By Bruce Bolger, for the Brand Media Coalition
- Part I: Executive Summary
Part II: The Handbook for Brand Media Specialists
- Introduction: What You Need to Know to Be a Brand Media Specialist to Help Your Clients Profit From the Power of Brands
- The Importance of Program Design
- The Research Basis for Brand Media
- The Concept of Brand Personality
- The Critical Role of Communications
- Customization, Personalization, Experiences
- Types of Non-Cash Rewards and Brand Considerations
- How Resellers Make Money With Brands
- Where to Source Brands for Organizational Use
- Part III: Bibliography
Download a PDF of this White Paper:
- Brands and retail gift cards are the most powerful media for business, event, promotional gifting, incentives and rewards and are rapidly growing in demand in the $20 billion business, event and promotional gifting business.
- Organizations overlook the storytelling power of brands and the benefits of a more disciplined analysis of the brands selected for gifts, rewards or travel, and how their careful curation can affect the emotional impact and storytelling power of programs.
- Organizations carefully consider and analyze the media or mobile venues where they advertise and the companies with whom they co-market or support events or causes. Most scrutinize the brands they select for contest/sweepstakes prizes and related promotions, the events they sponsor and the loyalty programs in which they participate or offer to customers. Much consideration is given to the type of products or the destination and venue in non-cash incentive and motivational event programs, but most organizations overlook this process in one of the most powerful one-on-one engagement tactic of all: gifting and rewards.
- Promotional products distributors can make just as much money on brands for business, event and promotional gifts because of the significantly higher volume per order and the expertise involved with brand media selection that can warrant additional fees.
- This eBook is designed for business, event and promotional gifting, incentive, reward and recognition planners seeking to enhance their programs by tapping into the power of the new Brand Media in giving and rewards and elevating their own value to organizations by becoming Brand Media Specialists.
Audience for the Brand Media Specialist learning and certification program: This report is specifically addressed to the “trade” (i.e., suppliers and resellers of non-cash rewards, incentives, recognition, business gifts, travel and experiences) and for professionals who seek to formally become Brand Media Specialists. These include promotional products distributors, incentive, recognition and loyalty firms, as well as professionals at marketing agencies and engagement firms. By the trade, we also mean brands, gift cards and master fulfillment companies seeking to profit from the $20 billion market for promotional gifting that has largely avoided brand-name products until recently. Part I, the Executive Summary, is for CEOs and high-level executives who don’t necessarily need all the details; Part II is for practitioners serious about best practices in Brand Media; and Part III, the Bibliography, is for those even more serious about appreciating the wide range of research from around the world (including Saudi Arabia and Taiwan) that supports the theory behind the new Brand Media. This eBook contains all the information needed to pass the online test to become a certified Brand Media Specialist.
Sources for this white paper: “The Untapped Power of Brand Media” is based on a meta-analysis of over a dozen studies conducted over the past three decades in multiple countries, along with additional studies contained within those studies. See the Bibliography, coming soon, for complete references and links.
The challenges facing use of non-cash gifts and rewards:
- The focus on product, price and technology have all but commoditized the use of non-cash awards in traditional incentive, loyalty, gift and event businesses. In many cases, the proliferation of choice and the retail redemption experience have turned many gift, incentive, recognition and loyalty programs into “cash-equivalent” programs that are in effect disguised compensation or pricing tactics because price is transparent.
- Online shopping and meetings management technology have created a zero-sum game out of product and price selection for both merchandise and travel.
- In the meantime, a recent IRF study, 2019 Voice of the Market and Use of Non-Cash Rewards and Recognition, found that almost no organizational end-users rely upon their incentive or reward solution-providers for program design and, even more notably, are unaware that any such expertise exists. The study found that these planners rarely network with colleagues in other industries using such programs, do not consistently benchmark practices other than their own competition, and at the same time feel quite satisfied that they’re doing it right. Probably no other area of marketing, management or media in which so much money is spent escapes so much scrutiny in terms of objectively measured return-on-investment or benchmarking of best practices.
- While most product planners say they often consider the issue of brands selected for programs, until the Brand Media Coalition’s Brand Media Guide, no one has published information describing brands in the way organizational users need to see them--i.e., as a media platform with a story, personality and demographic audience. It takes an average of one hour or more to find, compile and make sense of branding and storytelling information even on a leading, well-known brand because no one has compiled such information. More information will be added in the coming months to these profiles. While organizations scrutinize branding, content and audience demographic data of almost all other media in which they advertise or with which they co-market, they often go by hunches and overlook the brand analysis process with gifts and rewards, even though the cost-per-thousand for these programs is far higher than any other media and almost always involves an organization’s most important stakeholders, be they valued customers and distribution partners, or employees, charities, board members, investors, etc.
1) End-users are so uninformed about best practices, they don’t even know it. Brand Media Specialists can profit by addressing the fundamental lack of knowledge of end-users about:
- The importance of program design and the considerable science now available.
- The return-on-investment measurement and potential prescriptive analytics now possible based on the correlation of behaviors and results in gift and reward programs.
- The ability of this industry to provide more value than gift and reward products, services and catalogs alone.
3) Brand Media Specialists can help elevate the selection of brand media to at least the same level as product selection or even to the selection of any other media used in advertising and marketing, co-marketing, event partnership, or affinity marketing programs when organizations better understand the impact of the gift or reward experience.
4) The Brand Media Coalition will educate brands on how they can leverage the IRR, loyalty, and promotional industries to further tap and enhance the value of their own brands, create a valuable business-to-business distribution channel wherever and to whomever their products or services are available at retail or online, and benefit from valuable exposure and trial with an audience identified as motivated by their brands.
