Why Is Digital Co-Op Advertising So Hard?

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With digital marketing evolving at such a rapid rate, co-op advertising programs have trouble keeping up the pace. While many brands still fail to even offer digital as a component of their program, those that do need to start innovating in order to steer clear of failure and ensure success. For both brands and retailers, digital co-op advertising shouldn’t be so hard. It’s time for a fresh take.

The Current State of Digital Co-Op Advertising

As it is now, digital co-op is in need of fixing, with an inefficient system that busy retailers just don’t have the time to participate in. In order to eventually be reimbursed for their efforts, here’s the process retailers have to go through now:

  • Wait to get the creative approved by the brand
  • Share and promote across their digital channels
  • Need to prove that they shared and promoted it
  • Depending on the program, may need to show the consumer reach of their promotions

That’s excluding all of the general steps that they have to go through for a co-op program. For retailers focused on running a business, it asks too much of them, and it’s the main reason these programs see such low adoption rates.

We’ve even heard from some more tech-savvy retailers who are already utilizing digital channels that they choose not to participate in digital co-op programs because it’s easier if they just do it on their own. It’s not hard to see why.

Challenges Brands Face with Digital Co-Op Advertising

Right now, co-op advertising programs are outdated, and the digital offerings are typically weak. According to a study by Borrell Associates:

  • Only 69% of brands offer digital marketing as a component of their co-op program
  • Only 37% offer social media marketing program reimbursement

Brands need to start expanding their programs to include digital, but there are two main hindrances to change being made to co-op advertising programs at the brand level:

  1. Brands assume that local retailers are not digitally savvy, with brand managers listing a lack of understanding of digital marketing as the number one reason that retailers don’t participate in co-op programs. (Borrell Associates)
  2. With co-op programs and guidelines that have been in place for decades, it’s difficult to make change within the organization.

While brand managers may claim that retailers are unsophisticated when it comes to digital marketing, many retailers are already utilizing digital media of some kind and have developed organic followings on their own. Those who aren’t may lack the tools or resources to get started or understand the full value.

Because of this, brands need to explain the value of digital to their retailers and affirm by providing education. As an example, client Mohawk Flooring instituted Mohawk University, offering their retailers things like training and webinars that educate on the importance and best practices of social media and digital channels.

>With the difficulty of creating change at the organizational level comes a challenge but also an opportunity. Digital in all of its complexity is allowing brands a chance to rewrite co-op as it currently stands and innovate for the modern age.

The Reality of Failing to Innovate Your Digital Co-Op Advertising Program

What happens when a brand fails to innovate their digital co-op program? Here’s the reality:

  • No alignment: Without a unified system in place, there cannot be aligned, consistent brand messaging across digital channels on a local level.
  • Murky tracking: Reach is not always verifiable, and you don’t know the true impact of retailer participation in your co-op program.
  • Unspent funds: With more than fourteen billion dollars of co-op funds going unspent every year (Borrell), there is a missed opportunity to spend money promoting your products on a local level. Brand marketing budgets are also hit, with dollars decreasing annually because of these unspent funds.

Try the Alternative to Digital Co-Op: Promoboxx Local Adsdigital co-op advertising

In its ability to effectively engage new local customers and drive them in-store, Promoboxx Local Ads works as an alternative to digital co-op programs. This is the way things are moving. Compared to traditional co-op programs, the technology behind Local Ads ensures more efficient execution and higher-quality advertising at scale. Here’s how:

√ Brand-approved content: Brand content is made available to local retailers. No more worries about what is being displayed.

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Co-branded Facebook example for an Arc’teryx specialty retailer

√ It’s programmatic: The media buying process is automated across Facebook, Google, and mobile display, making it simple for all of your retailers to participate.

√ Advanced targeting: Efficiently market to potential local customers near each storefront, increasing awareness and foot traffic. No more wasted ad dollars.

√ Total transparent pricing: 100% of Local Ads funds are spent on high-quality advertising, and Promoboxx charges a management fee as a percent of ad spend. No hidden costs. Ever.

√ Verifiable tracking: Access to valuable insights into consumer reach, retailer activity, and more. No more guessing about what’s working and what’s not.

By leveraging Local Ads, brands like GE Appliances, Shaw Floors, and Electrolux extend sophisticated content, targeting, and media mix to local retailers, benefiting both by reaching nearby customers on mobile devices and bringing them in-store.

Ready for a Digital Co-Op Advertising Cure? Contact us >


Related Content:

Announcing Local Ads: Aligning Brands & Retailers to Drive New Customers In-Store >

Co-Op Advertising Is Walking Dead >

What’s the Future of Co-Op Advertising? Marketers from Timberland, AutoTrader, GE Appliances Weigh In >


Categories: Co-Op Advertising is Walking Dead, Promoboxx Local Ads

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