You've worked too hard for those dollars sitting in your advertising budget to run a promotion and think it might have been a success. You need to know for sure that you made a sound investment in promotional products.



The first step in measuring effectiveness is deciding how and what to track through your use of promotional products. Campaign specific 800-numbers, email addresses, promo codes, webpages or QR codes are a few examples of simple tracking mechanisms. These methods work well in situations where quick responses or sales conversions are reasonably desired.

However, if the sales cycle is a bit longer, use your CRM to track those leads garnered through a particular promotion. It is important in these situations to not just giveaway your promotional products without gaining information from a prospect or moving them closer to sealing the deal.



The simplest way to measure the success of your promotional products is to calculate the ROI. To find this number, subtract the cost of the promotional products from the revenue generated and divide that number by the cost of the products.

So, for example, if you spent $1,000 on trade show giveaways that resulted in $6,000 in revenue, the calculations would look something like this:

The result is a 5 to 1 return on investment or for every $1 that you spent on promotional product you received $5 in profit. Well done.



What if your organization's has a longer sales cycle and the boss needs your report on the promotion's performance before sales can be realized? It takes a little more math, but you can calculate the ROI based on leads generated. First you will need to determine how much a lead is worth to you.

Start with your average conversion rate, let's say it's 5%. So to make one sale, you would need 20 leads. You average sale is $500. Divide that average sale by the number of leads you need to make that sale, so it looks like this:

One lead is worth $25. You spend $2000 on promotional products for a lead generating promotion. You gave away 500 products in exchange for contact information of interested prospects. That's 500 leads. Based on the value calculated above, 500 leads are worth $12,500. So, the ROI calculation looks like this:

So, you have potentially earned $5.25 per dollar spent with the leads that you generated with this promotion. Not bad.



Split testing involves comparing two iterations of your promotion to see which is more effective. It is a way to test on a small scale before launching a full scale promotion. In this case you could test one promotional product against another product, direct mail piece or other advertising method.

For the most accurate evaluation, keep as many factors of the promotion controlled as possible so that the only variables are the materials being tested. Track and compare ROI, responses or redemptions to see which one performed better. Once the evaluation is complete, adjust your strategy and roll out your promotion.

This blog is dedicated to showing you the effectiveness of promotional products. However, all of the statistics, surveys and case studies don't mean anything unless you see results for your organization. You now have the tools to evaluate the effectiveness of your promotions for yourself.


Courtesy of Newton MFG