Co-op Advertising Techniques to Benefit Brand and Retailers

The relationship between manufacturers and retailers is a special one – a symbiotic one in which both parties can benefit each other with the right advertising techniques.

The key? Co-operation.

When we onboard brands to our platform, we recommend they get behind our program by paying a percentage of the cost through cooperative advertising. Co-op advertising is a cost-effective approach for manufacturers and retailers to share the costs to better reach their target markets.

Through these co-op funded programs, we’ve added over 10,000 retailers representing brands across multiple verticals. But for newcomers to the concept, here’s what you need to know:

Co-op Advertising for Beginners

Co-op advertising is a joint advertising effort established between a manufacturer and a retailer. Its purpose is to save both parties’ money by sharing the costs of advertising at the local level.

Co-op ads depend on a partnership between the manufacturer and the retailer. In such a partnership, manufacturers give retailers funds based on the number of products they sell. Retailers benefit from greater brand exposure without the increased ad spend while manufacturer benefit with increased business at a lower cost.

As a manufacturer, it’s up to you how high a percentage to subsidize a retailer’s advertising budget. We recommend a 50/50 split for manufacturers who use co-op funds with our platform, though some may cover 75% or even pay 100% of the advertising cost. Manufacturers can decide on how much to pay based on the previous year’s purchases, a retailer’s current orders, or the like. You are in control of the amount you offer.

As a retailer, you would be remiss not to take advantage of co-op advertising. With free money sponsored by the manufacturer, you can receive a reimbursement of your marketing costs each time you run an advertisement or marketing campaign that features the manufacturer’s wares. With some manufacturers willing to pay 100% of your advertising costs, local advertisers can benefit from the co-op agreement.

Using Co-Op Advertising for Social Media Growth

The co-op theory is simple: The more you spend on advertising, the more exposure your brand receives. Spending money on advertising through a co-op system results in stronger marketing efforts, more branded content across digital channels and more buzz surrounding your products. Using co-op funds on social media advertising is one of the best ways to maximize results.

In a February 2019 Adweek article, Andreas Reiffen outlined the benefits of shifting co-op advertising funds to digital channels – only 20 percent of nearly $70 billion invested in co-op marketing is being used on the digital front ($14 billion). With roughly 75 percent of ad-induced sales coming from paid search and product listing ad (PLA) campaigns, digital co-op marketing is a relatively untapped well that retailers and manufacturers can benefit from.

If your manufacturer offers these funds, make use of them to grow your social media advertising budget and make a greater impact on your audience. Failing to take advantage of co-op ad money is a costly mistake that could result in manufacturers slashing their budgets.

Expanding Your Social Presence

Engaging in a co-op program is an advantageous opportunity that can lower advertising costs and achieve outstanding ROI in your digital marketing campaigns. It’s both easy and practical too:

Get the guidelines. 

Ask your manufacturer for an in-depth description of advertising requirements for your co-op program. Manufacturers will generally require you to be consistent with their branding.

Take to social media. 

Take advantage of digital advertising with co-op funds. Social marketing is an incredible tool for engaging with your audience – 72% of the U.S. is on at least one social platform as of 2019!

Work with an advertising professional. 

Get advice from a professional marketer in creating social ads your consumers will love. Getting help from digital advertising experts can help you make the most of your co-op program.

As a retailer and manufacturer, you should be taking advantage of co-op advertising programs. Put the money toward social and digital media advertising to expand your reach, increase customer engagement and boost website traffic.

Learn more about how brands use co-op programs for social growth through the ThumbStopper platform by clicking here.

Featured Resources
How to Reach a Local Audience With Automated Content Distribution
How to Reach a Local Audience With Automated Content Distribution
The Story Behind A National Powersports Brand’s New Recreational Vehicle Launch
How STIHL Canada Drove a Successful Co-Op Marketing Campaign Utilizing Marketing Technology
How to Get Retailers to Participate in Your Channel Marketing Program
How to Get Retailers to Participate in Your Channel Marketing Program
What Is Social Media Automation
What Is Social Media Automation?
10 Ways to Automate Your Marketing
10 Ways to Automate Your Marketing
How Effective Is Your Social Media Strategy?
How Effective Is Your Social Media Strategy