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Report: Promotional Products Sales Shrank 7 Percent

Study shows how the economy and PhRMA Code has impacted the $18 billion promotional product industry.

It's official: Every advertising channel has been impacted by the economy. The Promotional Products Association International (PPAI) revealed in its annual study that sales of promotional products were off 6.89 percent last year.

Despite the decrease, overall sales of promotional products totaled more than $18 billion in 2008, per PPAI’s 2008 Estimate of Promotional Products Distributor Sales. PPAI is a trade organization for the promotional products industry with over 7,500 members worldwide.

In industry had to contend with the double whammy of the economy and strict PhRMA codes, which limit how pharmaceutical companies can use products. Namely, only items that can be used for educational purposes can be given out to medical professionals.

"2008 was a tough year for many of our members," said Steve Slagle, PPAI president and CEO, in a statement. "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."

Wearables were the overwhelming top sellers (307 percent) followed by writing instruments (9 percent), calendars (7.9 percent) and bags (6.9 percent).

Least-popular items included clocks and watches (1.4 percent) and food products (1.3 percent).

The most common programs that used promotional products were brand awareness (12.6 percent), employee relations and events (11.9 percent), and tradeshows (11.5 percent).

They were used the least for marketing research programs. Less than 2 percent of companies used promotional merchandise for these types of efforts.

The study of 16,000 PPAI and non-PPAI promotional consultant companies was conducted by Richard A. Nelson of the Manship School of Mass Communication at Louisiana State University and Rick Ebel, principal of Glenrich Business Studies.

Note: Here's the link to the study.
www.ppai.org.