, architects, etc. 10. Restaurants and bars
(2007 Top Buyers study)
Top Buyers of Promotional Products
by Industry
SECTION B
APPLICATIONS OF PROMOTIONAL
PRODUCTS
2007 SALES BY PROGRAM
CATEGORY (2006 in parentheses)
Source: 2007 PPAI Product and Program Category Surveys
Employee Relations & Events 13.80% (8.46%)
Trade Shows 10.68% (11.36%)
Brand Awareness 12.84% (8.87%)
Dealer Distributor Programs 6.16% (7.73%)
Public Relations 7.05% (8.75%)
New Customer/Account Generation 9.98% (7.61%)
New Product/ Service Introduction 5.78% (5.29%)
Employee Service Awards 5.44% (5.43%)
Not-For-Profit Programs 8.16% (5.89%)
Internal Promotions 6.30% (3.47%)
Customer Referral 6.76% (2.33%)
Safety Education/Incentive 2.78% (3.04%)
Marketing Research 1.53% (1.36%)
Other 2.73% (1.84%)
Note: (Business Gifts as a category has been eliminated in 2007)
Advantages of Using Promotional Products
Flexible
Tangible and long-lasting
Impact easily measured
Higher perceived value
Complements targeted marketing
Complements other advertising media
SECTION C
RESEARCH STUDIES
Promotional Products – A Key Ingredient to Integrated Marketing
In a study conducted in a controlled environment by researchers at
Louisiana State University and University of Texas at San Antonio
researchers explored:
Effectiveness of promotional products when compared to other traditional forms of advertising such as television and print
Synergistic effects of promotional products when used along with these other media
A 2006 Study by Louisiana State University and University of Texasat San Antonio
Promotional Products – A Key Ingredient to Integrated Marketing (Contd.)
Seven groups of people were exposed to advertising for a new pizza product via the three mediums, namely, television, print and promotional products
These groups were:
Group 1: TV Only (control group) Group 2: Print Only (control group) Group 3: TV-Print (control group) Group 4: Promotional Product (Experimental group) Group 5: TV-Promotional Product (Experimental group) Group 6: Print-Promotional Product (Experimental group) Group 7: TV-Print-Promotional (Experimental group)
A 2006 Study by Louisiana State University and University of Texasat San Antonio
Promotional Products – A Key Ingredient to Integrated Marketing (Contd.)
In particular, the questions in the study measured the following:
Advertisement credibility Attitudes toward product, advertisement or promotional product Product purchase intention Referral value Impressions of the advertisement Perceptions about the product
A 2006 Study by Louisiana State University and University of Texasat San Antonio
Promotional Products – A Key Ingredient to Integrated Marketing (Contd.)
When comparing the effectiveness of promotional products with televisionand print, findings revealed:
While the print ad came in first overall, the promotional product outperformed television across the board.
Respondents preferred advertising through a promotional product to the television ad in terms of their:
- Positive attitudes toward the ad (41% to 18%), - Positive attitude toward the product (20% to 16%), - Message credibility (54% to 33%) - Purchase intent (25% to 17%) - Referral value (26% to 16%)
Adding a promotional product to the media mix generated favorable attitudes toward the ad in all cases (up to 44%)
A 2006 Study by Louisiana State University and University of Texasat San Antonio
Promotional Products – A Key Ingredient to Integrated Marketing (Contd.)
When examining the synergistic effects of promotional products
when used along with other media, findings of the study revealed: Integrating a promotional product with television and print ads
increased referral value as well as credibility of the message
Groups who were exposed to promotional products tended to rate the advertising message more positively than those groups not exposed to a promotional product
A 2006 Study by Louisiana State University and University of Texasat San Antonio
Promotional Products’ Impact on Brand/ Company Image
An experimental study conducted by Georgia Southern University shows that recipients of promotional products have a significantly more positive image of a company than those who do not receive promotional products.
For the study, the researchers selected, as the test company, a restaurant located in a college town a few miles from a university campus.
