Budget vs. Per Unit Costs in Determining Promotional Marketing Spend


Finding the right promotional product that enforces a brand, while delivering the right message under budgetary restrictions are some of the biggest challenges that a promotional products sales rep faces with their client.  Too often in this economy, salespeople inadvertently  compromise brand integrity due to a client’s budgetary constraints, by delivering sub-standard product that meets those budgetary constraints.  Too often, the buyer is convinced since they’re working on a shoestring budget, they are limited in the products in which they can choose.  Sometimes, this might be the case, but in most circumstances it is not.  Even with a sizable budget, it’s imperative that salespeople don’t get too focused on per unit costs of the products that they are selling, but rather a client’s overall marketing spend.  

Instead of thinking about per unit costs which limits the customer’s choices, learn how to get an overall understanding of the client’s total marketing spend for the event, trade show, promotion, product launch or campaign.  Then, begin to  understand where the products you present fit into that bigger picture.  I like to think about all of this in terms of a pie.  I’ll fraction my client’s trade show budget pie off into five pieces, after we’ve discussed and learned some of her projected trade show expenditures.  Her first “spend”, or piece of the pie, goes to her exhibitor company who makes her booth and graphics; the next piece to her transportation company; the next piece to her fulfillment house; the next piece for exhibition costs; and then finally, the last piece of the pie went to her marketing budget for uniforms and trade show giveaways.  

In discussing my client’s exhibition costs, or the first piece of the pie; we learned that her exhibitor company outsourced table cloths, banners, graphics and the like, but specialized in the  booth hardware.  By asking questions, we learned that we could save our client money through our own promotional resources, trimming her booth design costs.  Through this process, we also learned that our client’s transportation costs included a handling fee from her fulfillment house for holding  the goods as we shipped them, and that she was also charged by the day.  In addition, we knew she would be charged both shipping and handling fees for transporting the goods to the show.  From that discussion, we worked to save our client money by shipping our products as close to the event date as possible and in some cases we shipped product directly to the trade show, cutting out fulfillment costs altogether.  Due to this big picture planning, we were able to trim from the client’s overall trade show budget and shift that spend to promotions that our buyer could use to generate booth traffic, develop leads and promote sales.  In my client’s eyes, I shifted from being a product salesperson to my client’s on-call consultant.

Now that the budget was finally determined; I started to break down my client’s needs for their uniforms and promotional giveaways for all attendees.   We determined that the uniforms had to be  top-notch and SCREAM quality.  Next, we realized that we had different levels of needs for the attendees of the trade show.  Those attendees were placed into into A, B, and C categories.  All attendees who stopped by my client’s booth received an “C” level gift.  (We needed lots of under $5.00 items that our client could hand out at will to anyone that stopped by.)  Mid-level managers in attendance received a “B” gift with a higher spend and lower distribution, and executives were given a “A” level gift with an even higher budget and much lower distribution.  We had four pieces of the pie this time, and determined our giveaways by focusing on the client’s total budget and not the client’s initial per unit cost directives. Inevitably, the client spent more on promotional product used or distributed at the trade show to promote company awareness and goodwill.

Tonia Allen Gould
Tagsource (Founder)
BrandHuddle (Founder)

Author: Tonia Allen Gould

Tonia Allen Gould is the CEO of Tagsource, a 25-year-old Consumer Promotions and Marketing Agency, she's founder of the Finding Corte Magore Project, and children's book author of Samuel T. Moore of Corte Magore. Here, on this blog, she writes about whatever compels her at the moment. In her book, she explores the concepts of perseverance, hard work, bullying, and finding a place to call home for young readers. The impetus of the Finding Corte Magore project stems from Tonia's background - growing-up below the poverty line, in rural Indiana. A product of Indiana's foster care system, she is the first to say that books, a solid education and teachers, taught her there was a life for herself, tangible and within her reach, she just had to reach out and grab it. After publishing her first book, she decided she wanted to find an island and make it real, by naming it after the fictional place in her book, “Corte Magore,” and utilize it for social and environmental good. Today, the 29-acre island of Corte Magore at Hog Cay, Nicaragua- through a joint partnership with Ambassador Francisco Campbell, the Nicaraguan Ambassador to the U.S.-will be utilized by the Finding Corte Magore Project to work to keep Nicaraguan children in school. The Finding Corte Magore Project works virtually to connect a global community of students and institutions with the plight of educationally and economically repressed Nicaragua. The project involves showcasing and managing one of the country's own beautiful islands in its educational and environmental initiatives. The goal of The Finding Corte Magore Project is to create social awareness coupled with building a sustainable, positive and long-term educational impact on the country's children who have an on-average fifth grade dropout rate. In addition, Tonia is a promotional products industry veteran. She is the founder and CEO of 25-year old Tagsource, LLC (AKA TAG! The Creative Source). She currently serves on the BOD for the Specialty Advertising Association of California (SAAC), is an "Industry Voice", a recipient of a PPAI Golden Pyramid, and has been named on ASI’s Hot List. She is the recipient of Supplier of the Year award through the Women’s Business Enterprise Council West, as nominated by Fortune 500 companies.

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