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Direct effects of promotional products on financial KPI’s

Technology & Data

Direct effects of promotional products on financial KPI’s

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Promotional products were once considered a cheap and cheerful way to burn some surplus budget at the end of financial year – fuzzy feel-good gimmicks, justified by intangible objectives like ‘brand awareness’ and ‘goodwill’. Few marketers saw them as anything more than an add-on to the ‘real’ marketing strategy, and even their proponents would duck for cover at the mere mention of ROI. But times have changed. Promotional products are now cementing their place as solid performers in the overall marketing mix. And, as the recent APPA Awards demonstrated, the proponents are now proudly proclaiming their successes with direct reference to the bottom line.

“There is no question attitudes have changed and people are now investing their resources in this medium,” says Nathan Schipper, director of Tangibility. “In 2006, below the line advertising – which includes promotional products – exceeded above the line expenditure for the first time ever.”

Ross Stevenson, general manager of promotional marketing at Corporate Express, attributes the shift to the availability of better quality promotional products. “In the last decade, the promotional marketing industry in Australia has matured considerably. Clients now look to promotional merchandise as a key component in achieving their marketing objectives.”

Bringing home the bacon
At the heart of most marketing strategies is an imperative to increase sales. This objective was clearly demonstrated by this year’s Gold Award winner in the APPA Awards’ Consumer Programs category.

Corporate Express Promotional Marketing SA knew that its client, Mitsubishi Motors Australia, needed to inject some excitement into its dealerships’ corporate merchandise sales. So, with just 24 hours to pull something together, the promotional products company came up with a strategy to capitalise on the imminent guest appearance of six-time winner of the Paris-Dakar Rally, Stephane Peterhansel, at the 2006 Sydney Motor Show.

The 11th hour plan involved air-freighting 100 Ralliart Racing Caps and setting up an appointment to meet Stephane, who fortunately agreed to sign all the caps before leaving for Europe the next morning. Rather than just merchandise the caps as they were, Corporate Express saw a further opportunity to increase the caps’ value. The company designed a limited number of showcases and mounted the caps in individually-numbered special edition wall displays. The promotion increased the client’s merchandise sales by 30 percent within the first three months.

Taking out the Silver Award in the same category, Wompro designed and developed a range of premium gifts to be used as a gift with purchase program for Hennessey Cognac. Aimed at a target market of male consumers with high disposable incomes, the gift packs included silver-plated cufflinks, a playing card set encased in a faux-leather gold-embossed hinged case, and a dice cup set. As a result of the initiative, the client achieved record sell-through rates for its Father’s Day and Christmas promotions.

In a co-branded promotional product initiative, which won the Gold Award for the Limited Budget (Under $5) category last year, Men’s Health magazine partnered with Pure Blonde beer to increase sales of both the magazine and the beer. The companies worked closely with Sands Promotions to create a retail-driven gift with purchase program that tied in with Men’s Health’s 100th issue. Sands Promotions designed and manufactured the keyring bottle-opener, which was attached to the front cover of the magazine. A backing card encouraged readers to ‘Get a six-pack on us’, inviting them to present their card at any BWS outlet, buy a six-pack of Pure Blonde and get another six-pack for free. The campaign generated a response rate of more than 12 percent.

Fishing for information

Promotional products can also be very effective in initiating customer contact and collecting data. This can either be done by rewarding the customer with a gift for responding or by providing them with a hook to pique their curiosity and prompt them to make contact.

Taking on the latter approach, The Lifting Company (TLC) built an air of intrigue among its customers through a series of three interactive puzzles. Brandconnect WA designed the puzzles to engage TLC’s customers but also convey a message that would prompt them to respond. The puzzles bore the tagline ‘There is always a solution’. The enclosed card thanked the recipient, promoted the business and invited them to contact TLC should they require the puzzle’s solution. A month later, the program had contributed to a sizeable increase in extra business and TLC continues to receive requests from clients for the other puzzles to complete the set. The campaign attracted a Silver Award in the Business to Business Programs category in this year’s APPA Awards.

In a similar vein, promotional products company Tangibility recently completed a targeted marketing campaign that drew consumers in by presenting them with an incomplete dartboard set. The dartboard was delivered minus the darts, and arrived with an attached card that simply stated ‘marketing solutions that hit the target’. The card encouraged the customer to call to arrange a meeting and receive the missing darts. An impressive 82 percent of recipients called to set up a meeting.

Driving tradeshow traffic

Promotional products are often given out at tradeshows, but an opportunity that is commonly overlooked is using them to actually bring people to the tradeshow stand. “Done well, promotional products can not only drive traffic to a tradeshow stand, but reinforce the marketing message long after the show is over,” says Jason Bradbury, managing director, Wompro.

They key is to develop an idea that is relevant to your audience and creates a point of difference. “A competition offering prize packs of merchandise is a great way to get people to visit your stand,” suggests Corporate Express’ Ross Stevenson. “Prior to the show, send an invitation out to your target audience with a coupon that has to be redeemed at the stand, which goes in the draw to win a prize.”

Infocus Mechandising put a novel spin on this approach for its client PMI, in a campaign that attracted the 2006 APPA Silver Award for Tradeshow and Conference Programs. Infocus created individual ‘parking meters’ with alarms that would go off when the next draw was about to happen, giving visitors a reason to revisit the stand. The parking meters came with metal discs that were used as individual prize draw tickets. The metal discs were able to be used for future events and tradeshows, to encourage clients to keep them indefinitely. The alarms went off every 30 minutes during the conference, generating a buzz among attendees and brand awareness for PMI. More than 80 percent of exhibition attendees visited the stand to enter the disks into the competition. 

