I’m writing this story wearing a t-shirt branded with the name of a tech startup that no longer exists.
Hired Inc. was founded in 2012 and acquired by the Adecco Group in 2020. In the intervening years Hired helped tech companies recruit employees, burned through ~$130m in funding, and gave away copious amounts of swag. I also have Hired dress socks and a Hired winter hat, given to me by a friend who worked there.
Corporate artifacts like these are hardly unusual. One Hustle reader has Blockbuster video tupperware. Another received an AOL varsity letterman’s jacket that celebrated a mid-90s milestone of 3m users.
Companies come and go, but swag is forever.
The Hustle
In 2023, the corporate swag industry in the US and Canada — known more formally as the promotional products industry — grew for the third consecutive year to a record of $26.1B, according to the Advertising Specialty Institute (ASI), a promo industry trade group. That means swag revenues are roughly equal to those of the US book publishing industry and not far off the global music industry.
Swag has been growing at a moderate clip in an era of white collar austerity. Companies have slowed down hiring and initiated layoffs while nixing free lunches. They’ve also reduced certain types of ad spending.
Corporate swag, however, endures. It’s cheap and typically leads to a solid return on investment, according to Tim Andrews, CEO of ASI. It’s “a low cost way to make sure your brand is in front of a customer or prospect every day for months and years,” he says. At many companies, it’s one of the last marketing expenses to go.
But if swag does hit a downturn, look out.
“Usually, we’re a harbinger of the economy in general,” says Daniel Oas, CEO of High Caliber Line, a promotional products supplier.
A sampling of swag, clockwise from top left: Airport-branded flannel, Aprio tape measure/level/sticky note dispenser, Christian Dior tarot card deck, Opposing Counsel Tears mug, fertility company’s sperm-shaped stress ball, Title Source Fan. (Hustle readers)
Promotional swag has been around since at least the early 1900s. I’d hoped this meant people walked around wearing stovepipe hats emblazoned with “Standard Oil” or “US Steel” at the turn of the 20th century, but more legitimate examples from this time include Coca-Cola calendars and thermometers.
The industry really took off in the 1970s when companies began handing out free t-shirts, Andrews says. Apparel is still the largest sector of swag, but promotional products have evolved over the years.
In the ‘90s and early 2000s, there used to be “a lot of what we call CPS – cheap plastic shit,” Oas says. Tchotchkes like light-up pens, carabiner clips, and mini calculators were popular.
Companies now want premium swag less likely to end up in a landfill after a week: backpacks, sweatshirts, any type of portable drinking vessel. Drinkware swag revenues totaled ~$2.6B in 2022 for nearly 10% of all swag sales, according to ASI, which deemed Stanley Quenchers the promotional product of the year in 2023.
Oas says the Stanley cups were his No. 1 selling product in the last 18 months by revenue. As a supplier, High Caliber Line sells products that are largely manufactured in China or India to distributors who resell them to corporate clients.
Like almost every industry, private equity has encroached into swag over the last few years, buying up suppliers and distributors. At least on the supplier side, Oas says the private equity groups have struggled to understand the business, with many experiencing declining or flat sales.
More swag. Clockwise from top left: “Bourne Ultimatum” tire gauge, Prudential light-up tambourine, Sangoma Christmas ornament, Air2Web red stapler (inspired by “Office Space” stapler), Xerox and United Way pizza cutters. (Hustle readers)
But the industry itself has been consistent, growing at a steady pace since the early 2000s. In an email interview, Alok Bhat, market economist and research lead at Promotional Products Association International (PPAI), another industry trade group, described swag as “relatively resilient due to its cost-effectiveness and the unique value it provides in maintaining brand engagement during challenging times.”
In late 2022, for instance, ad spending fell by ~6% as brands feared an impending recession. But promotional product spending was up~12%.
“When people are looking at their marketing dollars and saying, ‘Where can I get the very best return on my investment,’ the purchase of promotional products is really number one — better than billboards, better than radio, better than TV and can [be] really very targeted,” says Andrews.
Some companies actually pivot to swag in a tough economy. Bhat recently spoke to a promotional products distributor who said many industries, including beermakers, doubled down on swag to keep their companies visible when consumers tighten their budgets.
Still, swag is not recession proof. It dipped during the pandemic and fell hard in 2009 at the height of the Great Recession. (President Barack Obama eliminated federal government swag spending in 2011.) Both Bhat and Andrews call the promotional products industry a “leading indicator” for specific industries and even the economy at large.
“When we observe increased spending on promotional products by sectors that heavily depend on consumer sentiment — like food and beverage, hospitality, or retail — it can suggest that those industries are gearing up to maintain or regain market share in challenging times,” Bhat says. “Conversely, if spending in these areas decreases, it may signal caution or preparation for economic headwinds.”
The Hustle
Oas recalls talking to friends in other industries who hadn’t yet felt economic pain around the time Lehman Brothers crashed in 2008. His business was down ~30%.
“And when it got better,” Oas says, “we came out first.” (Swag grew 11% in early 2010, ~3x the pace of the US ad sector and ~4x as much as the US economy as a whole.)
So as people wonder if the US is headed for a soft landing or troubled economic times in the coming months, how’s swag doing?
The industry was up ~1.75% YoY in July, according to PPAI, its growth below the inflation rate. Oas is up for the year about 10% but had been tracking 20% growth until distributors recently started opting to purchase cheaper items.
“It just kind of slowed down a little bit,” he says.
In other words, the corporate swag index suggests the economy is humming along but could use some heating up.
The swag, however, is always coming in hot, as evidenced by this BlueChew erection tablets flashlight:
(Hustle reader Shree)
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