promotional products are the most highly regarded form of advertising

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2 ParsonsKellogg and Driving Impressions operate in two industries: the promotional products industry and the incentive marketing industry. Both companies do the bulk of their business in the promotional products industry, which is comprised of two competing membership organizations the Advertising Specialty industry (ASI) and the Promotional Products industry (PPAI). ParsonsKellogg is an industry distributor, generating revenue through specialty advertising on everyday items and apparel purchased blank from suppliers such as Driving Impressions. Demand for specialty advertising products, driven by growth in corporate profit and total advertising expenditure, is expected to grow in the coming 5 years; promotional products will continue to be favored by companies due to the repeated exposure of the brand to potential customers. 9 of 10 consumers recall the brand on a promotional product they received When asked what types of advertising they liked best, customers under 55 all preferred promotional products On average, customers keep a generic promotional product for close to a year Consumers want products that are both attractive and useful promotional products are the most highly regarded form of advertising

3 Our in-house resources make vendor partnerships turnkey and allow us to help you control volume and sales opportunities to align with your long term strategies. We deliver clients from brands that align with your personality and ensure the integrity of your corporate identity while introducing your product to the promotional products market.

4 Problem: You have a business opportunity in a market you don't know, or you want to expand into a specific target market. Solution: Turnkey vendor services from Driving Impressions and ParsonsKellogg strategically open up sales channels that reach the corporate market.

5 the backbone the backbone Driving Impressions provides controlled access to the corporate marketplace for Patagonia. When Patagonia receives a new application for a promotional marketing program, they forward their contact to DI, who in turn manages program fulfillment. Using DI as their backbone to reach ASI distributors, Patagonia can trust their products will end up in the right hands.

6 the the gateway ParsonsKellogg controls volume growth and brand integrity to the larger corporate market through three sales channels: Approved PK corporate clients who can choose to include Patagonia in their promotional products portfolio Vertical-specific websites targeting new markets like hunting, fishing, healthcare, and beer that fit within Patagonia s branding strategy Shop PK, ParsonsKellogg s online store By sourcing products through Driving Impressions, PK also removes supplier-distributor markup costs, passing on savings to clients that result in client retention.

7 The promotional products industry is extremely difficult to navigate if you are not an operator in the space. The path from manufacturer to end-user can vary brand to brand, and even to from product line to product line. The following road maps are example paths for some of PK s largest brands, to provide some color around the process overall as well as our competitive advantage over other distributors. DISTRIBUTOR marketplace no access EXCLUSIVE DISTRIBUTOR end client

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9 golf team sporting goods team dealer Exclusive supplier Any supplier ANY DISTRIBUTOR EXCLUSIVE DISTRIBUTOR end client

10 greengrass golf apparel team apparel greengrass golf apparel pk/di only corporate apparel team dealer any supplier EXCLUSIVE supplier ANY DISTRIBUTOR EXCLUSIVE DISTRIBUTOR end client

11 The Promotional Products industry has experienced a low level of technological change in recent years, with the exception of a major shift toward online ordering systems. Promotional products companies who sell online pose the largest competitive threat to traditional ASI companies, who risk being too cumbersome with their model to respond to online competition. The growth of e-commerce and the continued development of online business has allowed both distributors and manufacturers to begin to offer their products online, reaching beyond the corporate market into small business, sole proprietors, and the consumer marketplace. Online catalogs and ordering/payment systems have and will continue to make it easier for users to source promotional products particularly products typically unavailable in corporate catalogs - directly from manufacturers and suppliers, a trend that has seen an upswing but has yet to significantly damage distributor revenue. In 2014, 4imprint s (North America second largest distributor at close to $500M in Revenue with no outside sales reps) revenue improved roughly 25% as the company experienced aggressive growth in its online sales and marketing segments. Wages will also see a drop in the five years to 2021 as distributors move operations online, reducing the need for sizable outside sales teams. In 2016, wages account for 37% of enterprise cost in the industry; a significant decrease will increase profit margins in the coming years. With the launch of Shop PK and DI Store (our new e-commerce services), ParsonsKellogg will be one of the first distributors to buy into the e-commerce trend. While other distributors may lose out to suppliers providing direct to clients, DI provides a revenue buffer for ParsonsKellogg as the company s supplier division. Both ParsonsKellogg and Driving Impressions have relationships with vendors that provide them access to styles and colors outside of the corporate catalog selection further ensuring we will be less-likely to lose business to manufacturer sales.

12 MAJOR COMPETITORS Both ParsonsKellogg and Driving Impressions compete in saturated markets. We ve featured a few of our core competitors here; competitors specific to each business line will be listed later in this document. PARSONSKELLOGG ParsonsKellogg, in theory, competes against all other ASI distributors in the industry, dependent specifically on the service line. Given our direct access to premium brands and their retail styles and colors unavailable on the promotional products market, along with our turnkey service model, we glean a competitive advantage over many of our competitors. SIMILAR COMPANIES E-COMMERCE COMPETITORS how PK stacks up

13 DRIVING IMPRESSIONS Driving Impressions competes against each and every registered ASI supplier in the market. That said, very few of these suppliers keep a core focus on premium brands, which positions DI in a smaller, niche market. The following core competitors are a short list of the companies we commonly see in our marketplace. APPAREL GOLF EQUIPMENT MAJOR SUPPLIERS DI vs the field

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15 BUSINESS AND REVENUE MODELS ParsonsKellogg is positioned in the market as a go-to partner for premium and emerging golf and sporting goods brands, with Driving Impressions acting as a core supplier in this same market. While PK and DI are both full-service in terms of the breadth of the product categories offered, both companies feature premium/luxury brands and golf equipment, apparel, and accessories as a core offering comprising a large portion of each gross revenue, respectively. As a distributor, ParsonsKellogg provides its services to end-users (corporations and consumers), while Driving Impressions works to supply its goods and services to other distributors in the industry. dropship custom website microsites shop pk vendor sites category sites corporate templates dropship Di store total 2106 Numbers $13,500,000 $2,100,000 $1,000,000 $--- $--- $--- $--- $10,900,000 $--- $27,500, PROJECTIONS $16,500,000 $2,500,000 $1,000,000 $3,000,000 $1,500,000 $500,000 $500,000 $8,500,000 $4,000,000 $38,000,000 Number of items n/a 100+ less than n/a $1,000 target customers platinumbronze key all platinum/ all premium key gold categories all all all vendors target volume $50,000 $50,000 $50,000 $2,000 $50,000 $50,000 $10,000 $1,000 all business and revenue models