Fed Announces Plans To Taper Bond-Buying Program Signaling confidence in the continued recovery of the U.S. economy, the Federal Reserve announced it will begin paring the bond-buying program – nicknamed QE3 – that it has used to stimulate growth. Read Article
The decision is, by far, the most significant policy move by the Fed in 2013. After implying a coming taper this past summer, the Fed will reduce its bond purchases from $85 billion per month to $75 billion per month starting in January. More reduction will likely be planned for the future, though Fed Chairman Ben Bernanke left the door open to skip decreases if the economy does not accordingly fare well.
"We're still going to buy assets at a high rate," Bernanke said yesterday of the bond purchases, which now appear slated to end in 2014. "We're providing a great deal of accommodation to the economy."
The stock market and investors responded favorably yesterday to the announcement. Industry reaction was similarly enthusiastic. "Although the recovery is very modest, it is significant that the Fed chose to begin tapering bond purchases," says Marc Simon, CEO of Top 40 distributor HALO Branded Solutions (asi/356000). "The Fed's exhibited confidence is likely to instill more confidence in businesses, consumers and investors and holds the hope of speeding the pace of the economy's slow recovery to date."
The Fed also announced it would keep long-term interest rates at or near zero for the foreseeable future. While previously the central bank had promised not to raise rates until the unemployment rate dropped below 6.5% (which is not expected until late next year), the Fed went a step further and vowed to hold down rates well after that benchmark is reached.
One reason the Fed remains cautious about tapering too much, too quickly is because of the lack of price increases. Bernanke again expressed concern about the country's low inflation rate, which has stayed for months below the 2% marker the Fed has charted for successful economic growth. Analysts largely agree that some inflation is helpful for economic gains.
While overall reaction to the Fed decision was encouraging for markets, industry firms are still taking a pragmatic approach. "The best thing for our business is to have as much long-term visibility as possible regarding interest rates, which are obviously being impacted by the Fed decisions," says Dave Thompson, CEO of Top 40 firm National Pen (asi/281040). "While the recent news triggered a positive reaction from the market, which is great, it is really not going to impact our plans one way or another. We are making decisions with a timeframe of one to three years versus month to month."
ASI Radio: Corcoran and O'Leary Podcast On this week’s Tuesday Morning Show, the hosts were joined by special guests Barbara Corcoran and Kevin O’Leary of the ABC reality show Shark Tank. Read Article
The duo discussed business ideas and execution, the biggest mistakes entrepreneurs make and how to reduce risk. Plus,
Corcoran and O'Leary explained exactly what they look for in identifying products to invest in.
Click here to listen to the complete interview podcast. Also, don't forget that next month Corcoran and O'Leary will be keynoters at ASI Orlando on Tuesday, January 7.
If you missed any part of the radio show, a recording is now available at
www.asicentral.com/radio. And, remember to join us on Tuesday, December 24, for our next broadcast. Log on at 10:30 a.m. ET to listen to the show – and give us a call at (215) 953-4979 to hear your voice on the air.
The Joe Show: Get Charged Up
In this episode of The Joe Show, Managing Editor Joe Haley shows off some new items that will help you build sales momentum going into 2014. Read Article
Looking for a unique product that can appeal to the automotive industry? Need an inventive idea for spas and health clubs? How about a fun recognition item?
Click hereto watch this new-products episode of The Joe Show.
Counselor Commentary: Pharma Marketing Dollars Up For Grabs Earlier this week, pharmaceutical giant GlaxoSmithKline announced that it will no longer pay doctors for speeches or promotions of any kind. Read Article
Further, the company said it will be changing its sales rep compensation structure so that representatives are no longer compensated for the amount of prescriptions written by the doctors that they call on. These are transformative moves in the marketing world – ones that have been in the works in the pharmaceutical industry, but are now actually taking shape.
Surely, other companies will follow Glaxo's lead because, well, they'll have to. Ever since the Pharmaceutical Research and Manufacturers Association (PhRMA) changed its members' marketing guidelines in 2008, the pharma sector has been evolving. Sales reps can no longer simply buddy up to doctors – with payments in hand, by the way – and expect that those doctors will write prescriptions to their companies' drugs without thought of what's best for patients. And, as Glaxo's move points out, companies can no longer slip cash to doctors for low-stress speaking engagements and appearances that come with an unstated quid pro quo – you take this and agree to promote our products over those of our competitors.
