The Imprinted Boomerang Effect
Does the thought of selling stress balls have you popping anti-anxiety pills? Do you cringe at the sight of blinking logo pendants or run in fear from foam hands? Relax, you’re not alone. The prospect of bringing assorted novelties to sales calls is enough to make some business printing professionals rethink their careers. Change is never easy. But by and large, it is usually positive, and the $19 billion promotional products industry is increasingly providing life support for flagging distributorships. Those who are successfully adding customized advertising and marketing tools to their product lines are focused on serving customers’ objectives, not simply supplying promotional objects.
David Kolko, president of Rochester, New York-based Proforma IF Print Services, had a few former sales reps who balked at the company’s decision to transition into promotional products. Some viewed it as no more than a means to secondary income, others considered it a chintzy sell. “I think they’re out of their minds. The biggest thing in the print industry is value-added services. Promotional products still allow you to bring the added value to your customer ... [and] differentiate yourself from the competition,” said Kolko. “Anything can be professional or unprofessional depending on your approach. The cream always rises. People who walk away are not only turning their back[s] on a profitable segment of the industry, but also a fun and innovative one.”
Kolko’s father, Wilfred Kolko, established the distributorship in 1975, and for more than 25 years the company specialized in business forms, mailers and checks, with the financial and healthcare markets accounting for the lion’s share of the orders. “We really started seeing the decline around 2000, and began testing the waters of promotional marketing,” he continued. “We found it to be an industry that matches our industry—maybe not 100 percent, but they are very interrelated. There wasn’t a heavy retraining cost. The models work the same, and our customers were already using promotional products.”
Despite occasional requests for promotional items, Kolko and his team had no idea how to effectively source the products, and lacked a competitive edge. Nevertheless, the company began extensive research and networking and obtained its own ASI (Advertising Specialty Institute) number. Kolko soon discovered many manufacturers were reluctant to do business with a distributorship just getting started in the promotional products industry. In addition, every order had to be prepaid. “Even for a [larger] distributorship [prepayment can] hold you back, so there were orders we didn’t feel we were capable of taking,” he commented. “Many of the vendors also treated us like novices—which we were. We didn’t know the terminology or quite understand how things worked.”
It wasn’t until Kolko joined Cleveland-based Proforma in 2002 that the promotional marketing side of his business took off. “The network of manufacturers is the biggest [advantage] in promotional products, and suddenly we went from having no supplier network, to having [more than] 200 promotional products vendors dying to do business with us,” he recalled. “And, we [then] had the end-quantity pricing needed to compete on a large scale.”
Mike Peters is another Proforma franchise owner whose transition into promotional products was made easier by membership in the organization. He and his business partner had owned a commercial print shop for 20 years when they decided to move from producing product to brokering and distribution, and established Proforma Diversified, Meridian, Idaho, in 2004.
“Although we had been asked a number of times to help our clients with promotional items, we had never grasped the real value of doing so. Part of the decision was driven by those requests, and the other part was realizing the potential for additional sales and profits,” said Peters. “Because we had been printing for many clients and had the necessary artwork, we received requests for such things as business cards, magnets, pens and calendars. These are items that nearly all of our customers use. When we found ourselves being asked to provide artwork for promotional items and apparel, we began to ask if we could be considered to provide those products.”
Like Kolko, Peters initially felt his lack of experience dealing with promotional products was a disadvantage. “There is a learning curve just like any new venture, but the transition—with the help of Proforma—was easier because of the support personnel ... and the relationship Proforma has with vendors.” He also acknowledged the benefits of having a large company’s considerable buying power behind him. “Although there are expenses to get started, I have been amazed at how much help our vendors are willing to provide at little or no cost to me,” he said.
Beyond the Buzzing, Blinking and Beeping
Kolko described promotional products as a different, but enjoyable sell, involving creativity and marketing. The most frequently requested items include writing instruments and mugs, as well as wearables for events and company stores. “The promotional marketing and [business printing] marketplaces work virtually the same as far as distributors, manufacturers and end-users. Even the requirements—it’s print; you can figure it out. It is not as complicated as it seems,” he observed. Kolko went on to say that adding promotional products enables distributors to be true, full-solutions providers. “You now can sell to anyone, even [accounts] you couldn’t sell [to] before because they had a forms management contract. It is a wide-open game again,” he explained. “And, you may have a better shot at the print side once the contract is up if the customer is happy with how you handle[d] the promotions piece.”
In 2002, 95 percent of Kolko’s orders were for forms and commercial printing, and 5 percent were for promotional products. At the time, the company’s goal was for the split to be 50/50 within seven years. “Right now, we are 52/48, and that is in five years. We thought promotional products would only be at about 30 percent, so we’re thrilled,” he said.
Peters finds selling promotional items to be challenging, but enjoys problem solving and being able to find the right products to help his customers achieve their marketing and promotional goals. “It is a natural thing for me to ask my clients if there is a way we can help with their upcoming trade show or company picnic. The doors open a little easier when you have a relationship and can ask those questions,” he commented. “It’s a different approach in that, unlike printed items that I am very familiar with, I have to remind myself to get the answers to some different questions in order to provide the correct pricing, and eventually, the right product.”
Kolko recently worked with a major food manufacturer on a promotion designed to acknowledge the efforts of supermarket chains during a successful new product launch. The customer wanted something “different” that could relate back to its product, and yet fit within the guidelines of what the stores were permitted to accept as gifts. “We came up with a digital photo frame with a USB plug that you can load pictures on to. We pre-loaded it with images of the customer’s product, included a nice thank-you note, and then handled the fulfillment and mailing to end-users,” explained Kolko. “The pre-loaded images are what sold the customer.”
Kolko has since acquired the customer’s commercial printing business. “[Printing and promotions] are such complementary things; you can make them work well together,” he said. For distributors uncomfortable with taking the leap into promotions, he suggested starting with pens, stationery, calendars and other items more closely related to traditional products. Wearables, he cautioned, involve a lot of little details, and can be very confusing for the uninitiated.
Kolko himself is a firm believer in the power of promotions. “We have our own delivery service, and always keep [customized] pens on the truck. When making a delivery, we have people sign the packing list with pens imprinted with our name and number, and then give it to them as a little gift,” he explained. “Does it drive business? Maybe, maybe not—I just want to keep getting our name out there.”
Said Peters, “If I can increase sales and profits in my business by adding promotional items to my product mix, I have made what I call a good business decision. Now, my visits to our clients are with the understanding that they may be spending more money for promotional items than they currently spend with me on print. My client has a need and I provide the product. I have given them more reasons to keep our relationship strong and more and different orders coming in.”
