Incentive - August 2009 - (Page 33)

AWARDS Electronics: Recharging the Market By William Ng onsumer electronics have always been among the bestselling merchandise awards, so when the economy plunged last fall, corporate incentive demand for personal and home electronic equipment expectedly took some lumps as companies canceled or delayed their motivation programs and made workforce reductions. “The first five months [of 2009] weren’t fun for anybody; financial and automotive client business was terrible,” says Vince McDonald, vice president of sales and marketing for Maryland Heights, MO-based fulfillment house Incentive Concepts LLC. Ed Handel, corporate sales advisor for Crutchfield Corp., in Charlottesville, VA, adds, “We haven’t necessarily blown the doors off, but we’ll take [break-even] six months into the year.” Electronics manufacturers, suppliers, and incentive houses are looking at the remainder of this year with cautious optimism. Some in the premium and incentive channels say corporate buyers that abruptly diminished or eliminated their merchandise reward programs are returning, as companies have “corrected” to economic conditions and look to motivate the employees they have retained. And there are encouraging signs on which to hang their hopes, as consumers appear to be more confident that they will purchase new gear in the coming months, according to statistics from the Consumer Electronics Association (CEA). Salespeople, who spend a lot of time in planes and trains, continue to covet Bose headphones, like the noise-canceling QuietComfort 3 C The CEACNET Index of Consumer Technology Expectations for June (the most recent month available) was 84.4, or 3.3 points higher than in May, but also back to the level of August 2008, which was before the economy began its freefall. Since the March low of 67.2, the index, based on buying and spending expectations, has continually climbed even as general consumer sentiment remained flat and the jobs outlook declined. One reason? Ben Arnold, senior research analyst at the CEA, says this year’s $400 individual tax credit from the government’s stimulus plan is driving sentiment among consumers that at least one electronics purchase can be made before the year is out. The other? “The hallmark of the electronics industry is innovation, fueled by new products that enhance our lives,” says Arnold. “That’s why there’s always space in people’s wallets for electronics.” Not Out of the Woods Yet Still, other industry insiders remain wary of the second half of 2009. “This year’s not going to turn around much,” noted one manufacturer’s rep. “I’m an optimist but a realist.” And a sales manager at a major multinational electronics maker gave pause, noting, “We’re forecasting just a slight pickup for the second half,” and adding, “average selling prices are going down.” Indeed, manufacturers’ prices have dropped, says McDonald, as electronics makers have been trying to clear out stagnant inven- incentivemag.com | August 2009 | Incentive | 33 http://www.incentivemag.com

Table of Contents for the Digital Edition of Incentive - August 2009

Incentive - August 2009
Contents
Editor’s Note: Confession of a Cash Clod
Headlines
Cover Story: Ameriplan, a Multilevel Marketing Firm, Stands By Incentive Travel
Gifting for Good
Research: Gift Card IQ
Strategies: Proving Ourselves
Primer: Diversity Best Practices
Travel News: Where to Go and How to Get There
Potentials: Here and Now
Electronics: Recharging the Market with What Excites
Debit & Stored-Value Cards: The Universal Workhorse

Incentive - August 2009