Rosalind Robe Boukis has operated her California-based distributorship, Advertising Magic (asi/111425), for more than 35 years, providing promotional products to a variety of grocery store chains, small businesses and other verticals.

She’s had a relatively robust 2025, she says – but the year is ending with a whimper, not the customary Q4 holiday gifting bang.

“It’s the quietest November I have ever experienced,” she says.

The suspected cause? Retailers pulling back on end-of-year gifting as they worry about the optics of splurging on holiday promo amid sweeping worker layoffs, a tough labor market and continued economic uncertainty. It’s a move that could have started as early as last year, with retail dropping to just 4% of the promo industry’s overall sales – its lowest level since 2018.

But for many distributors, uncertain economic conditions have meant a shift, not a slowdown, in promo spending from their retail clients – a shift that means retailers are more eager than ever to maximize every dollar to do more with less.

“We find that the marketing dollars haven’t disappeared,” says Brittany Frase, chief revenue officer at MadeToOrder (asi/259540). “They’re just being scrutinized a lot more closely. So our customers are spending, they’re just spending a bit more cleverly.”

Shifts in Labor

This year has been characterized by a constantly shifting economic climate that both retail consumers and employers aren’t quite sure how to react to, especially when it comes to the labor market.

Despite overall low economic confidence – both from the general population and the promo industry – people are still spending. Just one example: the National Retail Federation (NRF) estimates that Americans are set to spend a record $1.2 trillion for the holidays this year, bolstered by a Black Friday/Cyber Weekend where more than 200 million Americans went shopping.

At the same time, retail hiring is at its lowest level since 2009 despite a larger workforce, according to the Bureau of Labor Statistics. Job opening levels are stable, but significantly lower than their peak in the past few years, with the NRF estimating that retailers will hire between 265,000-365,000 additional seasonal workers ahead of the holidays this year – impressive on its own, but also down anywhere from 20% to 40% compared to the nearly 450,000 extra hires in 2024.

Coupled with record layoff numbers across verticals – including corporate roles at major retailers like Target and Amazon – promo pros might notice that teams they’re accustomed to working with are notably smaller now than they used to be.

“A client of mine that used to have 10 people on their team might only have four people on their team now,” says Michael Scott Cohen, a member of the Counselor Power 50 and the co-founder of Harper + Scott (asi/220052), now a BDA Company. “That means that for 2026, they’re way behind on their calendar of where they should be.”

That often means more is expected from the distributor, Cohen says – but it’s also an opportunity to make a big impact on a client by being proactive with campaign suggestions, rather than waiting for a specific request.

That’s been the case at MadeToOrder, says Frase.

“Our customers are spending – they’re just spending a bit more cleverly.”Brittany Frase, MadeToOrder (asi/259540)

“We’re getting more intentional about asking for the marketing calendar and asking them what their goals are for the year,” Frase says. “That way, we can make sure that we’re tapping into those goals prior to them coming to us. Less reactivity, more proactivity.”

On the worker side, a tighter labor market also means that the people who land new retail positions are more likely to hold onto them than they have been in the past few years – a far cry from “The Great Resignation” of the pandemic when employees were leaving workplaces at elevated rates.

At Counselor Top 40 distributor American Solutions for Business (asi/120075), national director of vertical markets Christine Fischer says the lack of turnover has also led to a bit more stability in uniform programs, particularly those for new employees.

“What would end up happening is that the employee would be gone before their uniform got there,” Fischer says. “That’s not been a problem as much this year, and I think it’s because the economy is so crazy – whenever somebody gets a job, they’re not as likely to want to leave right away.”

Rewarding ROI

That’s not to say, even in a tough market, that companies don’t have to provide some appreciation or incentive to stay. Companies who are hiring are inundated with hundreds or thousands of (often AI-generated) resumes, making it challenging to find a genuine good fit and placing a bit more value on the best employees they do have.

“The majority have picked up pace to investing more of their marketing funds into further recognition within their staff, trying to keep the ones they have,” says 2025 ASI Media Salesperson of the Year finalist Dan Cull of Royal Recognition (asi/313998), of the variety of convenience store chains he works with.

