Counselor Commentary: Forget The Naysayers

Ad Specialty Industry Doing Just Fine

Andy CohenThe U.S. economy has been taking a PR beating over the past six weeks – starting with a punch-to-the gut, no-real-progress-here jobs report in early September and escalating to a political street brawl over the debt ceiling this month. Consumer confidence, according to the latest Thomson Reuters/University of Michigan survey, has dropped to its lowest level since January. Even the seemingly invincible services sector has taken a step back, with the Institute for Supply Management's September market index slipping unexpectedly. Guess we should load up Noah's Ark, huh?

Alright, let's be clear – while the data isn't screaming "recovery, all is well," it's time for a little perspective. We're now five years removed from the Lehman collapse, U.S. advertisers will spend more than $170 billion on paid media this year (per eMarketer) and with the Dow above 15,000, everyone's 401(k)s are looking a whole lot better. No, the economy isn't fully healed, but if it were a patient after surgery, we'd see it getting out of bed.

Consider also the evidence from the Fed's newest Beige Book – frankly one of the best indicators of coast-to-coast economic trends – that was released yesterday. Some highlights of the report: The housing and automotive markets are gaining strength, consumer spending and manufacturing is picking up and business investment is growing. Capital spending, in fact, which has generally weakened over the past year, is now predicted to increase in the months ahead.

Meanwhile, the ad specialty industry – knocking on the door of $20 billion in annual revenues – is in a strong position for current and future growth. This is not just opinion, it's what distributors are actually seeing. The preliminary results of ASI's Q3 sales report shows 48.3% of distributors had stronger third-quarter sales this year than they did in 2012 (vs. 22% that had a sales decrease). A full 55% of survey respondents expect their 2013 sales will be better than their revenues last year.

In Counselor's recent survey of Power 50 members, the industry's leaders were also optimistic. "The first half of 2013 was decent, and the second half appears to be stronger, much better than we projected," said Bill Korowitz, CEO of The Magnet Group (asi/68507). "The reality is most businesses are driven off the economy, and the economy is doing well," said Derek Block, CEO of Touchstone (asi/345631).

Look, there are some sectors stuck in neutral, but where others see distress, you can be the one to find opportunity. Retailers' earnings, for example, have been nothing short of lackluster recently. Needing a strong Q4, wouldn't retailers – big and small – benefit from some great gift-with-purchase ideas for the holidays? Polls show heads of many mid-sized firms are worried about the pending costs of The Affordable Care Act. Couldn't a savvy distributor step in, set up a rewards program and help firms motivate their employees to follow healthy habits?

Listen, amid all the drama, here's our bottom-line advice: Seize the day, forget the naysayers and go make your fourth quarter a memorable one.