Glaxo's move is ultimately a response to the Physician Payment Sunshine Act, which was passed as a provision within the 2010 Affordable Care Act. Pharmaceutical companies will now have to publicly report any payments they make to doctors that total more than $100. This includes gifts of any kind, as well as compensation for marketing, promotions, or speaking engagements. Glaxo's payments of these kind, which beginning in 2016 will become nil, totaled $15.4 million per quarter in 2009, $13.2 million per quarter in 2010, $6 million per quarter in 2011, and $2.5 million per quarter in 2012. "Many people have wondered, what difference will it make?" said Susan Chimonas, a research scholar at the Center on Medicine as a Profession at Columbia University, about the Sunshine Act. "Will it clean up practices, or just allow the status quo to continue so long as there is transparency? Glaxo's move is giving us an early answer and reason for optimism. The Sunshine law is working."
The question, then, is where will all of these marketing dollars go? Glaxo and other pharmaceutical companies still need to promote their products, and the direct-to-consumer route is where they're headed. This is the big opportunity for promotional products sellers. While pharma companies are decreasing (and in some cases eliminating) payments to doctors, they're increasing their efforts at convincing consumers to request their products from doctors. That's where live event marketing and new product launch promotions (two of the calling cards for promotional products) will become paramount for these companies.
We've already seen the pharmaceutical industry begin to spend again on promotional products. After PhRMA passed its new marketing guidelines, the pharmaceutical sector fell from accounting for nearly 5% of distributor annual revenues to representing just more than 1% of overall distributor revenues in 2009. That huge drop, noted in Counselor's State of the Industry survey, has begun to rebound and the sector accounted for 2.5% of ad specialty revenues last year. With Glaxo's move – and the shifting of marketing budgets happening in the industry overall – it's clear that the pharma market will continue to rise as an opportune target for promo products companies.
New Signage + Decoration Pavilion Coming The ASI Show™ and ST Media Group International will debut the new pavilion at ASI's Chicago show July 15-17 at McCormick Place. Find out more. More Free Education
Facebook To Launch Video Ads
Marketers will have a potentially powerful new medium for reaching target audiences: Video advertisements embedded in Facebook users' news feeds. Offering a new way to promote everything from products to movies, the video ads were being tested this week with a small group of Facebook users. "Rather than having to click or tap to play, videos will begin to play as they appear onscreen -- without sound," Facebook said in a statement.
When users tap the videos, audio will be enabled and the video will play in full-screen mode, according to reports. During piloting this week, Facebook worked with Summit Entertainment on ads to promote its new movie, Divergent. Once green-lighted for wider distribution, the video ads could fetch Facebook as much as $8.4 billion per year in revenue, analysts predict.
Since September, Facebook's tech team has been trying to improve video capabilities. The social media site declares that views, likes, shares and comments increase when content starts playing automatically. Nonetheless, questions have arisen about how Facebook users will react to automatic ads. Last month, a survey by global marketing consultancy Analytic Partners found that 83% of users would find video ads "intrusive" and would likely "ignore" them.
Facebook's advice to people who don't want to see the videos? Quickly scroll past them.
4imprint Announces Top Customer-Rated Products
A duffel cooler, sport flyer and tote bag are among the top 20 promotional products of 2013, according to Counselor Top 40 distributor 4imprint (asi/197045). Buyers rated these products the highest on 4imprint's website throughout this year.
"Customer feedback is so important to us," said Greg Ebel, vice president of sales and marketing for 4imprint. "These reviews come directly from customers who've purchased and used these products, making it invaluable information for anyone interested in finding new imprinted items for their next promotion, event, tradeshow or other activity. Being able to consider the feedback from tens of thousands of people who have actually purchased promotional products is something people consistently tell us is important to them."
The annual ranking includes 11 products that appear on the list for the first time. Earning a five-star review, the convertible duffel cooler is a 600-denier polyester duffel bag that has a main compartment with a U-shaped zipper closer that holds up to 12 cans, plus ice. The sport flyer, another highly-rated item, is a nine inch disc that can hold a standard paper plate at a sporting event. Also making the cut is a durable two-tone tote bag – a 600D polyester item that can hold notebooks and conference materials in its main zippered pocket, as well as smaller items in the front slip pocket.
Some of the other items that made the list are the economy pocket coolie, the color banded classic coffee cup, the side-blocked micropique sport-wick polo and the cell phone power bank.
Counselor How-To: Managing Millennials
Every generation of workers has a unique set of skills, but the talents of Gen Y employees – those born between the 1980s and the early 2000s – could be especially helpful to your business. Why?
"The Millennial brings an enormous amount of tech savvy to the business," says Morley Winograd, co-author of Millennial Momentum: How A New Generation Is Remaking America. "If you're not currently engaged in social media and if you're not doing a lot of business online, Millennials can bring that inherent knowledge which exists as a native language compared to a learned language. That's a big plus."
If you're thinking about hiring Gen Y workers or have already done so, click here for some suggestions for maximizing their full potential at your company.