00.5
11.5
22.5
33.5
44.5
55.5
Product No Product
Overall Image
Image Uniqueness
Perception Lunch Patronage Likelihood
Dinner Patronage Likelihood
A 2005 Study by Georgia Southern University
Promotional Products’ Impact on Brand/ Company Image (contd.)
The group receiving the promotional product was significantly more likely to recommend the business to others than the group that received nothing.
2
2.2
2.4
2.6
2.8
3
3.2
Likelihood To Recommend The Business
Product No Product
Promotional Products’ Impact on Brand/ Company Image (contd.)
The group receiving the promotional product had a more positive image as evidenced in their comments about the company than the non-recipient control group. The difference was statistically significant.
0
0.2
0.4
0.6
0.8
1
1.2
Perception Of The Business As Reflected By Positive Comments
About The Company
Product No Product
Promotional Product Incentives Produce Valuable Referrals From Satisfied Customers
Accompanying a request for referrals, an offer of a promotional product incentive or an offer of a promotional product incentive and eligibility in a sweepstakes drew as many as 500 percent more referrals than an appeal letter alone.
Offers of promotional product incentives are likely to be substantially more effective than enclosing free promotional products with an appeal letter.
A 2005 Study by Louisiana State University and Glenrich Business Studies
0.80%
0%
4.80%4.80%
0
0.005
0.01
0.015
0.02
0.025
0.03
0.035
0.04
0.045
0.05
Appeal Letter alone
Letter plus free promotional product
Letter + promotional product incentive for referral
Letter + promotional product incentive + sweepstakes
Effectiveness of Promotional Products at Tradeshows
71.6% of attendees who received a promotional product remembered the name of the company that gave them the product
76.3% of attendees had a favorable attitude toward the company that gave them the product
71.6%
28.4%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
PERCENT OF COMPANIES THAT REMEMBERED THE NAME OF
THE COMPANY
Yes
No
A 2003 Study by Georgia Southern University
Increase Booth Traffic with Promotional Products
Are Pre-show mailings with
Promotional Product Offerings
More Effective in Increasing Booth
Traffic Than Mailings Without?
Including a promotional product with a pre-show mailing or an offer of a promotional product increases the likelihood of an attendee stopping by a tradeshow booth
As a general rule, promotional products of greater value generate more sales leads than products of lower value
23%
36%
41%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
Mailer Only Mailer withMagnet
Mailer with T-shirt Offer
A 2004 study by Georgia Southern University
Impact, Exposure and Influence of Promotional Products
53.10%
76.10%
0.00%
10.00%
20.00%
30.00%
40.00%
50.00%
60.00%
70.00%
80.00%
Print Media PromotionalProducts
Reach:
71% of business travelers randomly surveyed at DFW Airport reported receiving a promotional product in the last 12 months
33.7% of this group had the item on their person - a coveted location for advertising
Recall: 76.1% of participants could recall the name of the advertiser on the promotional product that they received in the past 12 months
In comparison only 53.5% of participants could recall the name of an advertiser they had seen in a magazine or newspaper in the previous week.
A 2004 Study by L.J Market Research
Impact, Exposure and Influence of Promotional Products (contd.)
Impression of the Advertiser
52% of participants in the study did business with the advertiser after receiving the promotional product.
Of those who had not done business with the advertiser that gave them the product, almost half stated that they were more likely to do business with the company that gave them the item
52.1% of participants reported having a more favorable impression of the advertiser since receiving the item.
Impact, Exposure and Influence of Promotional Products (contd.)
Frequency of Exposure/Lower Cost Per Impression
73% of those who used the promotional product that they had received stated that they used it at least once a week
45.2% used it at least once a day
The greater the frequency of exposure, the lower the cost per Impression
Repeated Exposure
55% of participants generally kept their promotional products for more than a year.
22% of participants kept the promotional product that they had received for at least six months.
Impact, Exposure and Influence of Promotional Products (contd.)
