Why An Efficient Co-Op Program is Critical For Your Brand

It’s been reported in the co-op industry that $6 billion in advertising spend goes unclaimed every year. Local business owners either are unaware of the co-op budgets allocated to them or opt not to be bothered with the paper trails that make up the cacophony of claims processes. My gut tells me it’s a little of both.

For national brands that sell through channel partners, co-op programs are important. One, it gives companies control over how local marketers are advertising the brand via guidelines and playbooks. Two, it’s expected. Channel partners expect their partner brands to offer co-op programs. If a brand doesn’t offer a co-op program, channel partners will work with competitors that do. In fact, a lot of these programs are virtually identical to one another so brands can gain and retain channel partner loyalty. A third key reason why co-op programs are integral in a distributed channel is that co-op gives manufacturers influence, insight, and solid relationships with channel partners.

So if co-op programs are a critical part of a distributed channel marketing strategy, do you have one? And if you do, does it work?

As with all strategic marketing initiatives, it’s important to continually evaluate efforts or non-efforts, analyze pain points, and pivot as needed. You may be overfunding a traditional claims model when instead you can save the brand through a scalable, more efficient co-op program. Alternatively, you may have a program that is barely there — or no program at all.

If your program isn’t turnkey and is a major pain to run, your brand is most likely contributing to the reported $6 billion in unspent ad funds a year. This is a problem in that you could be on a sinking ship with no insight and no local brand drive. You might even be leaking money in the wrong places. Get off the ship and onto land. Forage programs that are easy for partners to engage with and give you strong attribution to better understand MROI.

In our recently published e-book, “Co-Pay is The New Black,” we define the past and future of co-op and suggest how a brand can bridge the gap between traditional co-op and co-pay, or the ability to distribute co-marketing funds in real time. Be a good brand steward. Don’t leave your partners out of pocket for months at a time while the organization struggles with disparate analytics on local marketing spend. Switch to co-pay!

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