What Brand Media Specialists Need to KnowThe issues related to Brand Media aren’t much different from product selection except for the storytelling involved: the process requires an understanding of the client’s brand, objectives, personality and its audience and the ability to match with other brand stories. Here is an overview of the topics a Brand Media Specialist must address that are detailed in Part II.
The traditional reasons for distributors to overlook brands is long gone. While the margins are half or less than for promotional products, the average volume of each sale is higher by a magnitude of 35X or more. Such programs often require brand selection, customization and personalization or catalog curation that command additional fees, and they often afford cross-selling opportunities. Offering brands enhances the value and even the brand perception of promotional products distributors or of any marketing, incentive, or recognition solution-provider that becomes a Brand Media Specialist, and does not require any change in the traditional sales cycle and business model distributors are accustomed to.
Non-cash rewards need to meet a high bar because of the cost-per-thousand. Gifts, incentives, rewards and motivational events, whether brand-name or not, have by far the highest cost-per-thousand of any media, so organizations have a significant interest in maximizing impact through best practices and by measuring the results. Even if clients don’t ask for return-on-investment measurement, suppliers should build such gauges into their platforms anyway. It’s often relatively easy to correlate reward redemptions with activities, groups and individuals, and compare the correlations to provide useful insights, and it always helps to have ROI measurement should new management come on the scene.
Gifting and program design are critical. Whether it’s simply a gift program or a complex employee or channel engagement strategy, a strategic and systematic approach to program design will yield far more tangible results, a better return-on-investment and more useful information that can be applied toward the improvement of subsequent efforts. Ad hoc, or basic “do-this, get-that” programs usually cannot be accurately measured and risk having the unintended consequences of rewarding people who would have performed anyway or promoting deceptive or unproductive behaviors. Brand Media Specialists need to be ready to warn clients of design pitfalls, even if not called upon to serve in a consultative capacity.
The gift and reward experience are critical. Research and common sense confirm that it’s the actual way in which a gift or reward is selected, delivered and experienced that has as much impact as the product or experience itself. Ask any client on what basis they’re designing their gift or incentive program, or what science underlies it, and chances are the answer is that it’s based on their “personal experience” or “what we did in the past.” Sadly, that’s often good enough for most organizations, until the next-generation CEO comes in and asks about the strategy and ROI supporting these programs.
Brands matter when it comes to reward, gift, destination and venue selection. The proper selection of brands for a given audience and program, as well as products and services, will have a direct impact on the emotional connection, memorability, appreciation, story-telling power and buzz within the audience. Brands tell a story that can make an emotional connection by demonstrating that you understand your valuable customers, distribution partners, employees, vendors, communities, shareholders, etc. This applies as much to group and individual travel as it does to any other gift or reward media.
Brands enhance perceived value. There is a direct connection between a person’s knowledge and connection with a brand to buy and recommend it and often to pay more, supported by at least a dozen or more independent field studies from around the world, and probably many more we did not find.
Brands have a personality that tell a story. Not only well-known international brands but any brand tells a story to its community of prospects and customers. The more “authentic” the brand (i.e., true to its values), the more people will feel loyal and even willing to pay more for its products or services. Studies indicate it’s not good enough to be trusted as a category leader to benefit from the referral power of “authenticity.” This concept translates into the perceived value of receiving the brand as a gift or reward as well.
Brand curation is largely taken for granted. With the exception of planners of sweepstakes/contests, affinity marketing and loyalty programs, practitioners don’t give as much conscious attention as they should to the specific selection of brands in their gifting, incentive, recognition and loyalty programs. How could they? There was an almost complete dearth of information available on brands delivered in any consistent manner until the publication of the Brand Media Coalition’s Brand Media Guide, covering over 117 years since the industry’s first trade magazine, Premium Practice, was founded in 1904 by Bill Communications. (It is now known as Incentive.) Plenty of information exists on product and service specifications, down to weight and dimension, or capacity of the meeting room; rarely is there information on demographics or the story or history of the brand name behind it with which to better select brands and enhance the presentation to the participant (or client for that matter.)
There are established psychological underpinnings for the use of non-cash rewards and gifts distinguished from compensation and pricing. According to the Incentive Research Foundation’s “Award Value Program Value Evidence Study” (2019, Schweyer, A.; Landry, A.T. PhD. Candidate, University of Quebec, Montreal, and Dr. Whillans, A., Assistant Professor, Harvard Business School), several psychological factors come into play with motivation that can be addressed with properly-used non-cash rewards and gifts. These include what is known as Mental Accounting, the effect of comparing effort with compensation, which can be offset by proper use of non-cash rewards; what is known as Social Signaling or “trophy” value, the satisfaction of sharing success; Perseverance--psychologically attractive awards have been demonstrated to foster greater stamina than cash compensation alone; and the Reciprocity Effect, another problem caused by cash that commoditizes relationships. These effects can be offset by properly designed gifts and incentive reward programs that trigger intrinsic satisfaction beyond pats on the back and thank-you notes, which alone run out of steam over time.
Beware of the dangers of improperly used non-cash awards and gifts. The same study identifies that non-cash rewards can lose their impact over time if repeated without variation, based on the principle of “hedonic adaptation.” Another risk is lower aspirations due to a phenomenon at least one study identified in which participants who sought non-cash rewards were willing to set lower goals to achieve them than for cash rewards. The use of non-cash rewards with employees living at subsistence rates, which is the case at many organizations that have minimum-wage employees, must be done gingerly and selectively to respect the recipient’s need for cash to meet daily needs. Just as importantly, non-cash or cash rewards used in “do-this, get-that” schemes that fail to address all the levers of engagement and promote the right behaviors often end up rewarding the same people over and over or can promote brand-damaging behaviors with lasting negative impact. (This is an even bigger risk with cash incentives.) Business gifts always must be offered in a transparent, “surprise and delight” manner, with no explicit or implicit quid-pro-quo, respect all policies of the recipient’s organization and, as importantly, respect cultural norms in the country, region, or community in which they are given.
