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Shared Advertising Can Extend Your Campaign’s Reach

Your business can benefit by striking cooperative advertising deals with manufacturers.

If you’re having trouble finding enough room in your budget to promote your store or product, cooperative or shared advertising may be just the solution. Instead of shouldering the costs alone, much of the advertising cost is paid by an outside source such as a manufacturer or wholesaler. These parties interested in the sale of their goods will often pay up to 50 percent of the advertising expenses, if you as the retailer feature a particular product or brand in your advertisement.

Cooperative advertising is a way to stretch your advertising dollars. By pooling your resources you will be able to buy substantially more space or time in the advertising medium of your choice. Or you may choose to run the same volume of advertisements and simply utilize the 50 percent reimbursement as a cost savings. Often, a retailer will use cooperative advertising to pump up the size and frequency of advertising during a promotion or peak season. The manufacturer often supplies recommended layout and copy for cooperative ads.

If a brand you’re selling has consumer appeal, cooperative advertising is a good investment. If you get a 50 percent share as a dollar-for-dollar match, you in effect save 50 percent on your advertising costs. That’s an offer that’s hard to beat when you are trying to gain visibility in a market made on repeat advertising. Keep in mind that the manufacturer or wholesaler will generally reimburse you after you have incurred and paid for the expense. Be sure you have budgeted for the cash flow of the advertising expense.

There are other advantages to shared advertising. Consumers generally stick with names they trust, and your store or business will gain credibility by being associated with such quality reputations. Achieving such confidence among consumers might take years if you did it on your own.

FYI

Santa Barbara SCORE meets every Wednesday, from 8:30-11:30 a.m., at 402 E. Gutierrez St., Santa Barbara. No appointment is necessary. For more information, call 805.563.0084, visit www.santabarbarascore.org or register for counseling online at www.edmisscore.org/0166.

In addition, the Santa Barbara SCORE Chapter publishes a great tool for aspiring entrepreneurs, How to Start a Business in Santa Barbara County.

However, you should also consider the constraints of cooperative advertising before making a decision. First, you don’t have total control over the content of the ads. You will likely have to make some compromises to accommodate your ideas and the manufacturer or wholesaler’s messages. In some cases, the ads will have to contain specific elements to receive the cooperative support. Often, shared advertising agreements call for pre-approval by the manufacturer. That means you may not receive reimbursement until after the ad has been reviewed and approved. Similarly, you will be unable to run the ad until the manufacturer approves it, a process that may be at odds with your planned advertising schedule.

Cooperative advertising should be considered a component of your overall advertising efforts, not a license to increase overall advertising spending by 50 percent. Also, evaluate the return on cooperative advertising. Do the ads increase consumer spending, foot traffic and awareness? If the answer is yes, then you have found that cooperative ads are a benefit to the success of your small business advertising campaign.

You can plug into a wealth of business know-how by contacting your Santa Barbara chapter of SCORE “Counselors to America’s Small Business.” SCORE counselors offer free, confidential advice about every aspect of starting, running and growing a successful business, even mentoring.

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