Citing a direct reflection of the tough economy that has affected advertising media across the board in 2009, distributor sales of promotional products declined 13.61 percent from 2008 to 2009, reaching $15.639 billion, the lowest since 2002, according to the Estimate of Promotional Product Distributor Sales annual study, released last week by the Promotional Products Association International (PPAI), based in Irving, TX.

However, the drop was less than other media, including direct mail, newspapers, consumer magazines and billboards, said Rick Ebel, principal of Glenrich Business Studies in Corvallis, OR, who conducted the study exclusively for PPAI with Professor Richard A. Nelson, Ph.D., of Louisiana State University.

"A 13.6 percent sales drop isn’t good, but it looks pretty good compared to other media," said Ebel. "The biggest surprise was a 15.6 percent drop in sales for direct mail, which hadn’t had a loss in modern times until now. The fact that all media suffered in 2009 doesn’t make it better, but at least we know that our industry’s sales decline wasn’t an anomaly."

Larger companies with sales of $2.5 million or more experienced a smaller decrease of 2.35 percent over 2008, while smaller companies saw a huge decrease of 22.62%. Sales by product category didn’t show any major swings up or down regarding product preferences, while program categories that registered increases of more than 2 percent were Dealer/Distributor and New Customer/Account Generation segments, while Employee Relations & Events dropped nearly 3 percent from 11.87 to 8.73.

Other media that saw considerable loss were print advertising with newspapers losing 28.6 percent in advertising sales and consumer magazine ad revenue dropping 18.1 percent. Billboards sales also dropped 15.6 percent last year and internet advertising, which had been growing in double digits in recent years, was down 3.4 percent.

Not all the news was bad. The study also showed that distributers are optimistic about 2010, with more than 60 percent of those surveyed predicting that 2010 would be a better year, while only 14 percent felt it might be worse.

In addition, "an upswing in this year's first quarter sales reported by industry firms seems to be carrying over into the next quarter," said Steve Slagle, PPAI president and CEO. "While it’s still too soon to tell whether or not 2010 will be a marked improvement or not, it’s already proving to be much better than 2009."

Margin of the error for the survey was +/- 1.89 percent at the 95 percent confidence level. The methodology includes a combination of census and a sampling of industry distributors. To see more study results, click here. This page is protected by Copyright laws. Do Not Copy