Promotional products 93 out of 100 companies rely on the advertising impact of small gifts - a 600-million market.
Who hasn't been annoyed by them? The small, occasionally useless promotional items that, with a bit of bad luck, run out of juice after just five minutes in the form of a ballpoint pen or disappear never to be seen again in the back corner of the wardrobe in the form of a T-shirt.So promotional items are a clear case of superfluous? Not at all - after all, 93 percent of all companies in Switzerland now use gifts as an advertising medium. So there must be something about the sometimes small, sometimes larger gifts. "People simply like to receive gifts," says Beat Suter of Eckert Werbeartikel AG in Zurich. And then adds: "Small gifts simply keep customers coming back."
They are obviously doing this well. Promotional products consultant Robert Scheidegger from Promo'Plus AG in Münsingen estimates that 400 to 600 million Swiss francs are turned over here in Switzerland with promotional products. Suter even assumes up to 800 million francs. And the Promoswiss trade association, in which 28 promotional products retailers are organized, reckons with a volume of 600 million francs.
Different estimates
By way of comparison, according to the AG für Werbemedienforschung (Wemf), net advertising spending on all advertising media amounted to CHF 5.1 billion in 2003 (see chart below). This means that more than one in ten advertising francs was spent on gifts. However: Wemf itself no longer conducts surveys on promotional products. In 1999, the year of the last survey, it determined a volume of only 121 million Swiss francs.
The discrepancy between the Wemf figures and the estimates of Promoswiss and experts are huge. The reason for this lies in the vague definition of the promotional article. Do T-shirts, caps and other printed clothing worn at work already fall under it? What about gags whose luster fades in seconds? "And what about the wine bottle with an Ascom label, does it already count as a promotional item?" asks Scheidegger.
Be that as it may, the promotional products retailers don't care. The main thing is to keep the cash flowing - even in times of economic downturns, such as the one between 2001 and 2003, when advertising sales fell sharply (from 5.7 to 5.1 billion Swiss francs), according to Wemf. "We haven't noticed anything of a decline. On the contrary, we grew by a single-digit percentage," says Elisabeth Riwar of Racol Partner AG in Rotkreuz. Hans Lindauer, Compagnon at Immowerb Werbe-Presents in Horgen, and Beat Suter are also satisfied. Despite the economic problems, sales are stagnating or only slightly declining.
Robert Scheidegger, who also sits on the board of the Promoswiss trade association, has a different experience. "Today, every advertising franc is turned around twice," he reveals, "and then you save on promotional items first." However, the larger retailers organized in Promoswiss seem to be less affected by this. Small and very small businesses are probably more susceptible to declining advertising budgets due to a lack of size and professionalism.
Overall, the industry is characterized by strong fragmentation and high fluctuation. According to Scheidegger, there are between 300 and 400 providers in the market. "Only a handful of the companies have sales of 10 to 15 million." Suter doubles down: "There's hardly a promotional products company with a market share of more than three to four percent." In contrast, many "one-man shows" would open their doors every year - and in many cases soon close again. The reason: the hurdles to market entry are relatively low. "You need practically no investment and no great prior knowledge at the beginning," says Scheidegger. But if you want to be successful in the long term, you have to work professionally. Many of the small providers failed because of this.
Strong emotional component
In the meantime, promotional products have won an important place in the marketing mix. "Today, promotional gifts are simply part of the package," says Elisabeth Riwar. It's no wonder, since promotional items have striking advantages over other advertising media because most of them are handed over personally. "With no other medium do I receive a 'Merci' as an advertiser," says Scheidegger. In addition, at the time of delivery, there is absolutely no competition; the recipient cannot simply zap away or turn the page. The three-dimensional, emotional element should also not be underestimated: "You can touch a promotional gift," says Hans Lindauer, "you get an experience you won't soon forget."
