The $16 Billion Opportunity
During the Incentive Manufacturers and Representatives Alliance (IMRA) Marketing Conference, held from Sept. 27 to 30 at The Resort at Squaw Creek in North Lake Tahoe, CA, the big question for many members in attendance was: "Where's my share of the $16 billion?"
That number -- describing the amount spent by U.S. small businesses on incentives -- was the estimate delivered by Melissa Van Dyke, president of the Incentive Research Foundation (IRF), when she delivered the results of the "IMRA Small Business Merchandise Market Study: Understanding & Engaging the Small Business Market" during her keynote address on Sept. 28.
IMRA and the IRF worked with Intellective Group to conduct the survey, which collected the responses of 825 small-business buyers during the month of April. According to the results, 52 percent of all small businesses in the U.S. user merchandise incentives, spending more than $16 billion, albeit with smaller budgets than larger organizations, and by using more online and retail channels for their merchandise needs, as opposed to manufacturers' representatives.
"There's a great deal of need for detailed awareness of the benefits that merchandise representatives and sales representatives provide," says Van Dyke. "Seventy percent of the small-business market knew generally that sales reps existed, but only 30 to 50 percent understood the benefits that those reps provided, and 22 percent of that market had never been called on."
Van Dyke says IMRA members need to let small business know they can provide below-MSRP pricing for the right types of buyers, and that the study demonstrates the wide variety and coverage that merchandise incentives have. "There's a depth and breadth of merchandisers in this market that small businesses can use, and those small business owners who use these programs really believe in them."
Battling online retail purchases of incentive merchandise, and delivering a unified industry message about the importance of incentives, was a hot topic of discussion throughout the conference. "The expertise that reps can offer in this marketplace -- small business owners miss out on that opportunity by going online," says Van Dyke. "Getting that word out is critical."
During a town hall meeting held on Sept. 29, Ted Moravec, the new IMRA president and VP of Elite Creations, said, "We need to understand how other people view us, and how they view incentives. The word 'incentive' means different things to different people. Sixteen billion dollars is a huge number."