Why Use Promotional Product Advertising for your Business?

Higher ROI

Return on investment (ROI) is a way to measure the effectiveness of different methods of advertising. It's an analysis of the profits made from an action compared to how much of a financial investment is needed to carry out that action. Learning about the ROI of different forms of advertising can help businesses to make good choices when deciding where to use their marketing funds. Advertising can be expensive, and there's nothing worse than spending a lot of money on a campaign that doesn't bring in any new business.

Promotional products offer a better ROI than almost any other type of marketing out there, including television ads. One way to calculate ROI is through the cost per impression, or the average amount of money that is spent for a campaign compared to the number of times someone sees the advertisement. For example, the average cost per impression for a promotional baseball cap is only 0.002 cents. That's one fifth of a cent for each impression. The figure is about the same for promotional calendars, bags, and three-dollar pens. Shirts have an average cost per impression of 0.005, or half a cent.

smile Ads on television often have a much higher cost per impression. Prime time TV spots, for example, are 0.019 cents per impression. That's more than nine times the cost of using an alternative like quality promotional pens. Cable TV ads average at about 0.007 cents per impression, which is still a significant increase over promotional products. Another drawback of using TV ads is that they usually require a significantly larger minimum investment to get started than promotional products do. Television advertising will generally cost more overall. That's bad news for a business that is just starting out or doesn't have a huge marketing budget.

Other popular types of media advertising are also much more expensive than promotional products. A half-page black-and-white ad in a newspaper costs about 0.019 cents per impression. Ads in national magazines are an average of 0.033 cents per impression. For a spot radio ad, the cost is 0.005 cents.

Promotional products have the potential to save companies money, because they're relatively inexpensive. At the same time, they have been proven to bring in customers and increase profits. This combination creates a high ROI. Research has also shown that many people have more positive views of companies after they send them promotional products. The majority of people, 62 percent on average, also report that they have done business with someone after receiving a promotional item from them. The statistics used in this article were published in “Advertising Specialties Impressions Study: A cost analysis of promotional products versus other advertising media,” which was released at the ASI Power Summit on November 10, 2008.

Increase Brand Awareness & Intent to Purchase

Promotional products are ideal for creating awareness among a selected audience. Southern Methodist University conducted a study to measure attendee awareness of product demonstrations in three university communities. They found that selective distribution of promotional products outpulled school newspaper advertising by a ratio of two-to-one.

Promotional products, used as dimensionals in direct mail solicitations, can boost response rates by up to 75 percent, according to a study by Baylor University.

Customers reorder faster and more often when promotional products are used instead of coupons. In a study by Southern Methodist University, customers receiving promotional products reordered up to 18 percent sooner than those who received coupons and up to 13 percent sooner than those who received no promotion.

Promotional products effectively reinforce employee sales contests, too. A Baylor University study of month-long sales contests in retail establishments indicates that contests reinforced by periodic distribution of promotional products were cost-effective and outperformed non-stimulated contests by up to 50 percent.

fact According to a 2005 study conducted by Georgia Southern University, recipients of promotional products have a significantly more positive opinion of a business through: more positive overall image, more positive perception of the business, higher likelihood of recommending the business as well as a higher likelihood of patronizing the business.

fact A 2004 study of business travelers at DFW Airport revealed that 71 percent of business people reported having received a promotional product in the last 12 months. Of that group, 33.7 percent had the item on their person and 76.1 percent could recall the advertiser's name! 52 percent of that group did business with the advertiser after receiving the promotional product and 52.1 percent reported their impression of the advertiser was more favorable after receiving the item.

fact Recipients of promotional products remember the advertiser's name. A study by Schreiber & Associates (Peoria, IL) showed that 39 percent of the people receiving a promotional product could recall the name of the advertiser as long as six months after they received it.

fact Numerous case studies document the effectiveness of promotional products. One fast-food restaurant's investment of $181 in promotional products resulted in more than $1200 increase in food sales. One study found that promotional products increase the response to direct mail up to 75%.