There is no hard-and-fast answer to what any business should spend its co-op dollars on. However, there are a couple of items to “call out” before we delve deeper. First and foremost, a reseller earns only one “bucket” of co-op money. This means they don’t get a set amount for Radio and another set amount for Direct Mail, etc. Another question asked of the Co-op Connect Team is…does Traditional Advertising have one bucket of co-op money while Digital has a separate bucket? The answer is a simple no; again, it is one bucket of money, and what the reseller spends the money on is up to them (with the help of their Media Publishers or Agencies, of course!). Where they should spend the money may depend heavily on the products they sell (or the brand’s co-op requirements).

Let’s look at some facts below:

Where to spend your co-op money

• Let’s look quickly at the Ford Motor – New and Blue Advantage Vehicles. The brand itself requires that dealers must spend 75% of their co-op accrual fund on digital initiatives, while the remaining 25% can be spent on traditional media. So, if a dealer has $10,000 in their accrual fund, it is required that they spend $7500 on either Search Engine Marketing, Social Media, Email Marketing, Online Display or Website advertising. The remaining $2500 can be spent on Radio, TV, Outdoor (Billboards or Transit), Print (Direct Mail ONLY – newspapers, magazines are not co-op eligible), or Trade Shows. There are also a few programs that require a 50/50 split of the co-op funds between digital and traditional products, while the majority of brands allow the resellers to advertise in a way that works best for them to drive customers to their stores.
• The best thing to do is to look at traditional and digital options as complementary to each other, versus competing options. A reseller may use a portion of their co-op funds to pay for an upcoming Trade Show and then use the remainder of their co-op funds to do a Social Media campaign letting people know their booth number, hours of the show, and any special “show” offers.
• Before you decide what to spend the money on you want to consider the vertical and the audience. For instance, print advertising does well for the agriculture brands and part of that is due to the rural nature of the buyers. You may have “spotty” Internet, so you don’t look as often (if you do at all), and a Direct Mail piece or even a local Radio spot may get those customers in your door.
• As a reseller, you just want to keep track of how you spend your co-op money. You may buy a billboard on a Monday, and then when a Radio Sales Rep comes in to sell you a spot, they may bring up utilizing your co-op funds when they don’t know you just “earmarked” that money for the billboard. But keep in mind if you sell several different name-brand products you are most likely earning co-op funds for all of them. It may be wise to always use your “Michelin” money for print advertising, then always use your “BFGoodrich” money for broadcast and then use “Bridgestone – Firestone” money for all digital advertising. This is just one example of how you can be sure to utilize all of your co-op money and keep it straight.

Summary
To find out more about our Co-Op Connect Platform or our Co-op Concierge Services, call us at 877-990-2667 or email [email protected].

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