Every year in this column I dedicate one month to the holidays. When I started my supplier business, my primary market was Christmas. It is still my primary market. I toured with suppliers doing Santa’s Workshop and presented seminar after seminar at shows and meetings. Enough of the past, let us look at today. The holiday market is more robust than ever. The sales curve continues an accelerated upward curve. So, what can I bring to the table you do not already know?
Let us review what you know:
You know that 80% of all businesses buy either gifts, calendars or greeting cards, and that it may be all three product categories.
You know larger businesses have many different departments or people buying for the holidays.
You know that the best way to get leads from every client is to ask: who buys your holidays gifts and cards, and can you give me a referral?
You may not know that over 1.5 billion holiday cards are sold annually.
You may know corporations HATE digital cards and block them.
Little has changed over the last 55 years since I entered this industry as a distributor. The holiday season is still the biggest volume producer for the traditional distributor. There are changes in the bestselling products. This year, tech gadgets will still reign supreme. In retail, items such as Apple Air Tags, digital picture frames and USB connector kits all represent products that did not exist 25 years ago, but a box of Maple Ridge Farms chocolates is as popular a gift as it was in 2000.
Gen Z and Millennials are the market focus. The preponderance of buyers are from Gen Z and they, and the Millennials, comprise the target market. Real Estate brokers are volume users of gifts, calendars and greeting cards. Their prime buyers are Gen Z and Millennials. Knowing allows a distributor to assemble a collection of gift ideas with appeal to this core group.
History has told us that, if a prospect does not buy holiday gifts, it is nearly impossible to convince them they should. There are a few exceptions. I am reminded of the distributor who turned gift selling into a multi part marketing program. We are all familiar with the coffee cup and the bag of coffee as products. This distributor sent the most unusual package of coffee accessories to reach the client by the holiday. Included was a note card with a hint that more was coming on New Year.
The greeting card industry has been declining, but some sub-segments, like holiday cards, have seen more stable sales due to the emotional value people place on physical cards. Retail reports indicate that millennials have been spending more on cards in recent years, outspending Baby Boomers on higher quality, often more expensive cards, which could be a factor in maintaining holiday card sales. This is a good indicator for your corporate sales.
Another trend working in your favor is the problem with gift cards. Not only are they impersonal and not memorable, but it is also estimated that billions of dollars in gift cards go unredeemed each year. In the U.S. alone, unredeemed gift card balances can range from $1 billion to $3 billion annually. This figure fluctuates due to factors like consumer behavior and the overall economy. Many people forget about their gift cards or fail to use them before they expire, contributing to this unclaimed money. Clients may just be tossing their gift budgets into the hands of the credit card companies for extra profits.
The trend, despite gas prices falling, is the incredible rise in shipping costs. A client who spends $10.00 on a gift will spend more to ship than to buy. The cost of shipping a 1-pound box via UPS to Zone 2, which covers local deliveries close to the sender's location, has gradually increased over the past five years, primarily due to annual rate hikes. For example, in 2019, shipping a 1-pound box via UPS Ground to Zone 2 would cost about $8 to $9, depending on whether residential or other surcharges were included. By 2023, this had increased to around $10 to $12.
If you measured your business volume by the month or the quarter, you should see the fourth quarter as your best quarter. The fourth quarter is the foundation for the following year and the revenue produced is all distributorships need for financial viability. The business is out there, it may be as simple as asking who buys?
Joel D. Schaffer, MAS is CEO and Founder of Soundline, LLC, the pioneering supplier to the promotional products industry of audio products. Joel has 48 years of promotional product industry experience and proudly heralds “I was a distributor.” He has been on the advisory panel of the business and marketing department of St. John’s University in New York and is a frequent speaker at Rutgers Graduate School of Business. He is an industry Advocate and has appeared before the American Bankers Association, American Marketing Association, National Premium Sales Executives, American Booksellers Association and several other major groups. He has been a management consultant to organizations such as The College Board and helped many suppliers enter this industry. He is a frequent contributor to PPB and Counselor magazines. He has facilitated over 200 classes sharing his industry knowledge nationwide. He is known for his cutting humor and enthusiasm in presenting provocative and motivating programs. He is the only person to have received both the Marvin Spike Industry Lifetime Achievement Award (2002) and PPAI’s Distinguished Service Award (2011). He is a past director of PPAI and has chaired several PPAI committees and task forces. He is a past Chair of the SAAGNY Foundation, Past President of SAAGNY and a SAAGNY Hall of Fame member. He was cited by ASI as one of the 50 most influential people in the industry.