One of the more troubling issues with AI as a topic that it is predominately discussed in the future tense. How often do you hear about the ways AI might or might not transform an industry? Perhaps the branded merch industry for example. That sort of confident rhetoric can certainly be well-reasoned, but it ultimately deals with hypotheticals.
Fortunately, the present – or at least recent past – is a period of time that we can extract data from, and that’s exactly what PPAI Research did in regard to AI use in the branded merch industry through surveys of PPAI 100 distributors and suppliers.
The in-depth findings will be covered below, but the headline result is clear: An overwhelming majority of both distributors and suppliers and distributors are adopting or testing AI into their workflow in some capacity.
- 98% of suppliers are using or testing AI, whether through informal employee use to formal company strategy.
- For distributors, that number jumps up to what amounts to basically 99.9%.
According to Alok Bhat, market economist and PPAI’s research and public affair lead, this mass adoption is a sign that it’s not just specific employees or managers looking at AI’s possibilities, but an evolution that is touching most departments in companies’ operations.
Alok Bhat
Market Economist and Research & Public Affairs Lead, PPAI
“This signals a shift from individual productivity to business execution, especially across sales, marketing, operations, reporting and client support,” says Bhat, emphasizing the strong AI usage among distributors.
Supplier Insights
Dealing with many moving parts and myriad logistics, for suppliers, AI represents both an enormously huge timesaving opportunity as well as something that is likely approached with caution; oversight remains crucial for work related to supply chain. The data suggests that adoption within areas of companies remains uneven, but the rate at which suppliers are embracing the technology makes clear that speed, capacity and business performance are elements they’re looking to AI for help with.
AI Adoption Among Suppliers:
These results, Bhat point out, suggest a crossover into complete willingness to adopt, or at least experiment with AI, but the data set that is going to represent the next phase of our understanding of AI in the industry is measuring the results of that AI which is currently being implemented. To do so in a valid way would mean waiting for a slightly longer sample size of time.
“The next step is not simply giving teams access to AI tools – it’s turning AI use into measurable impact across workflows, service and decision-making,” Bhat says.
A vast majority (88%) of suppliers claim that ChatGPT is used in some capacity within in their company, but platform adoption has expanded well beyond just one commonly used tool.
- 68% of suppliers cite Claude as an AI platform being used in some capacity.
- 54% claim Microsoft CoPilot is a resource.
- 38% say employees are using Google Gemini.
- 34% brought up Canva AI, Adobe Firefly or other forms of creative AI.
- 30% cited CRM tools with AI capabilities.
- Another 30% claim to be using custom internal AI tools.
Another big development for AI among suppliers is that implementation of AI is expanding beyond purposes of marketing content or campaign development (which, to be clear, still leads the way at 85.7%) into plenty of other uses and departments, including operational cases.
- 67.3% of suppliers are using AI in sales emails, presentations or proposals.
- 59.2% are using it for artwork mockups or creative concepts.
- Notably, more than half (53.1%) claim to use it for reporting, dashboards or business intelligence.
The data also suggests that AI is no longer an occasional resource that is called upon in special circumstances. It has entered daily operations for suppliers.
- 64.3% of suppliers are using AI for marketing content or product descriptions.
- 54.8% claim to use it for artwork preparation, mockups or virtual samples.
- 42.9% rely on it to answer repetitive questions about inventory, lead times, pricing or decorating options.
Distributor Insights
On the distributor side, the survey revealed a basic adoption or testing of AI in some capacity. Perhaps just as notably, about 80% of distributors say that AI is regularly used across departments and integrated into workflows or included in formal company strategy.
AI Adoption Among Distributors:
Perhaps more notable than the actual AI tools that distributors are using, which do not differ drastically from suppliers, is an interesting development in the use case for AI for distributors: The technology is beginning to power the distributor sales engine.
- It’s no surprise that 88.4% use it for marketing content or campaign development, as these have been initial use cases for AI.
- But an equal 88.4% of distributors claim to use AI for sales emails, proposals or presentations.
- Another 83.7% cite it for artwork, mockups or creative concepts.
“AI use is strongest in the areas closest to revenue generation: sales emails, proposals, marketing content, artwork, mockups and product research,” Bhat says.
Sitting between clients and suppliers in the supply chain, distributors have a clear sense of their pain points and thus know when and where to implement AI. As a group they, they serve as a good case study in the technology’s implementation. PPAI Research asked distributors to point out the most likely issues that would prevent them from adopting AI in any given circumstances.
The data draws a clear conclusion: AI’s next barrier is execution, not interest.
- 52.7% of distributors claimed lack of integration with current systems was a barrier to AI.
- Another 47.4% said lack of employee training or internal experience could hold AI back.
- 44.7% cite data privacy or client confidentiality concerns.
- An equal 44.7% suggest accuracy or trust in AI-generated output can cause reservations in larger adoption.
Another interesting data point indicates that distributors still prefer to maintain the human component of their relationships with clients. Most are keeping AI behind the scenes when it comes to their clients.
- The majority (61%) of distributors are keeping AI out of their interactions with clients.
“This suggests a practical and cautious approach,” Bhat says. “AI is helping with preparation, research, writing, proposals, ideas and creative support, while human judgment remains central to the client relationship.”
Industry Reaction To AI
Various industry experts have taken to PPAI Media to share their thoughts about how AI will change branded merch or how members of the community should be preparing for its inevitability.
Danny Rosin, CAS, co-president of Brand Fuel, PPAI 100’s No. 42 distributor, and chair of the PPAI Board of Directors, says that it’s important to not get ahead of yourself with the technology, because what AI cannot replace is every bit as crucial as what it can accomplish.
“The most valuable resource of our industry is still deeply human,” says Rosin. “AI cannot replace trust. It cannot replace the feeling a client gets when you solve a problem before they ask. It cannot replace creativity rooted in empathy. It cannot replace relationships built over years of showing up, solving crises, calming nerves before events, finding impossible inventory, navigating tariffs or delivering ideas that make people feel something.”
On the other hand, Bobby Lehew, chief AI officer at commonsku, says that AI represents something of an inflection point in business and society, one that we will see clearly when we look back on.
“AI is a force multiplier and we’re seeing it in our work,” Lehew says. “Every past disruption in our industry (the dot-com crash, the recession, COVID) was a demand shock. Revenue dipped, but the work stayed the same. With AI, the work itself is changing.”
Bobby Lehew
Chief AI Officer, commonsku
Siva Kandaswamy, founder and CEO of Sparkpolo, says that AI takes his companies’ goals and elevates them to new possibilities.
“It helps scale ideas, accelerate design exploration and bring concepts to life more efficiently, moving us beyond product transactions toward meaningful brand experiences,” says Kandaswamy.
Siva Kandaswamy
Founder/CEO, Sparkpolo
Dan Townes, president of Shepenco, has a blunter take on AI’s place in branded merch.
Dan Townes
President, Shepenco
“To be competitive in the branded merchandise industry in 2026 and beyond, you must become AI,” Townes says.
