Cooperative marketing, also known as co-advertising is a practice involving an agreement between two individual companies who concord on sharing the profit or expenses in exchange for mutual promotion/sales of either a product/service acquired through collaboration or each other's products and services. This happens mostly when the two companies' products are complementary or are sold in different seasons. Also, such programs are offered by suppliers to their wholesalers or retailers, as a means of stimulating them to promote the product. It also occurs that two companies using their own distribution channels separately , to promote a product in the creation of which, the two shared both the idea and the budget.
Increasing of means to reach the target market. A co-marketing partner already has access to the distribution channels that regular marketing research teams are trying to discover.
Partners also have the knowledge and expertise about sales, and suppose the partnerships is with a retailer, they know much better the market, having a closer view. A manufacturer can also share the results of a wider market research in order to improve the advertising strategy. Partner's creativity can be used in producing the commercial and combined with guidance from experts and effective placement can result in growth in sales, and eventually boost in demand. But the commercials are usually produced by the manufacturer, the retailer only has to post them in a convenient place for both.
Sharing profit or covering a part of the advertising expenses attract a partner's interest and involvement in promoting your products also. Allowances are usually related to sales, so both partners are interested in each other's success.
A cooperation makes possible a marketing campaign with a larger range than the company initially could afford. Local advertising proved itself to be more focalised, effective and cheaper. There is also a cut in the advertising costs for the retailer.
Loyalty to a certain product can draw a great number of customers to a retailer the agreement has been made with. There are also other advantages both companies involved in a co-marketing agreement can employ for achieving their objectives.
This marketing practice features common marketing forms and more innovative approaches.
Mailing, telephone marketing. The target market are to be mailed
catalogs, special offers or other advertisements featuring the
supplier and the retailer.
Flyers, posters,billboards, banners that are to be posted in strategic public places, with a numerous and significant target public exposure.
TV, Radio advertising. The channels used are also very important as the hour to be aired and the type of commercial proper to the target market.
Internet advertising. Developing a site or just posting ads on high-ranked sites are an effective means of reaching the customers.
Mobileadvertising. Banners can be printed on cars,vans, trucks.
Stationery featuring both companies' logos.
Apparel. Logos of both companies could be printed on employees' uniforms.
The manufacturer usually assists the retailer with the devices needed for the promotion, such as flyers , catalog and store ads,direct mail campaigns, samples and giveaway items, such as clothing, product samples or mugs. The trending course of co-marketing is now a collaboration between companies and social media. Social networks like Twitter, LinkedIn, MySpace, Facebook can draw an impressive demand when cooperating with a company and featuring its ads with the site's content.