CO-MARKETING LURES GROCERS;SURVEY SHOWS 82% OF RETAILERS OPEN TO ENHANCED AD EFFORTS

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More than eight in 10 grocery retailers are willing to turn over anywhere from one-quarter to half their trade promotion dollars for equity-building, co-marketing programs.

A telephone survey conducted by Meyers Research for J. Brown/LMC Group also disclosed that only 52% of retailers currently use co-marketing with manufacturers, but 82% of retailers would consider doing so.

Ninety-six percent of respondents felt co-marketing will be standard practice within five years.

TOP CHAINS IN SURVEY

The spring 1996 survey included 50 of the top 75 retail chains, among them Great Atlantic & Pacific Tea Co., Harris-Teeter, Hy-Vee Food Stores, H.E. Butt, Kroger Co., Albertson's and Tom Thumb Stores.

Co-marketing is defined as a program in which a marketer and retailer work together to produce advertising incorporating both a brand and a feature of the retailer.

More involved than co-op marketing-a TV or print ad announcement that a certain peanut butter is on sale at the retailer, for example-a co-marketing agreement promotes the peanut butter but also the supermarket itself by calling attention to a feature of the chain such as its frequent-shopper card.

"Co-marketing programs reach outside the retailer's existing shopper base to build incremental volume, using the brand as a driver," said J. Brown Chairman Jack Brown.

The study found that 78% of respondents were willing to allocate half of their trade funds to co-marketing, while 84% would ante up one-quarter of those dollars.

ACCOUNT-SPECIFIC MARKETING

In ranking the different facets of co-marketing, retailers felt account-specific marketing was the most effective, with fully 100% of respondents giving it the thumbs up as "very effective."

That was followed by store-specific marketing and database marketing, both at 96%; retailer advertising, 94%; and co-op advertising, 90%.

J. Brown's clients include Procter & Gamble Co., Kraft Foods, the American Dairy Association and Hewlett-Packard Co.

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