In co-op advertising, manufacturers and retailers work together to manage the marketing campaigns for select products. As a result, co-op advertising allows you to expand your reach and represent new products. In addition, it helps manufacturers reach consumers without taking on the total burden alone.
In this guide, we explain more about co-op advertising, how to create successful co-op marketing campaigns, and how to use them to benefit your business.
What Is Co-Op Advertising?
Co-op advertising is a shared marketing practice where manufacturers give retailers or customer-facing distributors marketing materials and funds to promote products. A manufacturer might also provide retailers with marketing assets, such as images and videos, and a budget for some or all of the advertising. Alternatively, sometimes a shopping center or commercial real estate group will offer co-op advertising funding for shops on the property.
Some co-op advertising agreements are no-frills, with minimal funding, while other contracts may include the manufacturer providing full ads. This funding can be used to advertise the products on television programs, radio stations, or print media. Thus, it benefits the source of the funds because more goods and services are bought, and it helps the retailer.
If You Have Co-Op Dollars to Spend, Here's What to Do
While co-op dollars can be a helpful supplement to your marketing objectives, you must plan how to use those dollars. Not only will the distributor want to know the funding was used, creating a plan can maximize your return on investment.
1. Create a Marketing Campaign Publicizing Your Business and the Manufacturer
Your marketing plan should showcase both your own business and the manufacturer. It should also clearly follow any requirements in the agreement. Stepping outside of those guidelines may put the funding — and the relationship — at risk.
Once you have a plan, submit it as a proposal. Proposals may need to be pre-approved, or suggestions to optimize the project will be given. This step makes sure all parties are happy with the planned campaigns. It's also an excellent opportunity to confirm that you will be fairly reimbursed.
2. Start the Campaign
At this stage, you can follow the approved plan step by step, making it much easier to manage other campaigns. Due to the additional funding, you can also advertise more aggressively or to a broader audience.
Remember, co-op agreements are supposed to benefit both you and the manufacturer financially. Ultimately, your store should be seeing more profits, not just more revenue, due to the co-op agreement.
3. Invoice the Manufacturer for Money Spent
With the advertising plan pre-approved, invoicing your partner should be simple. Include itemized expenses and show a report about the outcome of the campaign. Of course, your specific agreement may consist of different incentives based on those results. Even if that's not part of the terms, highlighting the positives makes you a good candidate for repeat co-op advertising arrangements.
Here's How to Get the Most Out of Co-Op Advertising
Co-op advertising is a great tool for any business, but you have to stay on top of things to get the best possible results.
Here are some tips to make the entire process more accessible and to set the foundation for a profitable relationship:
- Keep Records: Organize receipts and invoices for any expenses you incurred through the marketing campaign to get a fair reimbursement. You'll also be able to do your own ROI analysis at the end of the campaign.
- Make Sure the Campaign Features Both Parties: Your co-op advertisements should highlight you and the manufacturer.
- Take the Reins: If you want a co-op advertising arrangement with an organization, but they don't have an existing program, don't let that stop you. Instead, bring up the idea and pitch what the arrangement could look like for you both.
Ultimately, co-op advertising should be a mutually beneficial agreement that satisfies all involved.
Meredith Massachusetts Can Help Your Manage Co-Op Advertising
If you have a small marketing budget or want to grow beyond what your current circumstances allow for, co-op advertising is an excellent approach. You and your manufacturers can both grow by increasing exposure to your joint target markets. If you're considering your first co-op advertising opportunity, Meredith Massachusetts is here to help.