Arizona Promotional Products Association. Town Hall. Welcome! PROMOTIONAL PRODUCTS ASSOCIATION INTERNATIONAL. Paul Bellantone, CAE, President/CEO

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1 PROMOTIONAL PRODUCTS ASSOCIATION INTERNATIONAL Arizona Promotional Products Association Town Hall Welcome! Paul Bellantone, CAE, President/CEO

2 PROMOTIONAL PRODUCTS ASSOCIATION INTERNATIONAL PPAI advocates for the use of the most effective & efficient medium in the advertising industry promotional products. 110 years of service member-driven, board directed, staff managed international trade association not-for-profit

3 Our members 10,600+ corporate members six dues-paying categories $15k - $400 million one to 1,000 workers varied go-to-market strategies 28 decorating/imprinting methods make, decorate or sell

4 PPAI advocates visibility viability credibility community

5 We re continuing to customize the PPAI member experience Small What can we give you to do better business Medium How can we help you do better business Large What should we be working on together

6 Our industry 18.5 billion industry 432,000 professionals 32,000 businesses 23,000+ distributor companies 4,000+ supplier companies 4.4% overall annual growth

7 Distributor growth 96% less than $2.5 million <$2.5 million had 1% growth >$2.5 million had 8% growth 50/50 revenue split

8 Industry growth recovery & 3 consecutive years of growth $18.5 bil Revenue in $ Billions

9 Distributor landscape 81% less than $250,000 in sales 92% less than $500,000 in sales 95% less than $1 million in sales 96% less than $2.5 million in sales 99% of distributors <$10 mil 4% report 50% of industry revenue

10 Supplier landscape 76% report less than $1 mil 49% less than $250k 26% between $250k - $1 mil 20% between $1 - $10 mil only 5% report more than $10 mil 96% of suppliers <$15 mil 4% report 38% of industry revenue

11 Distributor market realities uneven & inconsistent 70% growth 50% profitability size, geography, seasonality

12 Supplier market realities

13 Product trends 29% wearables 8.7% bags 8.6% writing instruments 7% drinkware 4.4% desk/office/business 4% awards & recognition (+3) UP food gifts, textiles, personal pocket/purse & buttons, badges, ribbons DOWN calendars, electronic devices, magnets, stickers & decals, sporting goods, automotive

14 Usage trends 11% business gifts 9% brand awareness 8% trade shows 7.7% employee relations 5.6% cause marketing 5.4% dealer/distributor programs

15 Buyer trends 14% healthcare 11% education 8% manufacturing & distribution 7.8% financial & insurance 6.7% technology 6.3% association/clubs/civic groups

16 Share of market Media Method % Chg Direct Mail Television Internet Point-of-Purchase* Cable TV Consumer Magazines Newspaper Promotional Products Radio Sports Marketing Business Magazines Billboards Product Placement Mobile Phone Advertising Total

17 Share of market 8th largest U.S. advertising industry $18.5 billion advertising sales 3 consecutive years of growth 4.4% annual growth Up to 50% greater recall rate than other major media

18 It s Just A Matter Of Fact. Promotional Products Work!

19 The Influence of Promotional Products On Consumer Behavior Airport Intercept Study Return On Investment Where They Are Used Affect On Perception Frequency Of Use Business Impact Length Of Use

20 The Influence of Promotional Products On Consumer Behavior Frequency Of Use 53% use promotional products once a week or more often

21 The Influence of Promotional Products On Consumer Behavior Length Of Use Time Among Those Keeping Promo Products for Up to 2 Years 23% For about a month 16% 13% For about six months 29% 7 to 12 months For more than a year 18% At least 2 years 47% keep promotional products for more than a year

22 The Influence of Promotional Products On Consumer Behavior Take Action * In addition to 100% brand awareness! 35% refer to promotional products for contact information

23 The Influence of Promotional Products On Consumer Behavior Retention & Acquisition Of those surveyed 55% had done business with the advertiser BEFORE receiving a product. Of these, 85% have done business with the advertiser AFTER receiving a product.

24 The Influence of Promotional Products On Consumer Behavior Retention & Acquisition 45% had NOT done business with the advertiser BEFORE receiving a product. Of these, 11% have done business with the advertiser AFTER receiving a product. To Sum It Up Whether acquiring new business or strengthening existing relationships, there is a strong correlation between promotional products & success.

25 The Influence of Promotional Products On Consumer Behavior Affect On Perception 59% had a more favorable impression after receiving a promotional product

26 The Influence of Promotional Products On Consumer Behavior They Keep Them 54% at home 24% on them 11% at work 5% in car 3% at home office

27 The Influence of Promotional Products On Consumer Behavior One In Four walk around with a promotional product

28 How Media Compare On Reach, Recall And Reaction Staying Power Up to 50% greater recall rate than other major media Source Promotional Products & Other Media: How The Media Compare On Reach, Recall And Reaction

29 Price of success Tangible, powerful & influential promotional products are an easy target for empty sound bites.

30 Price vs. Value Price should only be the deciding factor when value (risk) is equal to ZERO

31 Price vs. Value Control the Conversation Become Brand Partner Offer Campaign Design Demonstrate Effectiveness Promote Safety Assure Delivery Deliver Quality

32 What buyers want Preparation Do your homework. They resent questions that can easily be found on the web Simplicity Make buying simple without being simplistic Creativity They have their own ideas. They want new ideas that don t exist in their world Contrary to popular belief, B2B customers are less interested in price than in these six things. Loyalty They risk their companies by doing business with you. They want you vested in success Accessibility They want you to get back with them immediately Accountability The buck starts and stops with you

33 Differentiate Stand apart from the crowd by aspiring to deliver more than the basics.

34 Differentiate Story Empathy Symphony Design Meaning Fun

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38 Corporate social responsibility Product safety & responsibility Socially-conscious business practices Environmental sustainability

39 Emerging Challenges Increasingly buyers & government agencies are demanding more from our industry Address 3 elements product + people + planet

40 Member Survey Results 1 The PPAI Expo 2 Lobby efforts at national & state levels 3 Product safety & regulatory issues 4 Business partner programs 5 Industry research & statistics

41 We Are In The Brand Protection Business Compliance with Federal & state regulations is not optional It can be a strategic advantage & increase your value to your customer

42 PROMOTIONAL PRODUCTS ASSOCIATION INTERNATIONAL Take 3 small steps

43 Adopt the PPAI Code of Conduct

44 Commit To Education

45 Demand Compliance From Your Trading Partners

46 The Goal Ensure EVERYONE learns about the regulations Education accessible to ALL members Build compliance into all systems & programs Increase the industry s VALUE to our channel partners by ensuring all systems are COMPLIANT Fortify ourselves & our channel partners as hard targets

47

48 PPAI Board Candidates 13 Distributors Jon Levine President The Image Group Suppliers Rick Mouty Chief Executive Officer TSC Apparel Mary Jo Tomasini, CAS Chief Executive Officer CE Competitive Edge LLC (UPIC: EUINC) Bruce Perryman, MAS+ Chief Executive Officer Embroidery Unlimited, Inc.

49 Change True professionals don t fear amateurs Farmers don t begrudge backyard gardeners Mechanics don t fear do-it-yourselfers Technology advances allows new entrants True professionals use the shift to move up the food chain Professionals bring more than just good tools Don t get scared get better! Seth Godin

50 PROMOTIONAL PRODUCTS ASSOCIATION INTERNATIONAL Thank You Paul Bellantone,

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