Cooperative Advertising occurs between a manufacturer and retailer. It is most beneficial to small businesses and local companies because it helps them to expand the amount of its campaign.
What Is Cooperative Advertising?
Cooperative advertising is when more than one firm agrees to partner with each other with the common aim of promoting their brand within a specific market. Mostly between the manufacturer, distributor, wholesaler, and retailer or in most cases the manufacturer, wholesaler, and the retailer.
Here the manufacturer, distributor, and wholesaler provide support to the retailer in promoting their products. Through cooperative advertising, manufacturers make funds available to distributors and the local retailer in order to increase the awareness of a product in a specific region. The cost of advertising is being shared between the companies involved.
Cooperative advertising may involve several means of advertising like radio and television, flyers, ads, direct mail campaigns, catalogs, trade show booth materials, trade magazines ads, etc.
Merits Cf Cooperative Advertising
— Reduction of Advertising Cost:
This is one of the many benefits of cooperative advertising whereby the estimated cost of advertising is reduced because of the shared cost of placing advertisements. This is very advantageous in a way that it expands the marketing budget that one company could not execute, thereby reaching out to a wide range of people.
— Major Production Quality
When a local retailer enters into a cooperative advertising agreement with a manufacturer, might be a national or an international manufacturing company, it gives the local retailer the opportunity to assess national or international campaigns.
This enables the production quality of their ads to increase and the chance to benefit from the costly campaign. The high quality of production materials of which they make use increases their level and standard and sets them apart from their local competitors. This gives them a more expert or professional figure, presenting them as superior to their competitors.
— Increased Public Recognition
When companies come together and create a collaborative advertising agreement, they widen their presence to the public. For a local business, it helps to increase its reputation because of working with a highly reputable manufacturing company.
For a national manufacturing company, it helps to increase its credibility within the interior market because of its working agreement with the local company or retailer who may be well known and respected locally, thereby being seen as a reliable company.
— Shared Marketing Knowledge
It is common for every company’s marketing department to have strategies that they adopt in advertising. When coming together for the purpose of cooperative advertising, most companies may decide to bring this information to the table. They share this information with each other in order to provide cheap ways to widen their marketing awareness within a specific region. This information does not only help in the proposed advertising campaign but also in the future.
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Cooperative advertising is not all cozy and comfortable, there are however some setbacks that may likely be experienced.
— Contrasting Ideas
In cooperative advertising which involves two or more companies. It is important for the companies involved to take part in decision-making and be comfortable with the materials to be used for the campaign. In a situation where there are contrasting options, there will be a compromise in making content where one company maybe be forced to go beyond its standard to fit in.
— Confusing Brand
Entering a collaborative advertising agreement with two or more companies can lead to an advertisement that creates an impression to the public that there has been a merging of the companies, thereby confusing brands.
Summarily, when planning to enter into cooperative advertising, it is pertinent to choose your partner wisely and carefully so that the result will be of benefit to the parties involved.
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