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Strategy

Promotional Products Sales Report 2019 – West

The draw of affordable living and job availability offers a robust path to growth.

America’s population trends continue to heavily reflect the allure of the Western states. With a high concentration of cities known for their booming tech industries along with a strong component of tourism, it’s no wonder that in the Census Bureau’s report of the fastest-growing states by percentage, six of the top seven can be found out west: Idaho, Nevada, Utah, Arizona, Washington and Colorado.

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The reasons? Job availability, affordable cost of living and changes in lifestyle. “Cities such as Portland and Seattle are seeing the combination of a boom in the technology and creative marketing industry, as well as a growing want for outdoor activity and green space,” Michael Stoll, an economist at UCLA, told Move.org.

Seattle added nearly 34,000 tech jobs in 2016 and 2017, making it the country’s fastest-growing tech hub.

Even though California isn’t on that list, it still added nearly 158,000 residents last year – the third most behind Texas and Florida. And with the state’s unemployment rate reaching a record low of 4.1% last fall, the competition for workers is having a dramatic effect on promotional product buying. California’s so-called talent wars – a term for companies that go to great lengths regarding job perks, vacation time and parental leave to attract the best employees – “are crazy here in the Bay Area,” says Sam Brown, director of corporate marketing at San Jose-based BrandVia (asi/145037). The Counselor Top 40 distributor works with a strong roster of HR and talent management among the area’s many Fortune 500 companies, with employee appreciation and onboarding being the two more prevalent reasons for promo purchasing.

In Nevada, the sales environment is “very, very strong,” says Josh Kozinski, chief business development officer for Sky High Marketing (asi/328476), which has offices in Las Vegas and Milwaukee. “Assumption number one is always that gaming and hospitality are very important in Nevada. We’re strong in those – and customers spend a fair amount there – but you also have telecommunications, manufacturing, healthcare and financial industries growing as an offshoot.”

Jedd Parker, president of Rain City Promotions (asi/304502) in the Seattle area, says his company does business with some of the largest tech companies in that area. In fact, the Emerald City is the fastest growing tech hub in the U.S., according to real estate company CBRE.

Parker says construction continues to be a big area of interest for his company as well. According to the Seattle Times and Washington Office of Financial Management, apartment and housing construction has taken off inside the city while the surrounding suburbs have seen a similar decline.

Click here for a larger image of the map above. 

Parker says he sees business remaining similar in 2019, with one exception: “People are concerned with being healthy and in shape,” he says, “so there are gyms popping up all over the place. We do a lot of custom socks.”

Drew Davis, owner and president at Denver-based Specialty Incentives (asi/331870), says his company has experienced growth not only on the Front Range of Colorado (places like Denver, Boulder, Colorado Springs and more), but also in places like Cheyenne, WY, and Glenwood Springs, CO. Financial clients, hospitality and fast-casual restaurants continue to boost Specialty’s bottom line in those locations. “We’ve also acquired some business from a national distributor in the oil and gas space,” he says.

Next door to Colorado, business is also booming: In an area between Utah’s capital, Salt Lake City, to Provo, rest the so-called Silicon Slopes (an Inc. magazine feature declared in 2018 “Move over, Boulder!”). This hub is home to Cotopaxi, Qualtrics and Chatbooks, and the state ranks sixth in the nation in per-capita venture dollar volume, according to Crunchbase News.

Not all Western states are feeling the love. A study published by USA Today ranked New Mexico 48 out of 50 on its list of best states to do business, citing 20% of its population living in poverty compared with 14% of overall U.S. residents. Bob Sisson, owner at Zuna Corp. (asi/366150), a commercial printer and distributor located in Albuquerque, NM, notes the discouraging trend, but with government business and tourism as the state’s two main industries, “it’s still a service-oriented business,” says Sisson. “I don’t see a huge change in the near future, but I think business is out there for anybody who wants to go get it.”

To facilitate buying, distributors should follow Brown’s advice and focus on the reasons people are buying, not what they’re buying: “They rarely call up and say, ‘Hey, I want a bottle or a T-shirt.’ We’re trying to turn it around and stop talking about product categories.”


Hot List

Hot Category: Drinkware

Drinkware is still a huge market in Colorado and elsewhere, says Drew Davis of Specialty Incentives. “As practitioners, we have to continue to ask the appropriate questions,” he says, “and the water bottle you pitch has to be better than anything they have in their cabinet right now. You have to have a willingness to separate yourself from what’s being used.”

Hot Trend: Social Entrepreneurship

“Activism is a strong cultural trend,” says Sam Brown of BrandVia, noting an increase in suppliers and products with give-back components. “As a society, we’re seeing that people want to do better for the future – for their fellow humans and the planet,” Brown says. “This is translating from the basics of choosing recycled or upcycled goods to the fundamental purposes of business.”

Hot Offering: Company Stores

Jedd Parker of Rain City Promotions says more people are showing interest in company stores – which presents its own set of challenges. “You need the capital to invest in 500 tumblers and decorate them as they go. If folks want to place an order for one tumbler, it requires an investment from the customer and the distributor, and that’s something few customers are willing to make.”

Hot Strategy: Thoughtful Gifting

Brown says she recently saw an approach to onboarding she described as “ingenious” – the company sent branded water bottles to the parents of new hires. “It wasn’t about the bottle that was in the box,” she says, “but about the thoughtfulness." Giving the parents a great impression of the company where their kid has his or her first job was – to borrow a phrase from millennials – an “epic” way to congratulate mom and dad for helping their kid get this far.

Sarah Protzman Howlett is a contributing writer for Advantages.