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Promotional Products in the US Industry Market Research Report from IBISWorld Has Been Updated
Date:5/6/2013

Los Angeles, CA (PRWEB) May 06, 2013

The Promotional Products industry has turned the corner following the financial crisis, posting gains in the past four years. In 2013, industry revenue is expected to increase 0.4% as marketing budgets expand and the industry benefits from new promotions as consumers begin to spend again. Nevertheless, IBISWorld estimates that industry revenue will fall at an annualized rate of 2.1% to $13.7 billion over the past five years as a result of a decline in media expenditure and the loss of a key downstream market. According to IBISWorld industry analyst Austen Sherman, in 2009, pharmaceutical companies introduced self-imposed rules prohibiting the distribution of non-educational promotional items, removing themselves as industry clients. This loss, combined with decreased advertising dollars, drove revenue down 14.5% in 2009 because the pharmaceutical market had accounted for 11.0% of industry revenue.

The majority of industry revenue is generated through the distribution of specialty advertising products. Operators specializing in this service do not manufacture products; they purchase “blanks” from industry suppliers and customize them according to client needs. “Unfortunately, industry globalization has made it easier for clients to go directly to the manufacturers by making overseas factories more accessible to end buyers, allowing clients to bypass industry firms altogether,” says Sherman. In addition, consumer safety laws, such as the Consumer Product Safety Improvement Act of 2008, have increased the cost of insurance and product testing. These trends have caused the Prom
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