Co-Op Advertising and Maximizing the Value for Independent Showrooms and Manufacturers in the Kitchen and Bath Industry
How The Current Co-Op Advertising Model Works In The Kitchen And Bath Industry & How It Must Change To Maximize The Value For The Independent Showroom and the Manufacturer
In the last decade, the world of business has seen a drastic shift in focus from traditional marketing mediums, such as print, radio, and TV to websites, digital ads, and social media.
Of course, this isn’t new news by any means, but this doesn’t mean that traditional marketing mediums are dead. In fact, many businesses still leverage these mediums, but the model looks a little different…
Many businesses in the kitchen and bath design industry that work with a wide range of product manufacturers have seen benefits from leveraging co-op advertising models. In this article, we will explain what a co-op advertising model is and how it works in 2021 in the kitchen and bath industry.
What is Co-op Advertising And Why Should You Care?
Co-op advertising is essentially an ad-sharing model that is traditionally used by retailers. These advertisements typically mention manufacturers who repay retailers for a portion or all of the advertisement costs. Co-op advertising is a cost-effective way for manufacturers, retailers, and distributors to reach their target markets—without overspending or overrunning budgets.
Co-op advertising also works for kitchen and bath showrooms, product manufacturers, and design-and-build professionals. For example, this type of co-op advertising or ad-sharing model allows showrooms to not only save money but also set aside funds for other forms of advertising, such as ads in newspapers, magazines, TV and/or radio, product displays, and so on that are otherwise extremely expensive on their own…. But what about the digital channel?
It is common to see a manufacturer offer a top dealer a 1-3 percent match for their Co-op initiatives—AS LONG AS the advertising initiative is “pre-approved” by the manufacturer.
But what are the co-op options for independent showrooms these days?
Print, Television & Radio – With this method, the design and copy of the ad is oftentimes not the showroom’s call. Other than using a tracking phone number or landing page, there is no other way to track the effectiveness of your investment here.
Displays & Signage – If you cannot see and touch it, the odds are it doesn’t exist simply is not true anymore. This strategy represents a majority of all co-op money in the DPH industry. This is wonderful for people in your showroom, but what about all the rest?
Schwag – A real bottom of the barrel strategy, but does offer some local visibility and cool clothing and office supplies every now and then. 🙂
The Internet Channel – This strategy is going about seeing an ROI with a watch-marker’s precision from all directions. Exact keyword searches for product categories and/or brands in your most profitable zip codes coming from clicks from the 1st page of Google. We call this The 4 Dimensions Of Winning With The Search Engines.
Client Co-op Spotlight #1
At the end of 2020, George’s Showroom came to us with co-op money to burn.
We had approximately $3,000 that HAD TO BE USED by the end of the year.
So, we immediately created an abbreviated Google Ad Campaign for searchers looking for “Bath/Kitchen Showroom Near Me” or “Kitchen Faucets” on Google. We also set up all of the necessary phone calls, contact forms and direction-click-tracking for the campaign so that we could see which terms on Google and Page from their website were receiving sales inquiries.
In 30 days, George’s received 112 trackable inquiries from Google ads through this co-op initiative and now has a very confident idea about what the internet is capable of providing them, through a paid media program, if they ever want to turn that machine on. Funny, all George’s did was ask for the advertising money and it was granted rather effortlessly because they’re a solid account for many of the top vendors out there. Your business may be leaving this money on the table!
Client Co-op Spotlight #2
After meeting the team from Woodhill Supply, at the Luxury Product Group’s Annual Meeting in San Diego back in 2020, they decided to take advantage of the many benefits our “My Plumbing Showroom Website Platform” provides. Josh and Brandon of the Woodhill team also want to take advantage of how our Showroom Marketing Team could help them “win” more inquiries and sales opportunities (for their brick and mortar location and through e-Commerce) as well as control more market-share for their two locations in Western Ohio.
When we did some basic keyword research for the supplier’s to see the value, and hopefully more seamlessly approve the co-op budget requested, what we found was rather interesting. Turns out Google twisted the truth of the numbers here just a tad. 🙁
The actual number of searches for anything bath showroom related in the is over 3,300 and the Google Keyword Tool estimated there were only 10 searches done each month. Moral of the story is don’t believe the projections and do your own research and market analysis!
Josh Laston, Controller and IT Director at Woodhill Supply said, “We need to have a symbiotic relationship with vendors who want their name associated with a top showroom (Woodhill Supply, in this example) when an ideal client is looking for the solution that we can get for them. We are a laggard region of a laggard industry, but if we can be at the forefront in that laggard region, well, that’s a win. Plus, our competitors have to spend more money to get where we are.”
Improving the Ad-Sharing Model for the Decorative Plumbing, Lighting, Hardware, Hearth and Home and Design Community
In summary, although co-op advertising has proven to be beneficial for the design and build community at large, there is definitely room for improvement. The two clients highlighted here and many others have suggested that a professional agent or a broker connect them with manufacturers, determine what their co-op advertising budgets are, and then connect with small showroom businesses and design to build businesses that are interested in advertising channels with manufacturers.
Currently, there isn’t any professional firm on the market that does this for decorative showrooms, which represents a huge opportunity for change. Well, until now… of course. 🙂
The Showroom Marketing Team at Bravo can validate that over 90% of phone calls and form fill-outs came from Google (paid and organic) for a vast majority of our Paid Media clients. To take advantage of our Independence Day special – which will run all through the month of July, all you have to do is ask to learn more about co-op opportunities through Paid Media Marketing with our team and you’ll be taking things to higher profits and beyond before you know it.
Cheers to making big strides in this post pandemic economy.