Co-op advertising is when brands partly pay retailers for the cost of advertising the brands’ products locally. It is an inducement – together with in-store displays, credit terms, discounts and more – to get retailers to carry more product in a better way, so that brands can eventually sell more. One of the famous brands that does this at scale is Intel, with their Intel Inside program, although they target mainly technology producers and not retailers.
At the moment, the vast majority of co-op advertising goes to placing print, TV or outdoor ads. This is what the retailer knows and has always done, and moving online is scary or too technical. What’s more, while placing a print ad here or there is easy to keep track off, and to make sure creative is approved, the thought from the brands’ perspective is that online this is much more difficult.