Brand integrity and distribution compliance are mandatory. Every brand has or should have rules related to how its brand is used by other companies as gifts, incentive, rewards, recognition, loyalty or charity prizes. Larger companies have brand manuals that many of their own employees do not know exist. Some brands are sensitive to the types of companies with which they wish to be associated-- i.e., tobacco, firearms, cannabis, sexual content, political causes, etc. Others are sensitive to how their products are imprinted or customized. Almost all are sensitive to their distribution channels and do not wish to see their products or gift cards being sold off-price online, at unauthorized retail outlets, or exported. Anyone selling brands for organizational purposes needs to be sensitive to these requirements or risk losing the right to sell those brands, or to become known in a very small industry of suppliers as an untrustworthy brand distribution partner. It’s the same care advertising agencies must take in the placement of their clients’ ads.
Brand Media expertise cannot be commoditized. When one considers the thousands of brands, retail gift cards, travel destinations and venues in the world of international, regional and local merchandise, planners face a dizzying choice, much like they do in any other media. The specialists in the Brand Media business—the brand special market divisions, the master fulfillment companies, incentive representatives, promotional products distributors, marketing agencies, etc.—can help organizations not only identify the right brands using the Brand Media Guide and other sources, they can help source them from authorized brand wholesalers with the capabilities to handle drop- or bulk-shipping, customization, personalization, etc. If an organization decides to use a retail source for an organizational program, ask to speak with the company’s corporate sales department. See Where to Source. links to section below in Part 2.
Part I of this eBook is for the CEOs of promotional products distributorships, incentive, recognition and loyalty companies, and fundraising firms seeking to understand the strategic opportunities of using brands as a media for business, event and promotional gifting, as well as rewards, recognition, loyalty and fundraising. Part II is for the actual practitioner, or Brand Media Specialist. Here readers will find additional details on the research basis, implications and actionable steps Brand Media Specialists can take to help their clients or organizations profit from the power of brands as a medium to enhance the long-term impact of any type of business, event, or gifting program, merchandise, gift card, digital, or motivational event, or incentive travel program. This white paper also provides all the information one needs to prepare for the Brand Media Specialist certification exam, to be available shortly. The more that organizations understand the potential upside of properly designed and implemented incentive, reward and gifting programs, as well as the risks of poor design and implementation, the more they will respect the experts with the experience and analytics to provide informed recommendations.
The Art and Science of Engaging Rewards, published by the EEA; in the Incentive Marketing Association at IncentiveMarketing.org learning and certification program for incentive programs; the learning and certification program of Recognition Professionals International at Recognition.org for recognition, and the Loyalty Academy for loyalty. For additional information on program design for gifting, read the EEA’s white paper on The Art & Science of Corporate Gifting (coming soon).
Introduction: What You Need to Know to Be a Brand Media Specialist to Help Your Clients Profit From the Power of Brands
What Brand Media Specialists Need to Know About Program Design. Why is program design so critical? Because failure to address research-based effective practices can easily lead to expensive and even dangerous unintended consequences of awards or gifts, such as repeatedly rewarding the people who would have achieved the goals anyway; discouraging or de-motivating the 60% who know they’ll never win; creating a climate of program addiction, depriving your organization of precisely the flexibility properly designed programs offer; and worst of all, encouraging bad behavior, such as internal competition or forceful or manipulative sales tactics, fudging of data, manipulating purchase policies, or pushing clients to change buying patterns to rack up points during promotional periods.
Beyond knowing the full dangers of poor program design, Brand Media specialists should know:
1. Gift and reward programs will have the best qualitatively or quantitatively measured results if they’re part of a comprehensive strategy and tactical plan that addresses all levers of engagement in a systematic way.
2. Any “closed-end” design, in which only the top performers get rewarded or gifted, virtually ensures that the middle 60% (from whom you could achieve incremental performance) will give up out of the gate or assume they are of lesser value to you. The best gifting and award programs specifically address the people with the most ability to improve performance.
3. Any type of gift program that requires a specific quid pro quo must be part of a formal program available to all qualifying people or it borders on (or is) a bribe. The best gifting programs are “surprise and delight” programs timed to remind the individual of their importance to your organization in a meaningful way. The gift could be a random act of kindness, an apology, or a very specific thank-you.
4. Any type of gifting, incentive, or recognition program that fails to address the other factors involved with engagement (i.e., communication, learning, community and collaboration) will fall short. No one would think of giving someone an unwrapped gift or one without a personal note; the same attention should be given to all elements of gifting, starting with the “why?” and the ROI, even if it’s a qualitative rather than quantitative ROI. Even if a client rebuffs the importance of return-on-investment measurements, the solution-provider would be wise to include whatever measures are possible just in case new management comes along wondering what the money was spent for.
5. Make the distinction between rewards, recognition and gifts vs. cash compensation. Even though generally material, digital, or experiential in nature, non-cash rewards and gifts actually are designed to address people’s intrinsic desire for appreciation and recognition in a more compelling way than encouraging words and pats on the back, which lose steam over time if not periodically reinforced with tangible appreciation. Also, confusing an audience by trying to offer non-cash rewards and gifts to address compensation and pricing issues is a common cause of “program addiction” or disaffection.
