Employee engagement. It’s all the rage in the field of employee relations – but what is it and what opportunity does it hold for the promotional product market?
Employee engagement is the emotional commitment the employee has to the organization and its objectives. This means the employee really cares about their work and the company, they are committed and “engaged”. They don’t work just for the money, or just for the next promotion, but work on behalf of the organization’s objectives. They judge their own success by the company’s success. Numerous studies have shown that companies with engaged employees see improved productivity and profitability.
Recognition and reward is a key part of building engagement. Employees need to feel valued and recognized for their contributions. However, there is a difference between short-term motivation and recognition. Gift cards, team luncheons, cash and travel motivate for short term goals. Recognition items such as awards, trophies and plaques are typically displayed on desks, walls, shelves & mantels, therefore having fewer impressions per month than other promotional products (223 impressions/month) BUT these products are kept for a very long time AND generate the most favorable impression from recipients. The best recognition programs include a combination of both.
Awards & Recognition is the 5th largest product category in the industry, growing 26% in 2013 and contributing $963million to overall industry sales. A recognition program can include years of service awards, quarterly or yearly sales achievements, and team project completions, for example. Think about your opportunity for multiple orders and increased PROFIT!
For example, the average order size for a low-cost pen is 1500 pcs and the average sale is $385 net. The average order size for a standard mug is 152 pcs and the average sale is $222 net. The average order size for awards is 12 pcs and the average sale is $863 net. See the difference?
Most companies have existing incentive, appreciation or recognition programs already in place and the average repeat/life cycle of a program is 5 years. If you’re not selling awards to your existing customers, who is? Let’s do the math…
Average sales value per order: $863
Average potential distributor profit per order: $345
Average potential number of orders per month: 3
Potential Profit per year: $12,420
Potential Profit per repeat order/life cycle of 5 years: $62,100
If you can secure a recognition program it is a highly repeatable business, and with the increased importance on employee engagement, it’s a market that will continue to grow.
Margit Fawbush, Communications Manager,
bicgraphic.com. For general Award Recognition Gift inquiries, please contact our customer support team at 1-877-norwood.