Q: I am working on a project that requires determining the value of various advertising vehicles for potential sponsors. I am having trouble figuring out a value for placing a logo on a T-shirt or an outdoor banner. It must have something to do with the number of views, but I don't know how to calculate a dollar value for each view. Any help would be appreciated.
A: Research done on the effectiveness of promotional items and "cost per impression" suggest that the ROI is very high. This does not mean that the revenue generated from having logos on baseball caps, for example is a lot, but rather, that the cost per impression is very low. Thus, the revenue generated from the promotion has a very low cost to generate. Here are two links with information on the cost per impression on various clothing items, and ROI of promotional items. Return on Investment Return on investment (ROI) is a phrase used to describe the measurement of the effectiveness of advertising, and is an analysis of the profits compared to the cost of a financial investment. When companies learn about the ROI of different forms of advertising, it can help them to make good choices on allocating marketing funds. Advertising is expensive, and it is detrimental to a business when money is spent on a campaign that does not bring in any new business. The good news about promotional products is that it offers a better ROI than almost any other type of marketing, including television ads. One way to calculate ROI is through the cost-per-impression, which refers to the typical amount of money that is spent for a campaign compared to the number of times a customer sees the advertisement. The average cost-per-impression for promotional items is often very, very low. On average, the costs-per-impression of popular promotional items are as follows*: Promotional baseball cap: $0.002 Personalized calendar: $0.002 Logo bags: $0.002 $3 custom pens: $0.002 Shirts: $0.005 In comparison to other forms of advertising, promotional products have the lowest cost-per-impression. Television ads generally have a much higher cost-per-impression, ranging from $0.007 to $0.019. Newspaper ads (black and white) and ads in national magazines are an average of $0.033 per impression. Promotional products are highly cost effective because the same people see them repeatedly and new people are continuously coming into contact with the products. They are, for the most part, inexpensive and have proven time and again to bring in customers and increase profits for businesses. According to the “Advertising Specialties Impressions Study: A Cost Analysis of Promotional Products Versus Other Advertising Media,” released in November 2008, 62 percent of people, on average, report that they have done business with a company after receiving a promotional product from them.