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Promotional Sales Up Slightly, Down Slightly, Depending On The Source – Promotional Products Association International and Advertising Specialty Institute – Brief Article – Industry Overview

Promotional Sales Up Slightly, Down Slightly, Depending On The Source – Promotional Products Association International and Advertising Specialty Institute – Brief Article – Industry Overview – Statistical Data Included

IRVING, Tex. – Sales of promotional products by distributors either fell 7.3 percent in 2001 compared with 2000, or they rose 3 percent, depending on which survey you believe.

In any case, the industry had a better year than any other major advertising media in 2001.

The Promotional Products Association International, in its annual survey of product sales, said sales totaled $16.6 billion for 2001, a drop-off of 7.29 percent from sales posted in 2000. PPAI is the industry’s major trade association.

The Advertising Specialty Institute, on the other hand, in only its second annual measurement of PPD sales, said sales increased 2.99 percent in 2001 over 2000. ASI’s estimate for overall sales in 2001 was $16.5 billion. ASI is a for-profit firm that maintains the coveted ASI number listing service, among other things, for both suppliers and distributors.

In its press release, PPAI said, “After 10 consecutive years of growth, the promotional products industry saw a slight loss in distributor sales in 2001. Though this is the first-recorded decrease in 40 years, surveyed distributors felt the drop was directly related to the catastrophic events of September 11 and the resulting downturn in the country’s economy.”

“Obviously, no one could have anticipated what happened in September and our industry is not immune to the damaging effects of that tragedy,” says Steve Slagle, CAE, PPAI president. “Any shortfall in sales is distressing, especially when many of our distributor companies are small businesses. But in the midst of hard times, this industry has always proved resilient. We anticipate a strong recovery.”

PPAI’s annual estimated sales volume study has been conducted since 1974 by independent researchers. A survey is sent to a random sample of 15,775 distributors, drawing from an estimated total number of 21,194. The lists are compiled from PPAI membership as well as from four other industry organizations/firms. The distributor companies are divided into two groups: those with sales more than $2.5 million and those with sales less than $2.5 million.

The study was conducted for PPAI by Alan D. Fletcher, Ph.D., at the Manship School of Mass Communication at Louisiana State University and Rick Ebel, former marketing communications director of PPAI and principal of Glenrich Business Studies in Hot Springs, Ark.

According to data collected by ASI from its current roster of listed distributors, the 2.99 percent increase in 2001 sales was far smaller than the rise of 20 percent measured for the jump in sales in 2000 compared with 1999. However, ASI says this modest rise for 2001 compared favorably with advertising/promotional spending in general, “which saw declines of between 5 percent and 20 percent in most other media.”

“Amidst all the doom and gloom emanating from other sectors of the advertising industry, the fact that promotional products posted even a marginal gain is further proof that this is truly a resilient ad medium,” said Richard Kern, editor-in-chief of The Counselor, ASI’s monthly magazine.

ASI’s press information went on to say, “Despite well publicized reports of some top industry firms experiencing declines in sales, distributors with annual revenues of $2 million or less comprise the lion’s share of the market, and increases by these small- and mid-sized companies more than offset the losses by the largest firms.”

The ASI study was conducted by Marjorie Cooper, professor of marketing at Baylor University. Dr. Cooper conducted the PPAI study measuring sales for several years until last year when she was contracted by ASI.

For more information on both studies, go to the organization’s Website. PPAI’s is www.ppa.org, and ASI’s is www.asicentral.com.

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