How to Capture Co-Op Ad Dollars from Local Businesses

The Story of Co-Op Dollars

Brands make billions of dollars available for co-op advertising to retailers that sell their products. What a local company receives depends on its inventory value and can reimburse them for approved ad campaigns. Unfortunately, a big portion of it goes unused, and digital advertising is often the category that doesn’t capitalize on these funds. The Radio Advertising Bureau reported that in 2021, 43% of small businesses had access to these funds, but only half used them.

This ad budget can drive benefits for all parties. Manufacturers get their products in the spotlight. Local businesses can drive more traffic to their stores, and you get more advertising revenue. If you want to get more of these dollars, here are some great tips.

Find Out What Brands Distribute Co-Op Dollars

First, you have to know where the money is. You may already have information based on your industry expertise and past sales. However, the programs change each year, and the RAB has an excellent resource for members! Check out their Co-Op Directory if you’re a member.

There are other ways to track this, as well. A quick Google search for “co-op directory” will deliver options. Some of these are free, while others require a subscription.

Discuss Co-Op Spending with Applicable Retailers

Next, it’s time to have a co-op conversation. Talk to your clients about what’s available to them and any parameters regarding spending. Retailers do have to make the upfront purchase and then receive the reimbursement. You and your customer can go through all the policies and come up with questions and ideas.

After you have a complete picture of the opportunity, you can contact the manufacturer on behalf of your client. By offering to help them with this, you are removing some burdens from them (and likely a reason they don’t spend their co-op funds). It demonstrates your commitment to them and ensures they can maximize the opportunity.

Define Campaigns for Linear and Digital

Once you understand manufacturing programs and have the request and authorization forms in place, you’ll need to create a campaign strategy. Co-op dollars are good for radio and digital advertising, which complement each other nicely.

Your client likely won’t have much control over the creative, as the manufacturer wants to keep the brand consistent. So, that’s not where the strategy starts. Rather, you want to talk about tactics. What kinds of digital ads make sense for product-specific campaigns?

• OTT/CTV: Video ads that play during streaming are a great option, especially for industries like auto and grocery. The manufacturers of cars and products are in these channels already, so it makes sense to place ads here. You can recommend specific targeting depending on the type of car and items.
• Display with geofencing: Use geofenced display ads to target competitor locations. Going back to the car example, you can set up a campaign that illustrates the vehicle’s advantages and promotions to lure away a buyer.
• Video advertising: Programmatically placing co-branded video ads (manufacturer + local business) can be impactful. Get the targeting right to make sure those who see it will be relevant. You can lift the awareness of your client in the market by associating them with a well-known brand.