6. In surveys, people will always in large percentages say they prefer cash for multiple reasons, but mostly because people trust cash and are suspicious of anything that smacks of a substitute. Asking people how they prefer to be inspired and made to feel appreciated is similar to asking if they’d prefer six weeks to two weeks of vacation. Anyone inclined to ask people how they prefer to be recognized—cash versus non-cash—is by the nature of the question viewing the program as compensation and should stick with cash if that’s the case.
7. Just like many other professions—financial services, advertising, healthcare, tobacco and alcohol, accounting, gambling, etc.—there is much room for abuse in the gifting business, especially because of the power of properly selected gifts. These programs work so well that they border on illegal unless conducted with the wholesome intent of recognizing the human beings valuable to your business in a transparent way that is appropriate to the culture of their country, region and (most of all) their organization. The best customer gifting programs are based on a strategy consistent with the organization’s brand and culture (and that of the industry) and are linked to a performance milestone or accomplishment, never to the receipt of a purchase order. No gifting program should ever create the sense that it plays any significant part in the reason the organization does business with you beyond, for example, the impact of a gift one head of state or CEO gives to another at an important meeting as a gesture of good will.
8. Understand the distinction between recognition and compensation, which is critical to determining the appropriate type of award or to use cash instead. If the goal is to demonstrate genuine appreciation for performance in a way that resonates across the organization and with the recipient’s significant other, the gift or award should be non-cash. If the goal is to compensate or pay someone for work or a goal achieved, there is no better currency than cash.
9. Understand the concept of “cash equivalents.” For some reason, many professionals want to use some currency other than cash but then select what are in effect cash equivalents: retail-equivalent catalogs offering almost total choice with little or no personalization or customization of the reward experience, or gift cards sent or given in a standard envelope with no personalization. Why not just give cash with a nice note?
10. The principles of intrinsic and extrinsic motivation. There is much debate in organizational psychology and in human resources circles about the roles of intrinsic (inner, self-determined) motivation vs. extrinsic motivation powered by material desire or needs. This is a relevant discussion to gifting, because, in fact, gifting can, ironically, provide a way of fostering intrinsic motivation. Many people, such as author Dr. Alfie Kohn, deride efforts to manipulate people through extrinsic rewards because of the well-known risks for destructive behavior and competition. Others argue that material rewards are needed from time to time as “intrinsic” rewards in the sense that they can, when properly used, substantiate the sincerity of the organization’s appreciation. (Praise and pats-on-the-back begin to ring hollow if an organization is, over time, parsimonious with material manifestations of that appreciation, as talk can be perceived as “cheap,” especially when it involves the workplace.) Either way, research and common sense suggest that addressing both an individual’s extrinsic and intrinsic motivators makes sense over time.
What Brand Media Specialists Need to Know to Help With Brand Media Selection The primary role of the Brand Media Specialist is to help organizations select not only the right merchandise, gift card, digital code, destination, venue, and experience, but the right brand. This means that the Brand Media Specialist must have the following information to make the best recommendations:
1. The type of company of the client; its industry and the audience involved with the gift or reward program. This seems obvious, but this is also important because some brands have restrictions on which industries they will supply.
2. The goals of the gifting or reward program, the ROI or other measures, in other words, the “whys”.
3. Has the organization ever done something like this in the past and what was learned?
4. What is the brand’s key story, values, culture and how does this gift or reward program fit into that? What brands does the client’s company emulate or admire and why? Or, if the organization were to sponsor an event, what types of other brands would it wish to see involved?
5. What is the composition of the audience in terms of demographics, culture, education and most-frequently-used communications platform: office computer, smart phone, posters near the time clock or in the lunch room, etc.? What brand names does one see in the lunchroom, company events, or in the parking lot?
6. If appropriate, how will the gift/program be communicated, personalized, customized?
7. How will the gift or reward be delivered: in person, in front of an audience, or one-to-one? Will it be shipped to the home or office, or is it an experience that can be enhanced with special concierge services, upgrades, room gifts and/or notes?
8. In the best of circumstances, what does success look like?
- The recipient of a gift or award is almost always is a top performer and/or critical to an organization and likely an influencer of one kind or another.
- It is quite likely that family, friends and colleagues could hear favorably (or unfavorably) about the gift or reward directly or through social media.
- There is the potential that this person could be talking or thinking about this gift or experience for weeks, months, years and sometimes a lifetime.
- Rarely, with the exception perhaps of Super Bowl ads or remarkably memorable advertising campaigns, does a medium have more impact on an individual than what occurs when one receives a properly selected gift or award, nor the longevity in terms of its use or display. A television received as a gift for exceptional performance may be enjoyed for up to a decade, long after any Super Bowl ad viewed on it is forgotten.
A meta-analysis of about a dozen research studies over the past 30 years on the impact of brand names on purchasing decisions and trust, detailed in the bibliography, and in those of the studies researchers cited, finds that:
- Brand equity has a direct impact on product/service selection and that people with faith in a brand will pay more when all else is roughly equal.
- If a brand name is not involved, price, quality and service become the drivers.
- Brand equity helps organizations recover more quickly when hit by a short-term reputation challenge.
- The greatest brand equity comes from organizations viewed as “authentic,” which the research defines as “true to their values.” Being a reliable category leader alone does not appear to create customer advocates.
- Every brand has a personality, from an internationally known brand such as Google, Amazon, Zappos, or Tesla (often personified by the CEO or effective advertising and other marketing) to local businesses and service-providers. People love (or even hate) the company based on their perception of the CEO, and yet many haters still use it for the convenience, price and customer focus.
