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Digital Advantage: Utilize co-op for digital marketing campaigns

By By Jason Holmes
Feb. 5, 2014 at 4:03 p.m.
Updated Feb. 4, 2014 at 8:05 p.m.


As a local business owner selling national or large regional brands, you are probably aware of co-op advertising. And if you aren't, you need to be.

Manufacturers and suppliers use co-op advertising to provide assistance to retailers, sharing the cost of local advertising. These programs can vary wildly and so can their value. However, if you are not utilizing co-op dollars to help pay for your marketing and advertising expenditures, then you are probably leaving real money on the table and missing opportunities.

Some co-op programs pay media companies directly while others allow the retailer to accrue co-op dollars and use them to pay for additional inventory. Regardless of the details, these programs are almost always a win for the store owner.

Until recent years, co-op programs were limited to traditional forms of advertising: print, terrestrial radio, broadcast or cable TV. However, the shift in recent years toward digital advertising has been as dramatic as the overall advertising spending increase. In fact, Ford Motor Co. announced last month that it is now requiring dealers to use 25 percent of its co-op dollars on digital media.

In July, this requirement doubles to 50 percent. Ford isn't alone in this. Chrysler, Scion and other manufacturers have modified their programs to encourage digital spending.

This is no surprise: Most consumers start their car buying journey online.

This trend isn't just limited to cars. In just the past year, we've worked with local businesses to help get their digital marketing campaigns paid for by Valspar, Tony Lama, Chamilia, Wrangler and others.

There are thousands of brands that have funds available for digital advertising support. Large national retailers generally have teams of people within their corporations to ensure that all co-op dollars across all product lines are used within each local market in addition to their existing marketing budget.

As a local business owner, you need to compete with these retailers. Fully utilizing manufacturer co-op programs can help you level the playing field. Just make sure you use the available funds wisely. Working with a team and media company that understand co-ops and can research your individual programs and brands ensures that you don't leave any money on the table.

Jason Holmes is the general manager of Advocate Digital Media, a sister company to The Victoria Advocate that focuses on digital marketing. He welcomes questions and column ideas at jtholmes@advocatedigital.com.

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