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Maximising Your Promotions Budget

When choosing how to allocate your promotional budget it is critical to understand the Cost-Per -Impression (CPI). CPI’s are used to measure the effetiveness of advertising, it calculates how much it costs to make an impression on a target client.

For example, if a $3,000 magazine advertisment gets viewed once by 100,000 potential clients the CPI is 3 cents. However if you gave out 1,500 branded bags at a total cost of $3,000 which has an average veiwing of 9.33 times per month for the year, than this works out to a CPI of 1.8 cents (also this does not include the number of views by potential cleints passing by).

A study conducted by the Advertising Specialty Institute and published in Promotion (March-April 09) revealed the following findings. Compare the numbers below and you will see the value promotional products can have in your campaign

Medium / CPI

Cost-Per-Impression of Promo Products

Caps $0.002, Bags $0.002, Writing Instruments $0.002, Shirts $0.005, Other Wearables $0.016, National Magazine $0.033, Newspaper Ad $0.019, Prime Time TV $0.019

This data illustrates that an ad in a national magazine can cost you over 15 times more and a newspaper ad almost 10 times more than adveritising on a pen, cap or bag for the same result. You can work out from this which is giving you more bang for your buck.

Another way to use the CPI measurment is when comparing costs of the same goods. A good exmaple here is with promotional pens, 2 pens can look, feel and write the same but one can be priced cheaper than the other. One way manufacturers keep their costs down is by putting less ink in the pen. It is not uncommon for some pens to have as little as 500m of ink compared to some more reputable brands that have over 1.9km of ink. By using the CPI you can work out that the 2nd pen will last almost 4 times longer, and usualy only costs about 15-20% more. In this case the cheaper pen is far more expensive per impression.

 

Matthew Bywater
Marketing Strategist

For more marketing insight from Matthew check out his blog – www.matthewbywater.com

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