• by Karl Greenberg , June 19, 2009

Those branded mugs that banks give away at street corner tables for new-account signatories may not look like much, but those branded promotional items -- and products like them, from pens, paperweights and packets of mint to branded Philippe Patek watches and Waterfords (for those invitation-only, experiential-marketing events, presumably) -- add up to huge dollar volume.

An annual study by the Promotional Products Association International (PPAI), an Irving, Texas-based industry group, says distributor sales of swag hit $18.1 billion last year -- the third-highest sales number on record.

The PPAI-commissioned effort, by Richard A. Nelson at the Manship School of Mass Communication at Louisiana State University and Rick Ebel, principal of Glenrich Business Studies in Corvallis, Ore., found that in spite of a 6.89% decrease from 2007, promotional products have trended up almost a percent from 2006 to 2008. The group says the numbers diverge from newspapers, business magazine, and radio advertising, down over 8%, 3.9%, and 3.3% respectively for that period.

Steve Slagle, president and CEO of PPAI, says last year's drop in part reflected the Pharmaceutical Research and Manufacturers of America's voluntary PhrMA Code on Interactions with Healthcare Professionals -- restrictions that suggest only items related to education of practitioners and patients be given by pharma reps -- meaning no branded golf bags, balls, pen sets ... you name it.

"In light of the recession and the dramatic decrease in sales attributed to the PhRMA Code in the last half of 2008, we were not surprised at the drop in sales last year," says Slagle. "[It] was a tough year for many of our members. However, it was particularly interesting that the more tangible and personally engaging forms of advertising fared much better overall compared to more passive media like television, radio and newspaper, which all reported a sharp decline," he said.

"These numbers clearly support our research that proves when used as a key element in the marketing mix, promotional products effectively cut through advertising clutter to create a more positive outlook toward the ad and the brand."

The researchers for the PPAI study garnered data via survey sent to 16,000 member and non-member promotional consultant companies. The study asked promotional consultant companies to report products sales for the 12-month calendar year ending Dec. 31.