T's and Mugs Still a Good Bet in 2011: Staples Q&AJanuary 5, 2011
Promo Magazine - Companies consolidating agencies; tremendous pressure to produce ROI; and sales falling like shooting stars. This may sound bleak, but despite lots of change the promotional products industry is still humming. In 2009, about $16 billion was spent by companies working to imprint their brand logos in consumer psyches by passing out branded pens, T-shirts, cups, mugs and other stuff. Staples, the largest promotional products distributor in North American with 40% of Fortune 1000 and other customers of all sizes, is prepared to march forward.
Barbara Wells, Senior Vice President for Staples Promotional Products, talks about how the year is shaping up and the changes the industry is undergoing.
PROMO: How is the role of promotional products companies changing?
WELLS: Mid- to large- customers are becoming brand partners. It's not just about selling product anymore. Our role is to show customers how to use promotional products as marketing tools: How to integrate these products within an integrated brand initiative and to develop messaging. We are developing analytical tools that give customers better access to total marketing communications and solutions on how use these tools to build incremental sales. We also go in together with the ad and brand agencies to figure out how to use all mediums to tie to the brand strategy and that's been a major change over the last few years.
PROMO: How much consolidation is taking place?
WELLS: Within the large companies we're seeing a lot more RFPs. Within all companies there is tremendous pressure to continue to improve the bottom line. Large companies are looking to consolidate from as many as 10 to 12 promotional products companies to one or two and getting the best price for that consolidated spend.
PROMO: What role is social media playing?
WELLS: We see social media as a tremendous means for business development and relationship building. As a relationship building tool Staples business development directors use LinkedIn, which has more than 80 million members, to develop customer groups online. We use the groups to explain Staples capabilities, post tailored messaging and to find and add additional customer contacts to those groups. We also have "hunters" who use LinkedIn to find the major decision makers within companies and to represent our brand as a solution provider.
PROMO: What impact is social media having on your business?
WELLS: We're just in the beginning stages of using social media in our industry. The goal is to use social media as a business development tool, but right now it's about awareness and gaining access to contacts within our major client targets.
PROMO: Do you use other forms of social media?
WELLS: We use YouTube, Facebook and Twitter for messaging, education awareness and product ideas. Facebook has not been as strong a medium as Twitter. In September, Staples used the lure of a charitable donation to encourage Twitter followers. We're all in the very early stages of how we use these mediums. It's a good way to make connections. The key is linking all of these technologies together and educating all of our sales people on how to utilize these tools to develop better contacts. We also have to develop company guidelines on how to use these tools.
PROMO: How do you keep customers informed about product safety and compliance standards?
WELLS: We use all digital technologies to do that. It is so important to make sure we are covering social compliance, product safety, price increases, what's happening with cotton and many other issues. We communicate these issues to customers through smart papers, our quarterly newsletter the "Promo Report." We also use Facebook, YouTube and Twitter, which are all linked to our websites.
PROMO: How is price impacting purchase decisions?
WELLS: Price is No. 1. It's becoming more important because companies must show savings.
PROMO: When customers ask, ‘How will I determine my return on investment?' what is your response?
WELLS: Promotional products are one of the lowest costs per impression of any advertising medium and are used to increase brand recall and evoke a favorable impression. But there are differing expectations: One can be related to a specific event that relates back to a sales number, for example, if a promotional product is specifically use to create sales for the release of particular item you can tie ROI back from that. But in many cases promotional products are used to create favorable impressions and increase recall. The key is making sure that the promotional item meets the brand expectation.