When it comes to the largest promo markets, we knew there would be several anomalies in 2020 – some markets temporarily down, others temporarily up – that would right themselves in 2021. The surprise, it turns out, is which ones. As expected, education bounced back to claim the top spot and manufacturing reversed its major fall. Likewise, healthcare decreased (though only slightly) and government spending trailed off as well. Meanwhile, hospitality never made its long-anticipated comeback and actually decreased again in 2021, while finance continued a three-year plunge. Expect more continuity this year as we head toward a post-pandemic normal.
Biggest markets for promotional products (by percentage of distributor revenue)
4 Observations
1
The Hospitality Revival Never Materialized
In 2020 as we were eating another home-cooked meal and longingly looking at pictures of far-off destinations on our phones, restaurants and travel seemed a sure bet for a major comeback in 2021. It wasn’t the case, as the market share for hospitality slightly decreased. With leisure travel all the way back and restaurants and bars fully open now, it’s likely the rebound was just delayed by a year.
Hospitality (percentage of overall promo sales)
2
Manufacturing Back To Making Money
The market with the biggest drop-off from 2019 to ’20? Manufacturing, which was clearly impacted by shutdowns and reductions in spending. Now the good news – manufacturing had the biggest jump in 2021, making it the third leading promo market in three of the last four years. It’s a clear sign of the sturdiness of the sector, especially in overcoming the supply chain and inventory issues that plagued industries across the board.
Manufacturing (percentage of overall promo sales)
3
Order is Restored at the Top
Education had been the number-one market for six years in a row, but the surge in PPE spending as well as the major shift to virtual schooling elevated healthcare to the top spot in 2020. While healthcare only dropped slightly in 2021 (down 1.4 percentage points) and education only went up slightly (.7 percentage points), that was enough to put education back in the top spot. As for the government …
2019
- 1. Education
- 2. Healthcare
- 3. Manufacturing
2020
- 1. Healthcare
- 2. Education
- 3. Government
2021
- 1. Education
- 2. Healthcare
- 3. Manufacturing
4
The Government ATM Shuts Down
It was open season in 2020 as government entities looked to anybody and everybody to deliver desperately needed PPE. The largest distributors in the industry – with the sourcing might to secure massive quantities of overseas goods – delivered, and it showed in the data, as government sales accounted for over 10% of their 2020 figures. As the medical equipment market stabilized and the demand for PPE dried up, so too did government sales for this demographic in 2021. Instead, these distributors focused more on healthcare, manufacturing and finance.
Government sales for XL distributors ($5+ million in sales revenue)