Market Watch: Distributors (and a Supplier) Discuss 5 More Promo Products Verticals to Target
On any given day, promo distributors wear about a billion different hats. Customer service, social media, marketing campaigns, product research, calling on clients and prospects, checking order statuses, double-checking artwork, getting quotes, giving quotes, brewing the coffee, answering email, etc. That doesn’t leave a lot of time for researching business opportunities in new vertical markets, or staying up to date on trending products and client expectations in markets you’re already in.
We’ve got you covered. In our March issue, we looked at six thriving vertical markets, and we’re back with a look at five more. Thanks to four distributors and a supplier, we have the fortune of being able to divulge a few tips on how and what to sell in the retail, media/entertainment, nonprofit, beverage and legal marijuana markets, while also adding forecasts for where they are headed far beyond the remainder of 2019. It goes without saying that this won’t serve as a replacement for real, deep research on any of these markets, but hopefully it’s a starting point—some quick inspiration while you’re waiting for that coffee to brew.
Since the National Retail Federation is calling for U.S. retail sales to total more than $3.8 trillion this year, relying on consumer spending tallies to measure the economy figures to remain a polished practice. Stephanie Friedman, vice president of sales and marketing for City Paper Company, Birmingham, Ala., holds that there are significant ways for promo distributors to use that stat to their advantage, with the growing affinity for reusable bags and totes as a boon. Retailers value such items since they represent ongoing advertising and serve as additional point-of-sale revenue sources. City Paper Company, Friedman said, has looked to be a pioneer in helping customers to develop branded products for employees to wear and support the brand, along with branded merchandise to sell within retail stores.
“Through creative art and products that properly align with the consumer market they target, we are able to help them find additional revenue streams while building brand loyalty with customers and employees,” she said. “We see many retailers creating sections of stores committed to their brand, whether it be pillows or kids’ items, apparel, candles, socks, etc.”
E-commerce retailing has undergone a boost, too, with many enterprises starting out as internet-based platforms that sell only or mostly online. Those businesses need print and promotional products, too, including mailing bags, corrugated boxes, tissue paper, labels and print materials for shipping items out.
Friedman said many brands that start out this way (as online retailers) gain a following through social media and then decide to strengthen their identities by having products that promote their benefits. That leads to many of them eventually adding traditional storefronts or pop-up sites to build on their initial days as internet-centric businesses. And, of course, that results in even more opportunities for promo distributors.
“We all know those stores need both bags and swag,” Friedman said. “It’s a win-win when these companies are seeing success. It’s truly about thinking as big and as broadly as you can for your customers.”
Retailers are also increasingly valuing sustainablility, Friedman said, as they’re keenly aware of the ways modern consumers now want to stand behind brands that “truly mean something and bring value to the world.” The promo space has plenty of those products on offer, and distributors can pitch them as a way for retailers to really connect with consumers. Friedman is also certain that because of the uptick in delivery services and subscription programs, corrugated boxes are receiving full decoration treatment to help retailers differentiate themselves on customers’ doorsteps. As for where retail is heading, she gushed over its possibilities.
“Retail is only going to continue to grow as a vertical opportunity for distributors, though the landscape may not look solely like traditional mall shopping centers with Gap and Barnes & Noble,” she said. “I think we will see growth in the underdogs—the companies differentiating themselves with their product offerings, which will require us distributors to do our research, investigate, read and anticipate, always looking for the next big opportunity.
“Technology products will play a big role in this vertical,” she continued. “Augmented reality will become more popular, whether used in packaging, marketing materials, point-of-sale or in-store displays. Apparel and everyday useful items like drinkware, mobile accessories, bags and unique giveaways will continue to be utilized to promote brand loyalty and customer appreciation.”
Media & Entertainment
“The sheer amount of opportunities” within the media and entertainment vertical thrills Larry Shapiro. And, as president of Captiv8 Promotions, a New York City distributor that counts this market as a large chunk of its promo sales, he has needed to absorb his fair share of pop culture. For Shapiro, that’s a perk.
“Media and entertainment are interesting for many reasons, including the need to keep a pulse on what’s resonating with people now and where those interests are headed,” he said. “They’re growing all the time as a combined vertical because people are seeking distinction when they’re putting themselves out there for events and promotions.”
Answering that call for differentiation has involved Captiv8’s enthusiasm for encouraging clients to maximize their concepts by “pushing them to show who they are” through the ideas that they bring for consideration. Shapiro said distributors who wish to excel within this vertical need to be ready to invest time and money to help customers and prospects really stand out from their competition.
“Nobody wants to be an also-ran in a vertical that sees so many people eager to be individuals,” he said. “You have to out-market your competition by having that personal touch that’s going to leave clients feeling great and making them feel distinguished.”
