When remodelers flourish, their subcontractors and suppliers also flourish. Neil Kelly Co., Portland, Ore., harnesses this truth and runs with it, creating a lucrative source of business by way of cooperative advertising: sharing the cost of advertising with subcontractors, suppliers, and other professional partners.
Founded in 1947, Neil Kelly has been doing co-op advertising for years, recently branching beyond radio and print media into television. Partners pick up about 35% of the company's advertising expenses, which will exceed $300,000 in 2005, according to Martha Kerr, vice president of the $20 million company.
Those numbers may seem daunting to most remodelers, but limited finances are all the more reason to explore co-op advertising. The idea, after all, is to stretch your budget, reach prospects in a variety of venues, and strengthen your ties to the companies that contribute to your success.
Components of a co-op campaign:
Options. Neil Kelly assembles several co-op “packages” that give partners varying degrees of exposure. TV packages range from $3,000 to $100,000, with ads running during the busy spring and fall home improvement seasons. Vendors are invited to participate via a mailing as well and an annual meeting. “The key thing is to ask for it,” says Tom Kelly, president.
Partners. Neil Kelly's co-op partners represent the entire remodeling process, from financing to utilities to painting, and reflect the company's affluent audience (Marvin Windows, Dacor) and green approach (Oregon Energy Trust, a nonprofit that supports sustainable building practices).
Venues. Neil Kelly's co-op ads appear in major local media including newspapers, magazines, radio, and KOIN TV, a Portland CBS affiliate with an affluent viewer profile. Radio and TV ads are brief and straightforward, Kelly says, and frequent enough to create “a powerful presence.” Partners are featured in the ads, and there are hotlinks to their own Web sites from www.neilkelly.com.
Results. Co-op ads drive traffic to Neil Kelly's three showrooms, remind clients to ask for partners' products, and engender loyalty from Neil Kelly staff. “Design salespeople and project managers make a specific point of working with those suppliers,” Kerr says. The benefit is mutual. “The more business we do with them, the more willing they are to do things to our standards.”
TV was “a giant leap” for Neil Kelly, but the medium has paid off tremendously, Kerr notes. Leads increased 21% during last fall's TV blitz, to 850 potential new clients. December sales rose 16%, and January sales soared 71%.