What's more, there is hardly any other advertising instrument that can be used so widely: From A for subscriber advertising to D for saying thank you or M for trade fairs to V for VIP events, there are probably no events at which promotional items have to be dispensed with. According to Beat Suter, promotional items are currently particularly popular as mailing boosters (such as tea bags, Post-it notes or chewing gum), but also as door openers for the sales force.
Permanent lighter
In contrast to the past, however, companies today work much more efficiently with promotional items. The gift must fit the intended target group and the message associated with the item must fit the occasion. For example, it makes sense to give a key fob to a driver after his car has been serviced. But giving him a condom in the presence of his wife is probably a breach of etiquette and will definitely cause bad feelings.
The range of products is as broad as the possible applications: air mattresses, balls, writing utensils, agendas, mouse mats, clothing, and so on and so forth. Nevertheless, according to Robert Scheidegger's estimate, lighters and pens still account for around 20 percent of the market volume, while textiles such as clothes, caps and bags account for as much as 40 percent. "The lanyards that you wear around your neck are also selling very well at the moment," says Elisabeth Riwar.
Utility items are also well on trend. "Our customers want something useful that the recipients can use every day," says Hans Lindauer, "or then the absolute gag that costs them nothing to begin with." Riwar's assessment is along the same lines: "Customers want items that are useful and not fast-moving gags whose effect quickly fizzles out." In principle, the industry is clearly tending toward high-quality products: "The promotional items have to be right in terms of quality and also design," says Scheidegger. "Customers want branded and not cheap products," confirms Riwar. This applies to inexpensive giveaways as well as to more expensive, individualized gifts such as Victorinox knives.
And something else: "The gift must come from the heart," warns Scheidegger. If the person courting the customer's favor hands over the gift with a sour expression or even bashfully slips it to the customer, almost like a bribe, nothing is likely to trigger the intended positive feeling - not even a watch costing 6,000 francs, as Scheidegger reports.
The original gift for companies with a Swiss connection: the Swiss Travel Kit, which comes standard with a bar of Swiss Army Chocolate, a box of Swiss Navy peppermint candies, a Swiss lip balm and a pack of Swiss paper handkerchiefs. Seen at Pandinavia.
Integrated in an original communication package, the Smile bed bottle is likely to attract positive attention, Siegrist Werbeartikel is convinced.
A system for greater success If a promotional product campaign is to succeed, it needs a concept.
The following questions should be answered in it:
What are the goals?
Regardless of whether it's a sales increase, memo effect, invitation or contact building or cultivation: the promotional item is memorable and activating for the consumer.
What are the target groups?
These should be defined by age, profession or lifestyle, for example.
What are the expected measurable outcomes?
Whether contact volumes, additional sales or visitors at trade show booths: It is important to know that the effect depends strongly on the creative idea of the promotional item.
What funds should be invested?
Whatever the basis for budgeting: It's not the material value of the promotional item that matters. Even inexpensive items can have a big impact.
How long should the article work?
The life of any promotional item is limited and thus achieves a certain multiplier effect. Although standard promotional items such as notepads or pens are less popular, their utility and recall value is satisfactory.
How to transfer the item?
By mail or in person at an event, with or without a verbal message: the very process of distributing promotional items has a high profile, especially at events. Source: Promoswiss
Advantages of promotional gifts - They are tangible and palpable: Advertising you can touch has a lasting effect.
- They become the property of the customer: The high presence is guaranteed.
- They can be used individually; the scattering loss is therefore low to zero.
- They are useful and usable: Advertising with real utility value is the best image cultivation.
- They are designable and can be customized to suit the gift recipient.
- They arouse emotions and can become topics of conversation.
- They have long-term effect and are used several times.
- They create sympathy, because being given a gift gives pleasure.
- They open doors and make effective personal contacts.
- They are three-dimensional and make the message unmistakably clear.
- They make direct mailings more successful because they convey additional benefits.
Source: Promo'Plus AG
Patrick Imper