Why Keep the Promotional Product 75.4% of those who received a promotional product stated that
they thought the item was useful 20.2% kept the promotional product because they thought it was
attractive
Pass - Along Exposure Participants of the study were asked what they do with promotional
products that they do not keep. 26% of participants reported that they give the item to someone else.
Clients Respond to Business Gifts
A study by Wayne State University demonstrated that business gifts not only improved sales but also customer attitudes.
Results were compared among three groups: a) The letter Group -a group that received a letter of thanks b) The Silver Group - those that received a letter plus a silver desk set (a $20 value)c) The Gold Group - those that received a letter plus a gold desk set (A $40 value)
A 1998 study by Wayne State University
Clients Respond to Business Gifts
3.02.8 3.6
3.74.2
4.7
0.00.5
1.01.52.02.5
3.03.54.04.5
5.0
Letter Letter+Silver Gift Letter + Gold Gift
SatisfactionIntent to Buy
1 = Very Dissatisfied/Very unlikely to buy and 7 = Very Satisfied/Very likely to buy
Trade Shows
To promote traffic at its booth, an exhibitor sent invitations to 4900 trade show registrants. Registrants were further broken down into smaller groups, each of which received from zero to three gifts(before, at, and/or after the show).
The researchers measured booth traffic, post-show memory of having received the invitation and goodwill toward the company.
A 1991 Study by Exhibit Surveys, Inc
Trade ShowsBooth Visitation Rates
11.6%
4.2%
0%
5%
10%
15%
20%
25%
Product + Offer for MatchingIncentive at Show
Invitation Only
176%
Increase
The use of promotional products in this study increased:
Booth visitation Remembrance of the invitation Feelings of goodwill
Improve Direct Mail Response Rates with Promotional Products
The use of promotional products in conjunction with a sales letter can make a significant difference in direct mail response rates.
The use of promotional products can also improve a business’ effectiveness in converting leads to sales appointments.
A 1992 study by Silver Marketing Group
Findings
1.8%2.7%
7.3%
-1%
1%
3%
5%
7%
9%
11%
13%
15%
Sales Letter Letter & PromotionalProduct
Letter plus offer ofPromotional Product
Incentive* In terms of appointments secured
The inclusion of a Promotional Product to a mail promotion increased the response rate by 50%
The use of Promotional Products as an incentive to respond generated four times as many responses as a sales letter alone
The use of a Promotional Product as an incentive to respond reduced the cost per response by two- thirds.
Repeat Business
New customers who receive promotional products, on average, return sooner and more frequently, and spend more money than new customers who receive coupons. In two separate studies, SMU researchers tested whether promotional products would outperform coupons in the area of repeat business and sales. Promotional product recipients spent 27% more than coupon recipients and 139% more than welcome letter recipients over an 8-month period.
Promotional product recipients were also 49% more likely than coupon recipients and 75% more likely than letter recipients to return and patronize the business in each of the eight months studied.
A 1994 Study by Southern Methodist University
Total 8-Month Spending
$219
$173
$92
$0
$50
$100
$150
$200
$250
PromotionalProduct
Coupon Sales Letter
Employee Awards and Incentives
In 1994 Baylor University randomly surveyed 1,500 people, asking their opinions regarding employee awards and incentives.
Survey recipients were asked to rate how most employees felt about awards and incentives.
A 1994 Study by Baylor University
The survey found that:
Employees like awards and incentives Employees are motivated to win awards Employees work hard to win awards Employees encourage their co-workers to work toward awards and incentives.
Motivating through Incentives
A 1999 survey by the Incentive Federation Inc., revealed that incentive programs are both highly effective as well as cost efficient.
The survey was sent to 4,000 executives in a cross section of American Companies. Respondents were current users of merchandise and travel items for motivation/incentive applications.
The study revealed that American businesses spend $23 billion annually on merchandise and travel for motivational use.
