After years of what has amounted to stagnation, the promo industry is eager – and perhaps poised – to get moving again, two of its most influential leaders agree.
Taking the stage Wednesday at the beginning of Specialty Advertising Association of California’s SAAC Expo in Anaheim, in a keynote panel moderated by PromoShop President and PPAI Board Member Kate Alavez, the executive heads of PPAI and ASI expressed confidence that innovation, education and a shift in how branded merchandise is positioned can drive a stronger future.
Considering that the industry revenue trajectory has lagged behind inflation for the better part of a decade, that would be welcomed change. Just over seven months into his role leading PPAI as president and CEO, Drew Holmgreen has visited the headquarters of more than 30 members and had countless more conversations on the industry outlook.
Drew Holmgreen
President & CEO, PPAI
“Cautious optimism,” Holmgreen said to summarize. “The reality here is that the markets are doing exceptionally well, which flies in the face of everything you would read from economists and the marketplace in general.”
“Our industry is fundamentally down from 2019 pretty significantly, and we need to get back to growth,” ASI President and CEO Timothy Andrews said.
Timothy Andrews
President & CEO, ASI
Despite the uneven recovery, fragmentation in the marketplace creates opportunity for firms pushing to outpace the average. “Nationally, we’re a $26 billion industry,” Andrews said. “That means there’s a lot of room for market share. Just because the industry may be slow-going, that doesn’t mean you and your firm have to be slow-going.
“It’s how do I be the 10% or 20% grower?”
The panelists also emphasized the importance of reframing promotional products as a core marketing channel, rather than an afterthought. Holmgreen hinted at PPAI’s intention to reposition the medium as a true marketing channel, not an afterthought.
Holmgreen pointed to promo’s advantage of recall and likeability with target audiences. “We are twice as impactful as digital, and digital gets a hell of a lot more spend,” Holmgreen said. “When you bring data, focused numbers, return on investment and become both a creative and financial consultant to [clients], now you’ve got the opportunity to really make your mark, and help us make that turn from pushing products to pushing concepts. At the end of the day, that’s what brands need – conceptual partners. And that’s where we can really break through.”
Economic uncertainty, they said, has only accelerated innovation. As client budgets have tightened, that means a focus on maintaining margins, with an emphasis on technology. Alavez prompted deeper discussion on opportunities through AI, automation and robotics. Andrews pointed to apparel firms already envisioning warehouses run by robots within five years, with perhaps two employees whose primary job is the maintenance of the robots.
“This is legitimate, what’s going to happen,” he said.
Both agreed that education will be key to capitalizing on the changing landscape. Both organizations have recently rolled out new education initiatives, including the PPAI Advance professional development track.
While the two national organizations compete in some ways, both leaders underscored the value of regional associations and stressed the complementary role of each entity. Holmgreen alluded to a reforming relationship between PPAI and ASI. The two organizations have partnered on advocacy and some research projects, and frequently attend one another’s events.
“We both do things extremely well,” Holmgreen said. “The regional associations, versus our two groups, are paramount for anybody who is going to advance in this industry. You can invest in yourself in ways that are local, national and global. And that’s where the power comes in.”
Andrews called the regional associations “the heart of the industry,” a source of community, relationships and support system, while national organizations provide broader scale for education, large events and international reach.
The session ended with audience questions, some philosophical and some practical. One posed how distributors can elevate their role with clients. “I would go into those conversations as inquisitive as possible,” Holmgreen said. “Start with the basics: What are you hoping to accomplish? Who’s your target audience? Sometimes just asking the right question starts the breakthrough.”
Kate Alavez
President, PromoShop & PPAI Board Director
Alavez added that industry pros bring value by providing details around compliant products, protecting data and then layering on ideas that level it up. “I’m seeing a lot of magic in the value of our industry,” she said.
Though leading different organizations, the panelists’ perspectives converged on a single message: The industry is resilient and filled with opportunity for those who innovate, educate themselves and reframe their role.