- Affiliation. The proximity of a brand or a person to another brand or person has a rub-off effect, explaining why advertisers have become so concerned about the online content around which their ads appear.
The concept of brand personality comes in to play because it provides a more accurate means of characterizing a brand—beyond the gut instinct often applied—and thereby finding the ones that best reinforce your client’s own brand story.
Jennifer Aaker, a behavioral psychologist and the General Atlantic Professor of Marketing at Stanford University, has published a framework she calls the Five Dimensions of Brand Personality that, while by no means definitive, provides an interesting way to evaluate individual brands based on five basic criteria:
1. Sincerity: down-to-earth, honest, cheerful.
2. Excitement: daring, spirited, imaginative, up to date.
3. Competence: reliable, intelligent, successful.
4. Sophistication: upper class, charming.
5. Ruggedness: outdoorsy, tough.
By reviewing an organization’s website, advertising and other marketing, sales and talent requirement materials, annual report (if a public company) or Sustainability or Corporate Responsibility Report, etc. and rating it against each of Dr. Aaker’s criteria on a one to five scale, for instance, one can paint a pretty good composite story of a brand.
For example, not much research is needed to come up with a defensible description of Apple using this framework. Most would probably agree that the company is:
- Low- to mid-range on sincerity
- High on excitement, competence
- Mid-to upper range on sophistication (but not elegant)
- Mid-to-high range on ruggedness—neither dainty nor all-out rugged.
Marketers use very sophisticated data analysis about where to place their media advertising or what companies to participate with in co-marketing programs and events, even though people don’t even pay much attention to advertising or the marketing at events. People pay a lot more attention when they receive meaningful gifts from an employer or customer than they generally do to an ad or billboard. By looking at their own brands or that of their clients through the lens of their personalities and looking for other brands that tell similar stories, organizations can take the program beyond the “carrot” or tangible gift to support an ongoing narrative and build a closer emotional bond than could be accomplished alone by any other media. Program designers in the sweepstakes, contests, affinity marketing and event business often go beyond product and venue selection to consider brands. The Brand Media Coalition and the Brand Media Guide are designed to make that process easier for everyone in marketing. The conclusion is simple: When making gift and reward decisions for any application, consider the brands selected as well as the products, services and venues to enhance the story-telling power of the program.
People everywhere today are bombarded with information. If the critical people involved with every aspect of the gift or reward don’t know their roles, chances increase for a hiccup that damages the recipient experience and the very reason for the program in the first place. Today, gift and reward cloud-based technology platforms can not only automate these processes but provide valuable prescriptive analytics based on correlating how people interact with the platform and what they accomplish in terms of performance over time.
Based on this benchmark, for the benefit of saving a few dollars per important stakeholder most loyalty, incentive and even many gift and recognition programs often do little to customize and personalize the reward experience, and fail to consider the most appropriate and impactful way to communicate and present the gift or reward, thereby missing a low-cost way to enhance the long-term benefits in terms of the recipient’s emotional connection and loyalty.
Unbeknownst to most organizational management and even to many promotional products distributors is the fact that most major brands are available at wholesale or discount pricing, in some cases directly through the brand’s or retailer’s corporate sales or special markets department (often by way of a designated regional incentive representative), as well as through multiple master fulfillment companies, some of whom have sophisticated customization, personalization, drop- or bulk shipping, and analytics capabilities. (See the Brand Media Guide for detailed profiles of a growing number of them.)
Customization and personalization: Merchandise brands are frequently used as business, event and promotional business gifts, as well as rewards, recognition and loyalty awards, and yet only about 15% are delivered with the creativity and thought that research and common sense dictate creates the extra meaning that inspires people to talk up, share and remember the experience. Depending on the type of merchandise, customization and personalization should be considered in:
• Communications before receipt of the gift of the award, if appropriate.
• The presentation and delivery that research indicates can provide a significant lift.
• Whether or not your company’s logo should be displayed on the shipping box in which it or some of element of a travel program is delivered; if the reward or gift should be wrapped or have a customized packing slip, etc.
• Also consider “kitting,” or putting products together in unique combinations that anticipate the accessories an individual might desire to accompany the main gift. Note that some brands have restrictions on if and how their products can be imprinted, but that usually doesn’t affect the ability to customize and personalizing packaging and communications.
Gift Cards Most national, regional, and local retailers offer gift cards, which through careful selection can escape the traps of cash equivalents—a phenomenon most prevalent in gift cards because people almost always know the actual cost give or take a few percentage points. (The cash equivalence is precisely why gift cards are generally cited in surveys as the No. 1 preferred gift or awards, but this also can defeat the purpose of non-cash rewards, which is precisely to avoid confusion with compensation and pricing.) Gift cards have the value of ease-of-presentation or distribution and the impact of wallet-power in that the person will be potentially carrying the card for a while, especially if it is reloadable. Because few people outside of the trade know about the corporate marketplace for brands and gift cards, many buyers are known to purchase gift cards at local retailers, when in fact there are master fulfillment companies and others featured in the Brand Media Guide that can provide customization, personalization and support services, drop-shipping and some pricing advantages for qualified organizational applications other than re-sale.
Customization and personalization: Gift cards afford the lowest-cost ability to enhance the recipient experience, including the ability to put a company’s logo on the card (generally for larger orders) and easily customize the card carrier and letter enclosed, if a printed or plastic card. Gift cards also come in digital versions, many of which can easily be customized with messaging, branding, and even a survey or element of gamification.
