Co-op Advertising for Distributors: 6 Key Steps

Co-op Advertising for Distributors: 6 Key Steps

Monetary support from manufacturers is an excellent way for distributors to significantly offset their marketing and advertising costs. Each year, however, large sums of co-op advertising funds go unclaimed because many businesses are unaware that they even exist.

It is important for distributors to take advantage of their vendor relationships in order to create win-win scenarios and obtain full value from these interactions.

As channel partners, in most cases, distributors are governed by legal and binding contracts outlining the various arrangements they have with manufacturers to market and sell their products and services. Agreements can be complex and will vary from company to company, but they may also include reimbursement in the form of market development funds (MDF).

Channel partners are often able to submit specific marketing and advertising expenses to the manufacturer for partial or full compensation for campaigns that are part of a promotion for the manufacturer’s products and services.

These co-op advertising reimbursements are available not just for traditional media such as print, direct mail and radio, but also for digital marketing such as demo videos, email marketing or online advertising services such as Google AdWords—all of which can be very effective web-marketing funnels.

Below are 6 key steps for distributors to follow to effectively use co-op marketing resources and successfully leverage brand awareness and credibility:

 

  1. Look into Eligibility. In most cases, the sales reps of the manufacturers you deal with will know if you qualify for co-op funds, how much is available, the various conditions and how to claim any funds. However, sales reps can sometimes have their own arrangements and agendas. If a rep does not seem forthcoming, then you may have to go straight to the source: contact the company’s advertising or marketing managers because they are the folks who allocate these funds including co-op dollars.
  2. Get the Low Down. Be aware that your different vendors may have specific procedures, rules and funding structures governing co-op advertising. For instance, many co-op programs apportion a percentage of your past purchases to a fund that your company can draw upon to pay for supplier-approved marketing campaigns. In other cases, when a retailer buys products from a distributor, the distributor earns and distributes co-op funds based on retailer purchases. Look over each possibility in detail and then choose the arrangements that are most advantageous.
  3. Obtain Pre-approval. Vendors don’t just hand out co-op money randomly. Before you can begin to use any funds, you will have to get your ads or promotions pre-approved by whomever you’re working with. Work with the vendor to make any requested changes to your ads.
  4. Acquire Proof of Performance. Once a promotional campaign has run their course, be sure to obtain proof of performance from the media involved. This serves as verification for your vendors that you ran the ads as you claimed you would. Some suppliers may also need to see verification of incremental sales over the promotion’s duration. This will also help in acquiring future funding.
  5. Submit your Co-op Ad Claims package. When submitting a co-op claims package, be sure to include your pre-approval form, proof of performance and a written request for reimbursement according to the agreed upon terms of the campaign.
  6. Thank your Suppliers. This will help maintain positive, mutually supportive relationships.

 

As a distributor company, you are probably eligible for at least some marketing and advertising support from companies whose products you endorse and sell.

Co-op advertising can be a significant cost-saver that you can apply to cross-promotional and marketing activities in order to ramp up demand for the various product lines that you carry—so take advantage of it!

Want to know more about sales and marketing for your distributor or wholesaler business? Be sure to visit our website at www.moresalesusa.com or download our e-guide.

 

Written by Mike Jennings

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