A 1999 Incentive Federation Study
How Incentives are Used
82%
66%61%
48%
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
Sales Incentives Consumer/ UserPromotions
Non-SalesRecognition/ Motivation
Dealer Incentives
Percentage of Incentive Programs that Achieve Established Goals
83.10%83.70%
88.30%
80.00%
81.00%
82.00%
83.00%
84.00%
85.00%
86.00%
87.00%
88.00%
89.00%
Dealer Programs Consumer/ User Programs Sales Programs
Generate Customer Referrals Using Promotional Products
A 1993 study by Baylor University found that customers who receive promotional products are more willing to provide leads than customers who don’t receive promotional products.
Twenty Mary Kay consultants participated in a study where half of them distributed promotional gifts to customers and the other ten offered no promotional items to their customers. Both groups then asked customers (200 in all) to refer names of acquaintances.
A 1993 Study by Baylor University
Findings
44%
13.3%
35.8%
11.7%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Referrals PerSalesperson
Number of Customersgiving Referrals
Gift
No Gift
Customers who received a promotional product were 14% more likely to provide leads than those who did not
Sales people who gave promotional gifts to their customers received 22% more referrals than sales people who did not use promotional products
40% of the salespeople who used gifts commented on how well the gifts were received by their customers
Build Customer Goodwill with Promotional Products
Promotional products foster customer goodwill toward a company and its salespeople.
A 1992 study by Baylor University, involved a textbook publisher sending 4000 educators either: 1) a pocket calculator plus a letter, 2) a lower priced highlighter pen plus a letter or 3) a letter only.
A 1992 study by Baylor University
Feelings of Goodwill Toward Company and Sales Representative
3.222.72
2.12
0
1
2
3
4
5
6
More Expensive Gift(Calculator)
Less Expensive Gift(Highlighter)
Sales Letter
Scale: 1=negative/6=positive
The use of promotional products in this study resulted in:
An increase in feelings of goodwill toward the company and its salespeople
A more positive attitude among those who received the calculator than for those who received the less expensive highlighter pen
On questions relating to the customers’ personal feelings toward the company and its sales representatives, customers who received the calculator scored 52% higher than the letter only group.
Dimensional Mailings
The packaging of promotional products can evoke curiosity as well as an increase in direct mail response rates. A 1993 Baylor University study revealed that the use of dimensional mailers can significantly improve response rates over direct mail alone.
For this study 3000 school administrators were divided into three groups and received either: 1) sales letter and sales literature, 2) sales letter, literature and a promotional product, 3) the sales letter, sales literature and promotional product but delivered in a box with a die-cut slot.
A 1993 Baylor University study
1.9%2.1%
3.3%
0%
1%
2%
3%
4%
5%
Sales Letter Letter and PromotionalProduct
Letter, PromotionalProduct & Dimensional
Packaging
Dimensional Direct Mail Response Rates
Improve Response Rates to an Advertising Campaign With Promotional Product Mailings
In a 1996 study PPAI helped a national tile distributor integrate the use of direct mail and promotional products into a print advertising campaign.
One group of subscribers received only the trade ad.
Other groups received a sales letter, a promotional product, or a promotional product incentive along with the trade ad.
1996 study by Dallas Marketing Group
Findings
.70%
2.30%
4.20%
9.55%
0%
1%
2%
3%
4%
5%
6%
7%
8%
9%
10%
Trade Ad Ad+Letter Ad+ Stress Ball Ad + CalculatorIncentive
SECTION D
CONCLUSION
The value of Promotional Products is in their ability to carry a message to a well-defined audience. Because the products are useful to and appreciated by the recipients, they are retained and used, repeating the imprinted message many times without added cost to the advertiser.
The information contained within this presentation will provide a greater knowledge of promotional products, the industry and its applications.
This information has been made available to you courtesy of Promotional Products Association International and Dynamic Image Marketing Systems, Inc.
For more Information contact: Craig CavanaughCasa del Mar3910 Sorrento Valley Blvd. Suite 100San Diego, CA 92121