Social Media advertising, as with other online advertising activities, has been reimbursed as an eligible Co-op or Trade promotion activity only on an extremely limited and exclusively prior approved basis.  Social media advertising continues to be at the center of emerging advertising trends with its ad spending predicted to increase from $2.1 billion in 2010 to $8.3 billion by 2015 (BIA/Kelsey via Direct Marketing News).  Now may be a good time to determine if and how social media advertising can be integrated into your Co-op plans.

ACB Can Help...

Phase 2 of ACB's Online Co-op Advertising Guidelines study included ACB conducting a comprehensive analysis of social media advertising to determine how it can be incorporated into a manufacturer’s Co-op program and marketing strategy. As a result, we’ve compiled Social Media Co-op Advertising Guidelines and Documentation recommendations that include ad requirements, qualifying and non-qualifying costs and documentation guidelines. 

ACB's Social Media Co-op Advertising Guidelines can assist you and your retailers in capitalizing on this exciting emerging media.  If you would like a complete copy, please click here.

With Internet advertising rising and 2011 spending estimated to increase 13.8%, manufacturers are increasingly acknowledging the value of Online advertising and incorporating it into their local retail Co-op programs.  During the first quarter of 2011, U.S. Online advertising spending increased by 14.2 percent from $7.1 billion in first quarter 2010 to $8.1 billion in Q1 2011 (Interactive Advertising Bureau – 5/27/11). 

What steps should you be taking now? The creation of a well written Internet Co-op program, installation of sound business processes and the development of turnkey programs will all contribute towards a manufacturer’s ability to capitalize on this media opportunity.

As a follow up to a study conducted by ACB in October of 2010, ACB has further reviewed and analyzed the reimbursement percentages and documentation requirements for various types of Online advertising; including Paid Search, Banner/Display Ads, Web Hosting and Website Development. Today, less than 33% of manufacturers have a formal Internet advertising Co-op policy.   

Recognizing that Online advertising is a relatively new entry into the Co-op ad space, we did find that several manufacturers have not yet documented their requirements by Online ad ‘format’ (i.e. banner, search) but are instead specifying consistent guidelines as relates to all Online advertising.   The analysis recaps documentation requirements and reimbursement percentages for various Online ad formats, and will help you benchmark your local Internet Co-op advertising strategy versus other leading brands. 

With Online advertising continuously evolving and the explosion of all types of Internet media, the landscape of Co-op advertising continues to change.  While the purpose of this detailed study is to make specific recommendations based on current industry standards for Online advertising within Co-op programs, it does not address all types of Online advertising.  To request a complete copy of the Online Co-op Advertising Study, please click here. 

The 100 Leading National Advertisers ranking by Ad Age is available for 2010 spending.  The LNA ranking is based on estimated total U.S. ad spending, consisting of spending in measured media ( as tracked by Kantar) plus unmeasured media spending (as estimated by Ad Age).

In at #19 is Macy's.  Co-operative advertising allowances from Macy's vendors paid for $345 million or 24% of Macy's 2010 $1.4 billion gross advertising costs.  Macy's receives Co-op ad money from more than 1,000 vendors. (source: Ad Age 6.20.11)