Travel and Experiences Once again, research and common sense converge on the simple fact that experiences, as opposed to things, touch a different part of the emotional cortex in the brain given the combination of senses involved. While organizations put tremendous thought into destinations for meetings and incentives, the concept of branding is often considered at the “gut” level rather than using any of the basic tools used by media planners in other fields. As the destination branding legend Ben Baker has advocated for years, destinations are brands as much as are hotels, airlines, venues, entertainers and experiences. Obvious examples are New York, Las Vega and, San Francisco, which tell different stories, but the same reasoning applies to the way any destination is marketed. There is as much an opportunity to consider branding in the world of travel as there is in merchandise and gift cards. Travel and experiences can consist of groups or individual awards, the latter of which often can be offered in the form of gift cards and vouchers.
Customization and personalization: In travel, the customization and personalization experience extend from the gift or reward selection; the pre-trip communication; the on-site communication; the departure; and post-trip experience. Each touchpoint is an opportunity to expand the experience.
The margin issue. The No. 1 reason cited by distributors for not selling brands usually involves margins or markups. While the margins in brands are much lower, the dollar volume of the sale can be as much as 35X or more higher, given that the average promotional product costs $1, and the minimum average gift for employees is about $35, with the average cost for customers as much as double that or more. At one time, and still occasionally, distributors could earn up to 40% on the average order of promotional products, which is about $700, but those orders add up over time. While margins for distributors have significantly declined over the past decade for multiple reasons, they are still higher than in the business of brands and travel, in which the margins can range from 5% to rarely up 30% in categories such as timepieces. For gift cards, margins can range from 1% to, in a few cases, up to 10%, excluding much higher margins available for customization, personalization and curation and purchasing services.
For travel, margins range from about 10% to 15%. Considering the much higher average cost of a business gift, and with companies in the $1 million to $5 million in sales spending several thousands of dollars a year and large companies spending in the hundreds of thousands of dollars in gifts, the margins are highly competitive with promotional products based on simple math: there is more to be made on 10% of a $10,000 order than 30% on a $1,000 order, especially when both involve essentially the same amount of work. Another consideration for some distributors is that brands may or may not be part of their contracts with traditional buying groups and thereby don’t involve the usual service charges.
Customers are increasingly demanding brands. Brands such as Yeti, S’Well, Bulova, Northface and others have demonstrated that there is significant demand for brands in the promotional categories, despite their much higher price. The research department of the Advertising Specialty Institute says the increasing use of brands is one of the hottest trends in the industry as of 2019.
The need for expert selection, customization and personalization creates opportunity. Once customers understand the importance of Brand Media and the gift and reward experience, most will pay more for the added value of expertise and reliable execution, analysis and measurement, for the same reasons companies pay fees to media buying companies for analysis related to ad placement.
Less fear of channel conflict. For many years, promotional products distributors wanted nothing to do with brands because the incentive industry lacked the system provided by the ad specialty industry institutions to reduce the potential for channel conflict. This issue is now almost moot in the promotional products market, with the advent of the Internet; entry of major companies such as Staples into the field; and the ability of some distributors to “disintermediate” unbranded suppliers by importing non-brand-name products directly from China or other countries. The master fulfillment companies, brands and gift cards simply do not have the sales footprint to compete with distributors or other resellers to reach end-users, and almost only do business with end-users when a major consumer company in the field comes to them verifying their policy is not to do business with resellers.
Such companies would rarely entrust the management of a major brand fulfillment company to any but the largest, most experienced full-service fulfillment companies anyway, due to inventory financing requirements. Simply put, the master fulfillment companies, gift cards and brands don’t have the sales and marketing resources or motives to compete with distributors because they don’t have the sales resources and likely never will. The corporate business is only a small percentage of the business of most consumer and retail brands, and the ROI of having a full-time sales force for this market selling to end-users has rarely if ever paid off ,even for organizations with the resources to try.
The need to reduce confusion of brands for gifting with sale for use in incentive programs. Representing many of the entities in the incentive business involved with educating distributors on the incentive business since the 1990s, I can safely say that most of the education to distributors was related to their selling incentive programs using brands rather than their selling brands for business, event and promotional gifting. The industry did such a good job of that, most distributors today associate brands only with incentive, recognition and safety programs. Given the resistance at the time to selling brands in general, it’s unlikely that educating them on using brands to replace non-branded merchandise or as business gifts, given the other constraints mentioned, would have yielded much success, especially because there are other reasons that many distributors will never get involved with incentive, loyalty and recognition programs. Among them: the sales cycles are much longer; much more expertise and customized technology is involved; the money flows in regular trickles instead of lump sums when they come through redemptions from points-based sales, employee, or loyalty programs; and much more ongoing support and hand-holding may be involved, etc. This may explain why under 10% of distributors sell incentive programs, despite nearly 30 years of education programs on the subject. In contrast, selling brands simply leverages what 100% of all distributors already do, find the right product for their clients, only in this case it’s the right brands to tell a richer story and enhance perceived value.
The Brand Media Business Model and Opportunity Unlike the incentive business, which requires distributors to invest time in understanding a new field and change their business models in terms of payment terms and billing, the new Brand Media is an extension of what distributors already do and is consistent with the business models with which they’re already comfortable. Distributors have an uncanny way of figuring out how to make money when their clients have a need, and there are multiple ways beyond the simple fact that while the margins are low, the average sale is much higher. In all areas of media, clients are accustomed to paying a commission or management fee for media selection and placement, and it is no different when they respect serious counsel on program design and the brand experience from a solution-provider.
Brand sales volume: As already noted, the volume for business gifts using programs is much higher and, in many cases, flows outside of the distributors obligations they sign on to if with a growing number of the distributor management network companies. According to the Advertising Specialty Institute, the average company spends about $80 per employee per year on holiday or other gifts. The average cost of a promotional product is about $1. A survey of about 4,000 companies by Chocolate, a gift card company, organizations spend between $65 and $125 per gift for customers and vendors; $125 for executives; $65 to $90 for middle management; $35 to $50 for junior management, and about $35 to $50 for employees.
