One of the biggest challenges that a company faces when working with multiple partners is managing MDF (Marketing Development Funds). Gleanster Research made a report in 2015 where it was shown that only 52% of the total 70 billion USD annually earmarked for MDF and Co-op programs usually gets utilized by the partners. This means the partners are wasting or leaving behind $33 billion USD of unused funds in the locker each year.
Among multiple reasons for this lagging, reimbursement process and crushingly slow claims associated with cooperative advertisement are the worst ones.
Customization and Approval
Firstly, the digital ads must be evacuated by the brand marketing management team. It means the partners need to spend time on the advertisement evaluation and then follow the brand marketing guidelines about the customization of contact info and location. Once it is customized by them, they should submit the final customized ad to the brand desk for approval, not before. Sometimes the guidelines are misinterpreted and overlooked. When the brand reviews the ad, they can identify what guidelines and rules aren’t being followed. This way, the ad will be ready for advertisement with the brand’s intention intact.
Long Wait
From the moment the partner decides to take the brand’s co-op offers for a magazine or newspaper ads, 8 to 10 weeks can pass before the partners actually get the money. This explains why only 50% of the co-op offers are executed. Meanwhile, the company or brand has a dedicated board or personnel focused only on providing the administrative approvals, and are also paying 3rd-party claims processors, usually $8 to$25 for each claim. However, the funds to cover all of this comes directly from their campaign budget.
But these are just misconceptions and speculations about MDF & co-op. here is the real fact.
The Truth:
To be honest, co-op advertisement is somewhat dead, which is why it needs replacement. And through-channel marketing is gradually replacing co-op advertising without any honking and noise. Next generation brands are now using technology to raise funds instantly for a campaign, even when the possibilities of fraud are decreasing.
With the help of a TCMA platform, brands are attaching funds straight to a campaign asset, letting the partners get the money instantly. Whatever the tactics of strategy might be, the brand’s fund can only be spent for inventory of tactics on the platform. And these tactics and strategies are integrated with an approved MSP (marketing service provider). This means, no subpar execution and no frauds.
Using the model, company and brands, they can control and get what they want. Partners select the strategy or tactics they want to execute and then they can instantly contribute their partner's portion of the fund with a simple click. The order is fast-tracked to its integrated MSP (Marketing Service Providers) for execution. And the whole process will take only minutes instead of several weeks.
So, if you were holding back this long for the weeks after weeks of processing, you now know that these are just hoax. With recent technology, your partners can get the money instantly and execute the tactics immediately.