Enticing event-goers

With so many events, conferences and corporate functions vying for a piece of people’s limited time, a creative invitation can make all the difference. “A promotional item can be used as a ‘teaser’ to ensure people attend an event or as an incentive to register early,” says Clive McCorkell, director of Arid Zone. “For instance, there could be a series of tropical items to entice people to attend a convention or conference at an exotic overseas destination.”

The critical thing is to make an impact. “Perception is reality and first impressions count – so make the invitation unique,” advises Tangibility’s Nathan Schipper. “Why send out an invitation to a dinner or function on paper when you can do it on a customised serviette or wine glass?”

Or a maraca, perhaps? One of Strive Corporate’s clients wanted to invite its own clients to a Christmas party that had a Calypso theme, so it printed the invite on maracas. “The maraca invitation showed a real point of difference and engaged customers prior to the event. The event filled quickly, the clients were excited and as a result they spent more money than ever before on the silent auction!” quips Strive’s general manager Natasha Mahar.

As a company that prides itself in creative promotional products, Wompro was determined to create something to get tongues wagging with its own invitations to this years Spring Racing Carnival. “We created a series of three very unique invitations that told a story,” explains Bradbury. “The first piece was housed in a personalised golden box featuring a Melbourne Cup lapel pin. Inside was fake turf, a themed invitation, and a bottle of Moet, plus a horse and branded pen to convey the essence of the Spring Carnival.” In part two, invitees received a red box containing a feng shui coin, fortune cookies, a money clip complete with a mystery bet, a faux $100 note and a betting calculator.

“The grand finale was hand delivered in a custom silver box containing a pair of binoculars to view the days racing, and of course other VIPs,” adds Bradbury. All the company’s invitations were apparently accepted, despite the fact that many of the clients had been invited to other marquees.

Educating the masses

Whether it be a message directed towards a select audience or the community at large, promotional products can be a far-reaching and cost-effective way to spread the word. “Promotional products have the ability to communicate educational messages effectively due to their tangibility and relevance. For example, what better way to encourage consumers to limit their showers to three minutes than giving a shower radio with a built-in three-minute timer?” poses Schipper.

The National Heart Foundation of New Zealand took its message of health education skipping across primary and intermediate schools throughout New Zealand with a digital skipping rope. Developed exclusively for the Heart Foundation by High Impact Marketing, the skipping rope counts distance, calories and skips. Children would receive the skipping rope as a thank you for taking part in the Jump Rope for Heart fundraising program. Not only did the campaign raise donations per school by 54 percent, it also educated kids about the importance of exercise, while raising awareness of the National Heart Foundation.

All for a good cause

One of the biggest growth areas for promotional products in recent years has been in fundraising. One only has to consider the ubiquity of the red poppy on Anzac Day, the pink Breast Cancer Foundation ribbon or the now iconic SIDS and Kids red nose, to realise how powerful promotional products can be in raising funds, and indeed awareness, for charitable causes. The benefit of having a promotional product that can be worn is that it reinforces the loyalty of existing supporters at the same time as promoting the cause to others.

One of the major considerations to take into account in embarking on a fundraising effort with promotional products is price. “Essential to maximising the profit raised is keeping the cost as low as possible,” says Schipper. “To this end, plan well in advance. This allows for the product to be manufactured abroad, keeping costs low and maximising profit.”

Other critical factors are visual appeal and relevance. Corporate Express’ Ross Stevenson advises choosing a range of merchandise that appeals to a wide age group to broaden the pool of potential community support.

Buyer beware

As all of these examples demonstrate, a well-executed promotional product campaign can be an invaluable component of the marketer’s arsenal. But it’s not as simple as just sourcing the cheapest products on a last-minute whim. A successful promotional product campaign generally takes a fair bit of planning, foresight and, most importantly, a reputable supplier.

While it’s important to keep a lid on costs, rock bottom cost can often equate to rock bottom quality. “If a cheap product is used it may end up in the bin before it has the chance to transfer the message,” says Bruce Jones, account executive, Sands Promotions.

If you use a poor quality product, you also run the risk of this reflecting unfavourably on your brand. Such was the case at a safety training seminar run by a state government department, where defective thermal mugs were distributed to attendees. “Unfortunately the coffee mug was inferior in quality and the handle broke, scalding recipients,” says Schipper. “The department issued a recall immediately but the safety message was lost in the embarrassment of an inferior product.”

Forward planning is essential, particularly if the budget is tight. “Probably one of the main reasons a promotional product program doesn’t work is due to lack of time given to the distributor to come up with a suitable solution,” says Jones. “This may lead to the use of whatever is available rather than an item that is specifically suited to achieving the right response.”

The final caveat, and perhaps the most obvious, is to closely consider the product’s relevance and suitability to the target audience. The product should complement the company’s brand positioning. “For example, a company promoting or supporting environmental issues would look to use promotional merchandise made from recycled materials to support their campaign message, rather than a product that has no environmental value,” says Stevenson. “Similarly, a promotion for raising the awareness and issues of drink driving probably isn’t best supported by a branded stubby holder!”

“If the message being communicated has no relation to the item being given, the impact will be minimal,” warns Schipper. “Choose promotional products that have a strong correlation with your company’s products, services or target market.”

And lastly, adds Schipper, be creative. “A stubby holder with a logo is a stubby holder with a logo – it’s no different to the 100 other stubby holders already sitting in the recipient’s bar. Think outside the square – and be prepared to push the boundaries.”

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