Added-value: There is an opportunity for distributions and other solution-providers to make additional and higher margins for brand and reward selection; wholesaler sourcing; and oversight of customization, personalization and logistics, as well as analytics information from the participating vendors to get prescriptive analytics for the next program.
Cross-selling: Most gifting and reward programs are part of larger organizational efforts that provide opportunities for promotional products, production of marketing materials, and other support services offered by a growing number of distributors. Travel programs, for instance, generate many opportunities for room gifts, marketing and display materials.
Differentiation: Brand Media considerations require time and expertise with which AI and machine learning can provide useful analytics, but most companies aren’t even using the data they already have. The key to success is not only having data but creatively using it to achieve your client goals. The goal of the Brand Media Coalition is to rapidly expand a library of information about each brand to enable Brand Media Specialists to make more intelligent choices.
Prestige: Brand names add an element of sophistication to a promotional product distributor’s website. Being a Brand Media Specialist is a fresh new story for our times.
Trusted partners: The growing number of brands, gift cards and master fulfillment companies active in the coalition are committed to nurturing and protecting the Brand Media Specialists. They have extensive experience working with competitive vendors in the incentive and recognition market, and how to act ethically and transparently to support a vibrant industry of solution providers to bring their products to end-users. Some of them can even help finance large business opportunities outside the scope of the typical distributor’s resources. While the principles of Brand Media apply just as much to incentive, recognition and loyalty programs, the Brand Media Coalition is focusing particularly on the distributor market because of the large number of professionals already involved with selecting and sourcing products for all sorts of gifting and other related promotional activities and who have the unique aptitude for understanding brands as well.
2019 Voice of the Market Study, published by the Incentive Research Foundation.
Why Buy Through the Corporate Market?
Knowledge: In merchandise and gift cards, the corporate sales (or special markets departments at some companies), independent incentive representatives, master fulfillment companies understand how to find the brands and products, brand information and images needed; address the considerations related to inventory availability; manage customization, personalization, drop-shipping, security and fraud; support with state sales taxes and regulations (which often apply to contests/sweepstakes; the alcohol, firearms, tobacco, health care, financial services, cannabis industries, etc.) and brand compliance issues that can cause unexpected trouble and in some cases a social media and publication relations nightmare. This does not include the issues involved with international programs.
Service: Companies specializing in this business are built to support unique situations—in fact, that’s how they compete with the big online and big-box retailers: by having the expertise, resources, agility, etc. to personalize and customize a gift or award experience consistent with an organization’s objectives, branding and budget.
Pricing: While in some categories, especially consumer electronics, one can almost always find the price of a particular item or an equivalent on line at a lower price, the key is what is the price of that product specifically when it is given or redeemed, and will it be selected and customized and personalized in a way designed to distinguish it from compensation or an anonymous online retail experience like any other. The online and big box retailers are built for scale; the companies that survive in their world, such as Crutchfield’s and Best Buy in consumer electronics, do so by creating a level of personalized support and expertise outside the model of retailers buying in container-load volumes to turn as quickly as possible in order to buy more, and so on.
The Major Brand Media Players
Brands. In the past, almost all brands had active inhouse “special markets” departments to handle the corporate business, who sold through incentive representatives, and many still do have these departments and use incentive reps. After the Great Recession of 2008, many outsourced this business to companies now known as “master fulfillment companies;” that is, wholesalers or stocking distributors with the ability to maintain inventories of brands and drop- or bulk-ship items redeemed now mostly through online gift, incentive, recognition, loyalty, or fund-raising catalogs. If one seeks to do business with a specific brand, go to the Brand Media Guide or, if it is not yet part of the Coalition, to its consumer web site and check to see either in its navigation tabs and subnavigation or the web site’s footer if there is a link to Corporate Sales. Here’s an example of the link to be found for Canon special markets. Many brands, such as Bose, have outsourced their corporate sales to specific master fulfillment companies. This does not mean that one has to purchase the product from one specific fulfillment company, as others may stock the product as well and could have it available at competitive prices or with support services at the time needed that another fulfillment company cannot provide.
Retailers and gift cards. Much of the above applies to retail companies active in the market. For instance, 1-800Flowers.com has a link to corporate gift sales on the header of the site and it employs an inhouse corporate sales team of multiple people, some of them certified with the Certified Engagement Practitioner designation. Most retailers active in the market focus on selling their gift cards and belong to the Incentive Marketing Association.
Master fulfillment companies. These wholesalers specializing in the corporate market, of which there are no more than several dozen in the U.S., not only stock many of the leading brands and in some cases gift cards for appropriate corporate use, but to varying degrees offer:
• Complete program support, design, technology and implementation support in addition to rewards fulfillment. This is offered by only a few of these companies.
• Complete support with merchandise and/or gift card selection, fulfillment, customization and personalization; in some cases, event experience programs in which brands set up boutiques at events from which recipients select their rewards or gifts in custom-fitting purchasing experiences. Another attention-getting promotion is a warehouse run-through, which some of these companies can organize, in which participants are given a shopping cart and a set period of time to select their prizes.
• Complete online (and/or print) catalog creation and curation, procurement and logistics management.
• Sophisticated analytics that provide for more intelligent selection of brands, communications and other program elements based on actual behavioral data generated from the platform (infrequent).
