When rapper and actor Method Man stepped onto the Toronto International Film Festival (TIFF) red carpet at the premiere of his 2014 comedy The Cobbler, he was wearing something that made fans do a double take.
Atop his head was a “Toronto” emblazoned tuque made by local apparel retailer Tuck Shop Trading Co. It had landed in the hands of Method Man when owner Lyndsay Borschke offered it at a TIFF gifting lounge.
“It was a huge moment,” Ms. Borschke said, adding that model Cara Delevingne and actor Lena Dunham also sported her products around the same time. “All of a sudden, you are fielding calls from people wanting this product. … It definitely drives the needle and you see sales and you get interest from media.”
Feats such as the one Ms. Borschke pulled off with Method Man are not easy for small businesses to replicate at TIFF gifting lounges and suites, assembled by public-relations firms at hotels and rented spaces near the September festival so high-profile guests can connect with brands and leave with a bag of swag sometimes valued at thousands of dollars.
Whether participating in a gifting lounge is worth it for a small business comes down to luck, experts say, because most lack the billion-dollar budgets or name recognition of the big brands (think Swarovski, Dior and Casper) against which they jockey for attention.
“It is a bit of a crapshoot because you are sending [products] and you have no idea whether someone big is going to take one and actually wear it and be photographed in it,” said Ms. Borschke, who one year sent at least 150 tuques, retailing for about $38 each, to a lounge, and between 50 and 75 of her $378 vests another year. “There are so many steps that have to happen before you see any results from it.”
Dina Vieira, the founder of PR agency dvCommunications Inc., has represented brands at TIFF, Grammy and Oscar lounges for years. Brands, she said, shell out anywhere from a few thousand dollars to hundreds of thousands of dollars for the experience.
She’s noticed there’s a lot small businesses are up against when they use lounges.
Some celebrities, for example, refuse to be photographed with products knowing they can negotiate payment for such an endorsement.
“[Singer] Katy Perry came through a gift lounge in L.A. and her handlers made their rounds advising there would be no talking to or taking pictures of or with her,” recalled Ms. Vieira, in an e-mail to The Globe and Mail.
Other stars get too busy at premieres, news conferences and parties to spare time for a lounge. They often send assistants to pick up swag, nixing the chance to get them to pose or fall in love with a product.
Ms. Vieria also noticed troubles when the U.S. Internal Revenue Service cracked down on celebrities not reporting gifts as income in recent years.
“This can create implications for brands giving away thousands of dollars worth of merchandise or experiences and the celebrity may opt to donate the gift instead or they accept a gift certificate to redeem at a later date, to defer acceptance of the full value,” she explained.
Despite the challenges, Natasha Koifman, the founder of NKPR Inc. and its IT Lounge, can easily list 13 years of success stories, including when actor Mila Kunis spotted Ms. Koifman’s ring-to-wrist bracelet from local jeweller !Xam Diamonds.
“I gave it to her right off of my wrist. Hello magazine covered it. We sold out of those bracelets,” Ms. Koifman said. “So the lounge really does work.”
Ms. Koifman was among the first public-relations agencies to bring the suite concept to TIFF in 2006, when apparel brand Timberland persuaded her to start one. The IT Lounge, which Property Brothers Drew and Jonathan Scott have played host to and counts Dev Patel, Natalie Portman and Elizabeth Olsen as past guests, will be held for four days at the Purman Building this year and feature booths from Hounds Vodka, OGX Beauty, Sleep Envie and others.
“For small businesses, it’s super beneficial, because it would take them a year to get the kind of press coverage that they get in the four days,” she said, adding that her lounge is attended on its media day alone by more than 120 people.
“Not every celebrity is going to connect with every product or every brand, but if they get to discover something new that they’re really excited about, isn’t that what it’s all about?”
Esther Garnick, the founder of communications firm EGPR, has championed small businesses including Knixwear, Me.n.u Food Truck and Misfitstudio at past suites.
She tells clients, especially small businesses, to focus on forging meaningful connections and to not expect immediate results. Sometimes, she said, it’s just good to put a company on a reporter’s radar for when they’re working on a story weeks or months later and need a business to talk to.
Her Essentials Lounge – scheduled for Sept. 4 at the Richmond event space and to include promotions from Aveda, Carolina Herrera New York and Moxie’s Bar and Grill – caters to media instead of stars because of how fickle it can be to attract celebrities and ensure they’ll use a product.
“Brands are paying top dollar to dole out products to people who probably don’t need them and probably won’t even use them. It’s a big risk. Sometimes it pays off, and sometimes it doesn’t,” she said.
“If [model] Gigi Hadid wears something it might completely change the course of that company and may completely help them skyrocket, but it’s not always a sure bet.”