Thursday, July 28, 2011

The Economics of School Bus Advertising

As the economic pressures on school districts intensify, more and more are considering turning to school bus advertising as a way of ameliorating their budget woes. The impulse is understandable, but it would be great if more school boards did their homework before deciding to make compulsory exposure to school bus ads a part of children’s school day. In addition to being ethically unsound, school bus ads just don’t pay.

Consider the case of Sumner County, Tennessee: the Board of Education has just filed a lawsuit against 1st Class Marketing for failing to properly pay the school district for ads sold on the district’s buses. The board’s contract with the marketing firm called for 60% of ad sales to go to the district. But to date, they’ve only received $5,422 of more than $47,000 in ad sales, so they are suing for the remaining $22,875 they claim they are owed.

So in a best-case scenario, the Sumner County board will recover that money and hopefully its court costs. That means the district would generate $28,297 in revenue from school bus advertising for school year 2010-11.

Now I know $28K is nothing to sneeze at, but let’s put that in perspective. The district’s annual budget is $180 million a year. In the best case, the school bus ads will account for about .015 percent of the district’s annual budget. Or to put it another way: ads will generate about $1.03 for each of the 27,369 students in the district. Sumner County spent $6,577 per student last school year.

And that’s if everything turns out right. If the board is unable to recoup the money it’s owed, or if it accrues significant legal fees, or if it has to devote more staff time to the dispute, the ads could actually cost the district money.

The numbers for Sumner County are consistent with what I’ve seen other places. If districts sell ad space on their buses, it’s fair to say they can expect to generate between $.50 and $1.50 per student each year.

I’m often asked, “Isn’t it better to allow school bus advertising than to lay off dozens of teachers?” It’s a compelling and heartbreaking hypothetical, but one that has little to do with the real choices school districts are facing. A better question for educators would be: “Are you really willing to sell out your students for a dollar a kid?”

1 comment:

  1. Excellent post... Its very useful for school traveller...