What they want, he adds, is clear metrics for tracking how those initiatives impact turnover – all decisions backed by data analytics and intentionality. Royal Recognition recently built an analytics calculator for its customers, Cull says, to help more quickly balance client budgets, expectations and goals for a given recognition project while still maintaining a data-driven approach.

$1.2 trillion
Estimated 2025 holiday season consumer spending, the first time that predictions have ever surpassed $1 trillion.(National Retail Federation)

Frase notes that same desire for concrete ROI growing over the past few years when it comes to customer-facing promo, whether that’s increased sales or customer loyalty.

Providing case studies has become incredibly important for proving what works. If you can give clients a “why?”, the dollars will be there. It’s all about using the budget that’s available to make a tangible impact, says Cohen. He’s seen, for example, a push toward gifts with purchase to help increase sales once potential consumers are in the door.

“How can they stretch other places and get people to spend more?” Cohen says. “Maybe give them something in exchange for spending more than you think they’re going to spend. That’s the way to drive the receipt up.”

It often costs far less to keep an existing customer with a well-targeted promotion, rather than pull in a new one, says Fischer. Among companies looking to get more bang for their buck, she’s noted a growing trend of connecting merch solutions to customer loyalty programs.

“This is not moving the needle for them revenue-wise. This is getting people to go in and buy bowls or food, and that’s really where they make their money.”

Michael Scott Cohen, Harper + Scott (asi/220052), on merch driving other important metrics, not necessarily revenue

That could mean having merch as a top-tier option for spending loyalty points or dropping exclusive promo for members, she suggests – both options with a clear ROI based on initial interest from customers and potential social media engagement.

This works, too, because loyalty program participants also are, largely, already dialed into a company, making them likely to actually use or wear any merch they receive, and, thus, easy targets for further extending a brand’s reach beyond the initial promotion. 

“Not only did they solidify my loyalty,” Fischer says, “but they’re also now making me a walking billboard for the company.”

The Merch Moment

In addition to nailing down loyalty, merch can also be a vessel for brands to stay relevant in the age of constant trend cycles and pushing for the “next big thing.”

In Cohen’s view, a successful merch campaign has to have a strong purpose behind it – a “why” – but for many of the brands Harper + Scott works with, their “why” is staying relevant.

Cohen’s frequent mantra is that “merch is media,” and it’s true. The feeling of exclusivity that comes with a limited edition drop gets a brand’s name on the minds of consumers in the same way that a viral social media post can. That, in turn, ultimately serves to make a company feel more relevant and, hopefully, drive traffic to stores.

At a time when Americans are eating out less while pinching pennies, that was crucial for a brand like quick service restaurant CAVA, which recently launched its first-ever merch collection powered by Harper + Scott. The Q4 timing was extremely intentional – and not just for getting in front of consumers embracing quirky holiday gifts, says Cohen. 

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A post shared by CAVA (@cava)

“This is not moving the needle for them revenue-wise,” Cohen says. “This is getting people to go in and buy bowls or food, and that’s really where they make their money.”

Black Friday provided a perfect opportunity for retailers to use promo to capitalize on projected record holiday season spending while creating that moment – or miss the mark.

Target, for example, has been bashed on social media since Black Friday for their anticlimactic promised “swag bags,” which featured a few underwhelming trinkets like fun-sized candy and sample sized toiletries for the first 100 patrons in line to shop – many of whom had lined up for hours for the chance to win one of a few top goodies, only to be sorely disappointed by their consolation prizes.

But that “golden ticket” style of promotion has the potential be a massive success. It’s a trend MadeToOrder’s Frase has seen more of this year, especially when it comes to combining a print activation with promo items or sponsored goods.

The distributor recently fulfilled a similar style order for a major department store, where the first several dozen people in on Black Friday were gifted a set of items with the potential to win the “golden ticket” prize – and the eventual winner’s social media post garnered massive engagement for the brand.

“It’s not even about capturing that Black Friday sale,” Frase says. “It’s making sure customers are thinking about them not on Black Friday when their stuff isn’t on sale, because that’s better margins for them.”