Promotional Products Return on Investment (ROI)
Promotional items
A study by the Advertising Specialty Institute found that “business promotional items are one of the most cost-effective advertising mediums for businesses.” The recall rate for promotional goods is around 89%, meaning that roughly 89% of customers can recall the advertiser on a promotional product they received within the past two years. A further 80% of people can also recall the messaging of the brand if they receive a promotional product from them. A physical item can also be much more effective than other types of campaigns. Promotional mugs and tumblers rank as more effective than radio/TV advertising. Studies report 57% of people can recall a brand’s advertising on a mug vs only 28% against recalling the advertiser on TV.
So why aren’t more businesses leveraging this growth opportunity?
One of the main reasons businesses may not be investing in corporate gifting or custom products is a perceived upfront cost. Certainly, depending on the products chosen, the upfront costs can look higher than expected. It’s important to consider more than just the raw cost when looking for promotional items.
Calculating ROI on promotional items
While not as easy to measure as a digital marketing campaign, this post challenges you to consider the ROI on promotional goods. The ROI is based on impressions – the number of people who are likely to see the branded product. When comparing investing into a marketing plan here’s a way to calculate the return on promo items.
No. of Items x Cost Per Item = Total Spend
Impressions per Product x No. of Items = Total Impressions
Total Spend / Total Impressions = Cost per Impression
Let’s break it down in a simple example using custom coffee mugs:
72 mugs x $10ea = $720
50 impressions ea x 72 = 3,600 views
$720 / 3,600 = $0.20 per impression
So, 72 mugs infrequently used only 50 times a year will get an estimated 3,600 impressions at an average cost of just $0.20 per impression. To put this in perspective the average CPC for Facebook advertising across all industries is roughly $2.00 per click.
With customers who consume coffee every day you could be looking at 72 x 365 or over 26,000 impressions a year. That takes the cost per view down to just $0.02 an impression. Those numbers don’t include others who might see the branding as well, which only drives down the impression costs even further.
Approx number of impressions
Clothing generates the most overall impressions over the expected lifetime of a product. The only exception being polo shirts, which can give the impression of a work uniform, making the wearers seem like employees and not casual users of the product. On average any product is expected to generate multiple hundreds if not thousands of impressions over its lifetime.
Know your target audience
Pick promotional products that your target audience will find useful or enjoy. Narrow in on products that are relevant to your business and will see use. Choosing well focused and quality products helps them stay around.
Approximately 87% of people keep promotional products for longer than a year while 4 out of 10 keep them for more than 5 years. That means people will continue to see your brand over and over, helping give you even more return on investment.
While at first glance promotional product expenses might seem more costly than alternative marketing options the actual cost per impression of promotional goods are extremely cheap. They provide long last lasting and consistent brand reminders to current and potential customers over a long lifespan.
Let Cascade Print Media help you grow your brand by offering solutions and options to stay in your customers’ minds while meeting your budgeting needs.
Sources: PPAI, ASI