Legislation Aims To Prevent Job Applicant Credit Checks
A new measure introduced by U.S. Senator Elizabeth Warren (D-MA) and co-sponsored by five other legislators would ban companies from conducting credit checks on most prospective employees. The bill, named the Equal Employment for All Act, would outlaw the checks in many fields, with limited exceptions like for jobs related to national security.
"There's little or no evidence of any correlation between job performance and a credit score," Warren said. "This is a point of basic fairness. People who get hit with hard economic blows end up getting squeezed out of the system."
A research brief released by the Demos Foundation, a liberal think-tank, notes that one of the most common reasons for bad credit is the loss of a job and health insurance. Those losses, consequently, make it a challenge to pay bills on time, Demos found. A Demos report also shows that one in ten unemployed Americans have been denied a job because of information in their credit reports. Many of these checks are run on applicants seeking entry level positions.
However, trade groups like theConsumer Data Industry Association defend the use of applicant credit checks as a basis for preventing embezzlement and fraud. Data from the Association of Certified Fraud Examiners estimates that each year there are about $1 trillion worth of employee thefts – an average of $175,000 per business. That figure increases to $200,000 for companies with fewer than 100 employees.
Counselor Unveils Best Places To Work
At the inaugural Counselor Best Places to Work Conference, held recently in Santa Barbara, CA, Counselor magazine announced its 2013 ranking of the best workplaces in the industry. With a list of 85 distributors and suppliers, the Counselor Best Places to Work this year is headed up by supplier firm Crystal Impressions by Seaena (asi/47782). "It's truly a great honor to be number-one on the list," said Allison Robbins, one of the company's owners, upon finding out about the ranking. "We're a fun company that we all love spending time at."
Rounding out the top five on the 2013 Best Places to Work list are: Proforma Albrecht & Co. (asi/116308), Beehive Specialty (asi/135780), Royal Crest Promotions (asi/83740), and Clean Fun Promotional Marketing (asi/162979). Click here view the complete ranking of the 2013 Counselor Best Places to Work list.
Vote In The Wearables Apparel Design Awards
Each year, Wearables names the best apparel and accessories in the industry – and we can't do it without your help. Your votes will determine the winners of our annual Wearables Apparel Design Awards. Choose the products you think are the best, considering design appeal, wearability and overall look.
Click here to vote. Voting will take place throughout December. And be sure to check out the February issue of Wearables to find out the winners.
In The News
Brother will be offering new customers of the GT-3 series digital direct-to-garment printers the option of signing up for Inksoft Business Tools Pro. Inksoft Business Tools is offered at four different levels of its design and business management software, but options include an online designer, the ability to prepare and send quotes, generate invoices, get art approvals, and a multipurpose scheduling calendar. For more information about Inksoft Business Tools Pro, go to http://www.inksoft.com/business-tools/.
IDProductsource (asi/62088) has added a new line of lanyards to its promotional product offerings. The lanyards can be found exclusively on ESP under #62088 pricebuster.
Logomark (asi/67866) announced it invested more than $2 million in equipment and training in 2013, honoring its pledge to meet distributor expectations of timely delivery and exceptional service.
Norwood (asi/74400) & BIC Graphic (asi/40480) recently participated in the Community College to Career tour alongside Second Lady Dr. Jill Biden and Labor Secretary Tom Perez at an event at Broward College in Florida where they met students and toured labs and classrooms.
Prime Line (asi/79530) announced it will hold a webinar on Thursday, December 19, from 2:00-2:30pm EST. President Jeff Lederer will identify emerging trends and markets for the coming year as well as share related selling ideas, case histories and new product videos. Distributors can register here: http://bit.ly/18m5TyJ.
People On The Move
Jetline (asi/63344) announced the promotion of Jon Granek to northeast regional sales manager. Granek's territories will now include NY, PA, MD, DE, NJ, CT, MA, RI, NH, VT and ME.
National Gift Card (asi73011) has appointed Liz Wheeler as a vice president of business development. Previously director of business development, Wheeler will manage the company's inside sales team, oversee sales growth of the existing client base, and work to improve development of new markets and customers.
Summit Group (asi/339116) has announced that, following a merger, Robert Silk, president of MCS Graphic Productions, has joined the company. Other additions and promotions include: Mark Becker as group president; Frank Izurieta as director of client services in the Atlanta office; Dan Robinette as director of sales in the Atlanta office. The company also announced that Jill Hood, who is the firm’s director of strategic initiatives, has been selected to serve on the Special Expertise Panel for Technology for the national Society of Human Resource Management for the 2014 term.
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ONLY 16 DAYS UNTIL ASI ORLANDO
Thousands of distributors are headed to ASI Orlando for the first show of 2014 taking place Sunday, January 5, through Tuesday, January 7, in the North Hall of the Orange County Convention Center. Register today and plan to take advantage of everything that ASI Orlando has to offer!