I was sitting at the local chamber breakfast with a couple hundred business owners and executives. Since I was the new guy, I got the honor to introduce myself and give my 30-second elevator speech.
Here’s what I essentially said: “My name is Eddie Hill. My wife and I are the new owners of Award Masters Inc., which has been proudly serving our community since 1981.” The emcee said, “Oh, you guys sell trophies.” I said, “Yes, we do! Trophies are seven percent of our business.” Then I sat down.
This obviously peaked everyone’s curiosity because they were wondering what the other 93 percent was. I got inundated with questions after the meeting. Of course we sell trophies, but the bread and butter of our gross income is from corporate awards and gifts.
Defining and refining corporate awards
Let me define what a corporate award is. A corporate award is simply a personalized item that recognizes someone in a business setting. Corporate awards are most commonly used to recognize years of service, employee of the month, sales awards, customer service awards, customer appreciation awards, safety awards, retirement awards, among others.
Before I tell you what to sell and how to sell it, I want to persuade you on why you should sell corporate awards…
Maximum gross profit: For my shop, the average order size and net profit of corporate awards is 200-400 percent higher than that of sports awards. Margins matter and especially in today’s business environment we need to maximize the profit on each sale.
In my shop, we place the items with the highest margins in the prime display locations. There are some pieces of crystal that have a very high perceived value that allow us to mark it up more than the average.
And vice versa, if we have a multifaceted piece that is hard to make and expensive to buy wholesale, I place that item on the bottom shelf or get rid of it completely. When we get a new piece of crystal or acrylic, I always ask my customer service reps how much we should sell it for. They have no idea what my cost is; their opinion is based on perceived value.
I realize most business owners mark up items based on a multiple of the wholesale cost. That could be your starting point, but you should take advantage of the opportunity to get more margin. I also hold more inventory of the higher margin items. I tell my reps which ones we have in stock, and which ones we have to special order. Inevitably they will sell more items that we have in stock, which is a win all around.
Lower labor cost: The labor to produce corporate awards is usually much lower than sports awards. Once the corporation picks their awards, they usually stick with the same one for years, making it easy to change out the name and date and produce.
Templates and jigs allow us to speed up production, minimize waste, and lower labor costs. Most crystal and glass awards now come in their own box already glued, which makes it easy to decorate, clean and put back in the box.
Monthly recurring revenue: Most corporate awards are given out throughout the year, not just during busy season. Many programs like sales awards and employee of the month awards are given every single month. Even years of service awards are given out in the month of their anniversary.
My favorite programs are what I call white label fulfillment. For instance, we have realtors that every time they sell a house, they email us a photo of the new owners in front of their new house. We engrave a photo frame that says Congratulations on Your New Home with their name and date. We put it in a box with the realtor’s letterhead and ship it blind to their customer. Some realtors sell 5-10 houses a month, which adds up quickly.
My friend owns a mortgage company and sends a monogramed cutting board to every new client. He does 30-50 mortgages a month. I love those types of orders! They come in like clockwork.
What you should sell
I alluded to the different corporate programs earlier. Selling a nice piece of crystal one time is wonderful but selling that same piece every month to that business is fantastic! You are not trying to sell just a one-time award; you are selling an ongoing recognition program.
Programs are long term and recur consistently, usually monthly, but maybe quarterly or at least yearly. A lot of our programs started from a human resource officer just wanting one award. After a brief discussion about the different types of recognition programs, they now buy awards consistently. It’s our job to sell them on the benefits of a consistent recognition program.
According to a study by Society for Human Resource Management, over 91 percent of HR professionals believe that recognition and rewards make employees more likely to stay longer with that company. I personally think that’s a no-duh statement, but there’s the study to back it up. Of course, recognition increases longevity; it also increase engagement — the two things most corporations are concerned with. We have the power to help them.
The personalized items in these programs can be one of the corporate award staples like crystal, glass, acrylic awards, and plaques. But the longevity of the recognition program can be dramatically lengthened with the uniqueness of the award.
For instance, if you created a full color custom acrylic that’s cut out in the shape of their logo, the odds of them sticking with the program for a long time is much higher because it’s their own unique award.
Also, these days with many workers working from home, they don’t have a public place to display their awards. In this case, it might be better to sell them functional awards. Functional awards are simply items they can actually use in everyday life. It could be a nice wine box set, a personalized clock, a personalized watch, or something as simple as a high-end engraved pen, personalized tumbler, or a personalized notebook.
We have several large customers that allow the employee to pick their personalized item from a list we gave them. The employees love getting to choose their personalized item.
How to sell corporate awards
It’s our job as a recognition expert to help our customers with recognition programs. Many companies are looking for ideas to increase employee engagement and employee retention.
It’s my contention that there isn’t a better way to do that than employee recognition programs, whether it’s performance-based awards, service awards, or even team awards.
Here’s a quick rundown on how to run an employee recognition program. Simply use the 4 Rs. Regard, Remark, Reward, Repeat.
Regard: to make note of (something) through the use of one’s eyes. As management
training master Ken Blanchard says, “Catch people doing something right”. For the program to have the greatest effect on behavior, you must define exactly what behavior you are looking to reward.
If you see someone doing something extraordinary or doing above and beyond activities, make a note about the specific details, because you will use them for your speech when you give out the award. That leads me to the next R…
Remark: a briefly expressed opinion. When you give the award to the recipient, be very detailed in explaining the exact behaviors they did to receive the award. The specifics will give extra accolades to the recipient, and a path for those who will by vying for the award next month.
Reward: After your remarks, present the award. The perceived value of the recognition is in direct proportion to the fanfare of giving it. Let me say that another way: The bigger deal you make in giving recognition, which includes the award itself, the bigger the value that is placed upon the recognition. That’s why they roll out the red carpet for the Oscars and that’s also why the Oscar award is 13.5″ tall and weighs a hefty eight and a half pounds, because it’s triple-plated with copper, nickel and then 24-karat gold. The closer you get to those specs, the better your rewards program will be.
At the very minimum, all recognition should be done in public, especially in front of their peers. If you want to step it up, have a meal. And if you really want to amplify the recognition, have an offsite event with a band, emcee and maybe even a magician! (Red carpet is optional.)
Repeat: Do it again. For any program to work you must be consistent. As Bruce Lee once said, “Long-term consistency trumps short-term intensity.” Keep the fire going, be proactive in asking who the
next month’s recipient is. Make it easy to do repeat business with you.
So, now you know why, what and how to sell corporate awards. The only thing left to do is take action. Set a goal to contact ten new businesses per month, start with the largest in your community on down. Introduce yourself as a recognition master (some of us actually hold that title). Let them know that you can help dramatically increase employee retention and engagement. You will soon be able to say that trophies are seven percent of your business.