Since the nature of the media and entertainment realm is to leave lasting impressions (much like the most notable figures within it seem to do with ease), Shapiro recommends that companies thoroughly address the depth of the consideration they can give to projects, with new companies—the ones someone would expect to have a leg up on the competition because of the general curiosity found among young workers—needing to be especially cautious not to come across as inauthentic in their enthusiasm. “Expect for your clients to be pretty knowledgeable of their given scenes, too,” he said.
Regarding the vertical’s hot products, Shapiro said he could see technology taking on a greater role, and that focusing on providing media- and entertainment-centric tech products could prove a game-changer.
“I think [the products] would have to be something like leisure time goods or accessories,” he said. “Like with everything in this vertical, seeing what could interest people next on a grand scale is exciting.”
Renee Porter, sales manager for Champion Specialty Advertising, a distributor based in Wilmington, Del., counts nonprofits among her company’s prized verticals. And while the thought of leaning on nonprofits as a targeted vertical may sound fruitless, Porter believes they shouldn’t be overlooked. Nonprofits are everywhere, she says, and even though they often require more attention, awareness and consciousness of budgets, that shouldn’t dissuade distributors from working with them.
“A great way to become a trusted company for nonprofit organizations is getting involved in our communities and with the nonprofits,” Porter said. “I’m a member of one of our local fire companies and volunteer my bookkeeping skills on their administrative side of the fire lines. I am also their vendor for apparel and other promotional items, so I am able to help keep the costs to a minimum. I’m constantly approaching other nonprofits to let them know there is a place they can come get friendly service and great products at an extremely reasonable price.”
Since nonprofit entities do not typically obsess over turning a maximum profit, and find themselves far more concerned with helping individuals and communities, distributors should focus more on offering great customer service and other benefits to nonprofit organizations and their diverse needs. And what nonprofits lack in big-time promotional products budgets, they can often make up for in referrals among their networks.
“Since we are very good at what we do, we are able to offer discounts for items, free setups and delivery if needed,” Porter said. “All we ask in return is positive word-of-mouth advertising to their colleagues in other nonprofits, [which is] kind of a way to share the wealth within the nonprofit world.”
“People want items that connect them to an event and a brand,” Tom Miller, president of T R Miller Co. Inc., Walpole, Mass., said of the emerging trend in marketing for beverage and spirits brands. “No matter what the economy is at any given point, we’re going to see consumers wanting those ties because they resonate as experiential links.”
The beverage vertical exists as a “much more personable market” than others one might try to enter, said Miller, who contends that such ease permeates interactions because buyers are looking for reliable partners who can etch lasting memories into recipients’ heads. Therefore, distributors with a knack for being go-getters and understanding what Miller sees as the trend in this vertical should find multiple opportunities for new business.
“We should never forget that this industry should be about having fun, no matter the amount of work that’s often involved,” he said. “When we’re talking about this vertical, sports and sponsored special events are great examples of ways to stand out, especially if there’s cross-branding involved. We’ve been fortunate because we understand the combination of a good time and a solid marketing campaign built around beverages or spirits is going to work when you map out everything in the beginning and don’t leave a customer thinking they’re going to have to spend that much time managing your efforts.”
“The various needs of the masses” compel Dan Webb in his role as president of Webb Company, Eagan, Minn. Those requirements have come to involve health and wellness on a grander scale within the promotional products industry, and legal marijuana goods have arrived in earnest to assist various businesses in expanding their markets’ reaches, with cannabidiol (CBD) becoming high on certain clients’ lists.
Webb assessed that numerous markets work for the distribution of CBD-centric products. Hospice, senior living, retirement homes and assisted living facilities. Athletics businesses. Chiropractors, yoga, CrossFit and wellness centers. And, especially, the cannabis market itself. Knowing there are stigmas one could attach to those interested in CBD goods, Webb aspires to make those perceptions go up in smoke.
“Buyers in the cannabis space are typically extremely professional, their establishments can be classier than an Apple store, they have money they need to spend, and promotional products are their biggest form of advertising,” Webb explained. “They typically are not looking for the cheapest swag. They are looking for high-end, good-quality promos that will set themselves apart. What we have found is the majority of cannabis companies just don’t quite know how to evolve their promos to match their brand vision.”
Webb, who touted CBD-infused mints, tinctures, water flavoring and topical creams and lotions as popular items in this category, encouraged distributors to see dispensaries, cannabis suppliers and the entertainment field as top markets. (Cannabis suppliers are especially crucial, since they’re calling on customized swag to attract business from dispensaries.) Because the “green rush” has sparked cannabis and CBD companies to focus on capturing as much market share as possible, as early as possible, Webb anticipates an even greater chance for suppliers and distributors to blaze new promotional trails.
“Society as a whole has advanced the acceptance and understanding of cannabis,” said Webb. “It’s not this taboo subject that it was five or 10 years ago.”