COST AND VALUE: What do they mean for your promotional products?
What is the difference? What do they actually mean? And how do they impact your promotional products? Carefully consider cost and value need when you’re planning your promotional product budget. They are a valuable tool in a larger marketing strategy, after all. Read on to find out how cost and value work together – and what they mean for your products.
Cost
Cost is the dollar amount you spend on your branded merchandise. It’s the number that you may feel is the most important. However, when it comes to investing in your business is the out-of-pocket amount the only one you consider? Of course not!
Value
The value is what customers perceive your products are worth. It is not a dollar figure. A product’s worth is based on usefulness, quality and longevity. Value is individually perceived and not easy for companies to track. When it comes to your brand, however, it is possibly the most important factor, as we’ll discuss below.
How do cost and value work together?
Effective promotional products must maintain a careful balance between cost and value. Your brand invests in a product, hoping that your potential customers will see its value, keep it and eventually give you their business. Because value is unique to an individual, it is not a direct reflection of a product’s cost.
For example, you may spend $20 per product, but it may have no value to the recipient. In turn, they give you little to no return on investment (ROI). Likewise, a product costing you 50 cents may be of great use to the recipient and return upwards of 1000x its cost in future business.
The ideal ratio is low cost and high value. But today’s consumers aren’t so easily bought.
We’ve all become so used to being sold to that we’ve learned to tune most advertising out. If something looks like it’s trying to sell to us, we treat with suspicion and its value decreases.
A promotional product’s ‘give-away’ nature
Branded merchandise sometimes suffers from its ‘give-away’ nature. Because it costs the recipient nothing, a promotional product often has a low perceived value. We know when what we’ve been given has been mass-produced. That feeling takes away the gift’s uniqueness and any sentiment it may be trying to convey. This is why it is key to know your target market and have a focused, strategic aim in your branded merchandise marketing.
To counter this, choose promotional products that are not like anything your customers have seen before. They should be unique, useful and feel like they cost something substantial. This increases their perceived value and will compel the receiver to keep it. The longer your products are used, the more impressions and advertising your brand receives.
Cost and value per impression
An impression is the moment your audience sees your brand/contact details/logo. Promotional products are the most cost effective way to increase brand impressions. The more impressions, the higher chance of someone doing business with you.
When your promotional product is in use often, even every day, the impression count sky-rockets. How many times will you client pick up that bag? How many times will others see it on their way to the shop?
A promotional product’s relatively small cost is well worth it for the number of times customers and prospects see and engage with your brand. You can read about apparel and pens impressions and ROI in our other articles.
A promotional product with a low cost to you but a high value to your customer adds great value to your business as well. Quality, well-placed merchandise has the potential to provide huge ROI. That return comes in the form of revenue and brand loyalty, making the initial product cost well worth it. You just have to get the cost and value ratio right.
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