Travel. Gone are the days when many planners of travel for motivational events, incentives, gifting or fundraising didn’t know the distinction between a travel agent and a motivational event planner, but the appreciation for the creative talents required to craft a masterful group or individual travel experience remains pitiably low, based on most surveys of end-users. Even though these trips, due to their cost, involve almost always an organization’s most important customers, companies frequently cut corners without seriously addressing the potential impact on engagement. It’s one thing to make valuable customers or employees wait on hold to get service for 10 minutes; it’s another to subject them to a terrible or inferior travel experience, let alone overlook this unique opportunity to forge a long-lasting emotional bond by making the experience unforgettable.
To find an expert: Almost every leading brand and venue active in the corporate market as a corporate meetings and incentive market. Just check their web sites for a link to group sales.
To find an expert: Click here for the master fulfillment companies in the Brand Media Coalition, the early pioneers and industry leaders bringing a powerful new tool to the market. To find a complete list of all active companies, click on Resources. Most belong to the Incentive Marketing Association and some to the Promotional Products Association or Advertising Specialty Institute. Many specialized in the travel market belong to the Society of Incentive Travel Executives, which has a learning and certification program for the business, but does not make its directory available for free to nonmembers.
The Art and Science of Engaging Rewards, published in 2017 by the Enterprise Engagement Alliance.
Incentive Programs The Incentive Marketing Association’s curriculum and certification program is the best education and only certification for program design. Click here for more information.
Recognition Programs The Recognition Professionals International provides the most comprehensive learning and certification program on recognition. Click here for more information.
Loyalty Programs The Loyalty Academy offers a comprehensive training program for the loyalty field.
BrandMediaCoalition.com, a growing alliance of leading brands, gift cards, and master fulfillment companies active in the market now publishes a Brand Media Guide. This is the only guide specifically designed to tell the stories of the leading brands active in the market to facilitate more strategic brand selection for gift and incentive programs.
Incentive Marketing Association, the industry’s only trade association for brands, master fulfillment companies, and gift cards, features a directory of all members.
Award Value Program Value Evidence Study, Schweyer, A.; Landry, A.T. PhD. Candidate, University of Quebec, Montreal, and Dr. Whillans, A., Assistant Professor, Harvard Business School. Study of impact of non-cash rewards.
“Establishing the Intangible Value of Reward Programs,” Schweyer, A.; Landry, A.T, PhD. Candidate, University of Quebec, Montreal, and Dr. Whillans, A. Assistant Professor, Harvard Business School. Study of impact of non-cash rewards.
“Incentive Marketing Association Landmark Study of Participant Award Experience Preferences,” The Incentive Research Foundation, 2015.
“2019 Voice of the Market Report on the Use of Non-Cash Rewards and Recognition, Incentive Research Foundation.” A detailed study of 45 program owners finding that almost none listen to industry resources for program design.
“Psychographic Determinants of Private-Label Adoption: A Feasibility Study in the Portuguese Yogurt Market,” Brochado, A. O., et al, Lisbon University Institute, 2008. A field study showing impact of retail brand names on purchase behavior.
“Impact of Perceived Value, Quality, and Loyalty on Purchase Decisions in the Accessories Department: Study on Saudi Females,” AL Huwaishel, Najoud S.; and Dr. AL-Meshal, Soad A., King Saudi University, Marketing Department, College of Business Administration. This study shows the same impact of brand equity on Saudi women as consumers in other countries, including the U.S.
“The Impact of Brand Awareness on Consumer Purchase Intention: The Mediating Effect of Perceived Quality and Brand Loyalty,” Dr. Hsin, Kuang Chi, et al. Nanhua University Taiwan, 2009. The same brand equity effect is perceived in Taiwan as well.
“The Effect of Store Name, Brand Name and Price Discounts on Consumers’ Evaluations and Purchase Intentions,” Grewal, Dhurv, et al, Professor of Marketing, 2008, University of Miami. These folks have done important research on the impact of brand store names.
“Jim Cramer Stresses the Power of Brand Names When it Comes to Investing.” CNBC segment from investment guru on value of brand name equity for investors.
“Understanding the Power of a Brand Name,” Nielsen Company, 2015. Report on how brand equity helps protect organizations when hit with bad news.
“Branding—the Ultimate Economic Moat,” Investopedia. Another article on how brand equity helps protect companies when bad news its.
“Brand Equity: Does the Brand Name and/or Price Affect Perceptions of Quality,” 2008, by Hilgenkamp, H, Ph.D. candidate Kansas State University, Kansas State University. In addition to its own insights, this graduate dissertation includes an excellent review of previous published research on the impact of brand equity on purchasing habits and perceived value.
“Why Do We Get So Emotional About Brands,” Harvard Business Review, 2015, by Andrew O’Connell. More insights on the impact of brand equity.
Incentives, Motivation, and Workplace Performance, Dr. Clarke, Richard, 2002, Department of Education, University of Southern California. A ground-breaking study on the motivational components of incentive programs and the Performance-Improvement-Based-Incentive model that touch on the importance of addressing all tactical levers of engagement in a systematic way.
Summary of the Brand Dimensions, Dr. Aaker, Jennifer, Professor of Marketing, Stanford University. Excellent overview of a useful Brand Personality description model.
“The Seven Deadly Sins of Storytelling,” Jennifer, Dr. Aaker, Professor of Marketing, Stanford University, Stanford University Insights, 2013. Useful article of the power of storytelling in business.
“News Analysis: ASI Highlights Growing Role of Brands in Promotional Products,” 2019, Rewards Recognition Network. A report on link to a video on the latest promotional products and gifting trends demonstrating the new interest in brand names.
Incentive Market Place Estimate, Incentive Federation, 2016. The most recent industry study of incentive, recognition, and business gift purchasing.