Co-op Advertising: Short for “Cooperative,” Right?

Once upon a time, in a job far, far away, I had a boss that inspired me with the following after a promotion “I’ll measure your success on how many calls I don’t get.” Gives you chills, doesn’t it? His words nearly sank me. Worse than that, attitudes like this guy’s could have sunk the company.

What that old boss was referring to was our co-op advertising program, the “below the line” activities that often happen in-store or within retailer-controlled media. Many old-school marketing directors, like my old boss, see co-op as a necessary evil—a contractual obligation that is time-consuming and, to be blunt, quite hemerrhoidal. Truth is, co-op advertising can be the Sleeping Giant of retail marketing. Well-funded and often ignored, co-op can turn a “shopper” into a “buyer.” But no one seems to want to cooperate. Though in a perfect world, there’s cooperation all around.

Cooperate with the manufacturer’s marketing plan
to make “what to buy” stronger.
With manufacturers that see the whole picture – above the line activities like broadcast, outdoor and print media as well as below the line activities that tend to fall in that “Shopper Marketing” terminology – and coordinate their efforts, great things can happen.  I’ve been a proponent (I considered using “despot” here but thought that might be a little over the top) of the blurred line; however, there’s not really a line anymore.  Traditional “above the line” tactics are being relied upon far less because retailers are demanding more creative media plans and because the attention of shoppers is harder to capture. A plan that leverages momentum on both sides of the line is a better plan, plain and simple. Seasonal businesses, like Lawn and Garden, are a great example. When brands like Pennington Grass Seed line up with their major chains to provide relevant and timely information, like their Learn & Grow section on their Website, it’s more than grass that gets growing. Sales tend to follow.

Cooperate with the chain’s marketing plan
to put “where and when to buy” in the plan.
Retailers that demand access to the manufacturer’s advertising, marketing and promotion plans have figured out how to make their budgets go much further. Go back a couple of paragraphs to my “well-funded” comment. It’s common for co-op budgets to be as high as 5% of the value of gross shipments. One retailer I worked with was the recipient of a billion dollars (yes, that was a “b”) in gross shipments, meaning they had $50 million of our money to spend on their advertising. Cooperatively, we built massive plans that aligned their materials with ours, their selling seasons with ours and their advertising money with ours. Who does that well? Target. They may have laid down some pretty stringent requirements for manufacturers (like emphasizing the color red and creating messaging similar to the Target brand plan), but the association has done great things for the stores, their shoppers and the brands they carry; such as Champion C9 athletic wear.

Cooperate with store departments
to make “total solution selling” real.
Lots of agencies are talking about Shopper Marketing these days. How many actually do it? Shopper Marketing requires a different kind of thinking, a path-to-purchase rigor that opens eyes and then doors. By “cooperating” with shoppers and aligning with their lists to deliver value – contextual and relevant value – marketers are not only delivering better bottom line results, they’re providing shoppers with solutions and winning their long-term devotion. Food stores have done a great job with product bundling for a long time, such as Kroger, who creates cross-department shopping lists that make events like summer barbecues and holiday planning a snap.

For more information, ask a kindergartner.
Building a successful co-op program is not an easy thing to do. It takes the right combination of smart people, intelligent tools and a whole lot of what we all learned way back in kindergarten class: Trust your neighbors; Share your stuff; Help each other out; Play nice.

Just don’t call my old boss for co-op advice.

- Tom Tholen, contributing writer for The Brand Show and chief customer engagement officer at Two West, Inc.


What successful strategies and tools have you used for managing your co-op program? Share your thoughts below or on our LinkedIn Group.