It’s a healthy question and one that has strong opinions on both sides…
Does swag work?
Promotional products (AKA swag, tchotchkes, freebies, branded merchandise, you name it) have been around for some time. In fact, they date all the way back to George Washington’s campaign in 1789.
More recently, companies have started to integrate swag into their sales sequences, driving healthy growth for the entire industry. And by “healthy,” I mean $23.3B annually, nearly double what it was a decade ago.
So swag must work if that many people are buying in… right?
It’s a question met with pause since virtually every person has anecdotal experience of when it has gone wrong.
Who hasn’t left a convention with a t-shirt that didn’t fit, a pen that felt cheap, or a flash drive that didn’t work? These items end up in the trash, hardly a worthy investment of your firm’s marketing and sales budgets.
Fast Company even published an article encouraging brands to stop spending money on swag, citing broad environmental concerns. (a note: some of our industry has vehemently spoken out against this article).
I started working for a promotional products company several months ago with many of the same concerns and reservations that our account executives deal with daily:
- Are promotional products sensible investments for our brand?
- What merchandise do people want?
- Is this going to end up in the trash?
- And more broadly, does swag work?
Let’s dive into the psychology of swag, what the data says, and when you can expect it to work for sales.
The Psychology of Swag
We’re about to get to the data, trust me, but some context is helpful when considering the role of swag in the sales world.
Like any marketing or sales tool, promotional products are an investment. Whether you’re trying to attract new talent at a college career fair with a free notebook or get your foot in the door of an enticing prospect with a memorable gift, the best-case scenario is a give-and-take relationship that is established with a physical item.
This concept isn’t new. Our VP of Sales, Eric Hamlin, loves to cite Marcel Mauss in our sales meetings and training.
Mauss, a French sociologist, published a short book in 1925 titled The Gift. Essentially, he argues that an exchange of objects between groups builds relationships between humans.
When we give someone an item, there is an inherent expectation of reciprocity.
This sounds conniving, but this phenomenon is present in your everyday life. When your coworker brings coffee, you’re more likely to buy lunch. When you attend a wedding with an open bar, you likely come with a gift in hand. When you receive an unexpected birthday present, you (begrudgingly) feel obligated to return the favor.
Our urge to “square up” and “make it even” persists into the sales world as well.
The new SaaS
When describing the role of swag within sales, my marketing brain best describes it as SaaS. No, not software in this case, but rather swag as a step.
How much variety exists in your sequences between one prospect and another? Consider the decision-maker or buyer within a company — they get sales email… after sales email… after sales email. They want something new in their everyday process.
This monotony is where swag becomes increasingly important.
In a world of automated campaigns, the day starts differently when they find a package on their desk with some useful items from that company they’ve been getting emails from.
As a sales rep, you’re not bribing them to take action, but if you were in their shoes, wouldn’t you be more likely to return the call of a SDR who was thoughtful enough to send you a personalized item and information about their services?
The desire to reciprocate lives on.
What the Data Says About Swag
Back to the question at hand: Does swag work?
We talked about the anecdotal evidence of the bad experiences with promotional products. Conversely, we can cite tech giants increasing their spending on promotional products tenfold over the past several years.
Why the disparity?
I’m sure our industry would like us to highlight their report that swag:
- Has the highest recall rate of any advertising medium
- Is the most effective way to prompt action across all generations
- Gives 82% of people a more favorable impression of the brand that gave it to them
Great. What does that mean for you?
We wanted to test the effectiveness of swag as a sales tool for prospecting. So we need to ask two questions:
- Is it possible to generate more leads and close better deals just by placing a well-timed box of swag on the desk of a decision-maker?
- Does SaaS (swag as a step) work?
We partnered with Sales Hacker and Outreach.io for a webinar back in January to run the specific test just described. You can read more about the specific details and results of the experiment here. But here’s a summary of what we found.
In an A:B test, Outreach took two sets of 500 prospects. One group received swag and one group did not.
The sales sequences for these groups were identical — except for one sentence included in one of the group’s messaging, mentioning some swag the prospect should have received. Over the next several weeks, we tracked the prospects and waited.
Initial results were promising — a 26% increase in response rate. In the era of automation, where the majority of sequences go unanswered, increasing the reply rate itself is a win.
However, the results beyond that were surprising even to the seasoned industry professionals here. The group that received swag was three times more likely to book a meeting, and Outreach saw a 2.42x increase in opportunity value per prospect in the test group.
So, does swag work? The data points to yes, but let’s not stop there.
When to Use Swag
Swag worked for Outreach in a big way because all parties involved were strategic in the execution of the project. Like any sales tool, the likelihood of success increases when you’re able to tailor the experience to your prospect.
In the case of Outreach, their prospects were technology sales teams who were selling cutting-edge products while using antiquated sales tools.
This article is about the effectiveness of swag as a sales tool, rather than specific products, but here’s a quick list of what was included in the package:
- a foam stress toy in the shape of a flip phone
- a Qi wireless charger
- two corresponding notes encouraging prospects to “bring their sales platform into the future”
- everything was bundled together in a custom box with Outreach branding
You won’t find Outreach handing out flimsy pens at an expo. The products included in their sales sequences were thoughtful and relevant. They knew, for instance, that people are more likely to keep a wireless charger than a mousepad.
We like to create swag that is sticky — items that people will keep and use for years to come. And here’s why: Swag works when the utility of the product matches the interests of the recipient.
When launching a “sticky” swag campaign it’s important to think about two key components:
People will keep items that are useful, so it’s important to tailor the item to the lifestyle of the recipient. Road warrior CEOs may find more value in a travel accessory, while software engineers might appreciate a desktop product.
Both the item and branding should reinforce and support your company brand or the theme of your campaign. Approach swag as another marketing channel — a physical complement to your digital marketing strategy.
A Note on Attribution and ROI
Like most marketing and sales investments, the million-dollar question revolves around attribution. How did this prospect hear about us? Ultimately, what made our new client decide to sign the dotted line?
Promotional products present the same questions. Swag as a step, as the name implies, is a part of your total sales strategy. A blind investment in swag can only be proven as an effective strategy if it is tested.
Follow the Outreach.io model we described above. Divide your prospects into two groups. Keep as much of the campaign as possible the same for each group. Then deliver swag to just one of the groups.
For our trial, we used 1,000 prospects to ensure a statistically significant experiment.
When running swag as a step in a prospecting campaign, it’s worth thinking about your Average Customer Value (ACV) and the impact investing in swag will have on your Customer Acquisition Cost (CAC).
The Role of Swag for your Sales Team
As mentioned, I am new to the promotional products industry. When I joined Kotis Design earlier this year, I was skeptical about the effectiveness of swag as a whole. I remember career fairs and the pens, shirts, and notepads. (I don’t remember the companies, and most of those products are unfortunately in a landfill.)
Today, I think swag is an important sales tool when done right. It’s an opportunity to break through the noise. It’s a chance to start a conversation that otherwise would not have happened.
Some key takeaways:
- Swag as a step works well when done right. (Outreach.io saw three times more booked meetings and a huge increase in opportunity value.)
- The world has seen enough bad swag — make an investment that represents your brand and will be “sticky,” staying with your prospects for years.
- Experiment often and carefully. Track the results of your prospecting over the course of the entire sales sequence.
Marcell Mauss may have been onto something all the way back in 1925. People want to reciprocate. So send them a physical item that will last — and give them a reason to return your call.