Survey: Awareness, Paperwork Main Barriers to Accessing Co-op Billions
September 5, 2017 | Contributed by: Greg Sterling
While people debate the ultimate figure, LSA and others estimate that about half of the nearly $70 billion allocated to fund co-op advertising programs goes unused every year. That’s a staggering amount of money left on the table.
There’s a perception that that co-op money is harder to get or less available than it used to be. That’s not accurate. But many publishers, business owners and agencies are either unaware of the availability of the money or don’t want to jump through the hoops required to get it.
LSA recently conducted a survey of 178 media and marketing firms which serve the SMB market. The findings are contained in a new report called Tapping the Multi-Billion Dollar Co-op Advertising Opportunity.
Are Co-op Campaigns Worth the Time/Effort Involved in Fulfilling Them?
The respondent-organizations represent a range of LSA members and non-members, including traditional media companies (i.e., print yellow pages, newspapers and out-of-home) and pure-digital sellers, all of which sell media and marketing services to SMBs at the local level.
According to an earlier LSA and Manta study, 43% of U.S. SMBs sell branded products that potentially qualify for co-op funding. In other words, almost half of SMBs may be eligible for co-op funds. Of those pursuing co-op funds, despite the complexity, the majority say it’s worthwhile.
The graphic below shows how survey respondents deployed co-op money. Online display was second after newspapers. Paid search is the next-in-line digital format, with other digital channels and formats at lower levels.
Where Co-op Funds Are Being Used
The percentages above don’t represent dollar figures but the numbers of agencies, publishers and SMB services providers tapping and deploying the funds to these channels. Obviously there’s a great deal of “headroom” for digital to grow.
The survey also explored some of the sources of friction and barriers to co-op that the market faces. The top three, as might be expected, were exposing the opportunity to the SMB customer, dealing with the requirements and paperwork and then working with the brand/manufacturer.
Biggest Roadblocks to Co-op Usage
As you might also expect LSA can help with all these things. We have a service bureau that identifies the opportunity and helps manage the paperwork and relationship with the co-op source.
The full survey findings and report are available for free (after registration).