Need advice on spending big budget on marketing

I run an airport shuttle transfer company and today I received a call from an airline company opening new flights to my city with interesting offer. They would place an ad on boarding passes (both electronic and printed) for flights to my city. They guarantee 10,000 tickets per month with my ad on it for price 0.33 EUR (0.45 USD) for one ad. They require 3 month no cancellation contract so I have to pay 9,900 EUR for a campaign I have no clue how profitable it will be. I like the idea because ad would target exactly our customers but:
- it is much more than I have spent on any ad ever
- for every 17 passengers at least 1 have to buy a transfer (6% conversion rate), if less than 17 I am in profit, if more than 17 I am in loss
-this could bring my company to different level and also I could loose quite a significant piece of my budget

Any advice from experienced marketers would be much appreciated.

Thanks in advance

 

45 cents per ad? Oh, hell no.

 

I am going to have to agree with you here. That sounds like a bit of a crap shoot. Largely because the visibility is on the wrong segment.

If I am going to travel somewhere I am going to know how I am getting from the airport long before a boarding pass.

Nigel

 

Definitely a no no... You can spend far less. waaaaaaaaay less. consider other options.

 

Hmm, I have no experience with airlines, but if it's a new city for them, it seems reasonable that they would want their passengers to have a way of getting from the airport to the city (which is what your company does, right?).

If you think the risk is too high, make a counter offer - tell them that you can pay them say, $0.25 per ad - if there's no other shuttle companies, they'll accept a lower offer since there's no one else they can work with, and because ticket ads are basically free for them, any profit is better than nothing.

Or ask them if you could pay per customer instead (for example, $10 for each person who actually buys a transfer).

Negotiate, their offers aren't written in stone (just like their ticket prices)!

 

Lol.

But seriously, wouldn't it be better to just advertise through the internet or even solo ads?

 

I'd actually do this over the internet, just costs too much.

 

Like the above posters have stated, it would be better to pay for the ad's online as that is far too much. As targeted as the audience is, I would have to agree with Nigel that if I am going somewhere I have my ride sorted in advance.