• by Jack Loechner , Staff Writer @mp_research, November 2, 2015

According to Brandmuscle’s State Of Local Marketing Report, analyzing trends, media satisfaction, opportunities and challenges facing national and global brands that sell through a distributed network of local affiliates (franchisees, dealers, agents, distributors, channel partners), nearly one-third of local affiliates leave co-op funds on the table for a variety of reasons

In addition to exploring how often and why these free advertising dollars go unused, the study compared the amount of co-op funds marketers spent last year with local affiliate satisfaction across 29 marketing tactics and found misalignment between the types of marketing that brands are funding and what local affiliates said they need to be successful.

Statistical and anecdotal feedback by local affiliates shows that education and support with digital and social marketing are major opportunities for national brands. Reallocating co-op funds to support online marketing and creating education and opt-in programs for tactics like websites, paid search, social media and email will help local affiliates overcome current hurdles of cost and confusion.

Local affiliate marketing habits:

• Nearly half of local affiliates (48%) spent less than $5,000 on marketing annually
• Marketing budgets increased or stayed the same for 90% of affiliates
• Local affiliates don’t have time for marketing: More than half spent less than 20% of their time on marketing. One third spent less than 10% of their time on marketing
• Nearly two-thirds of affiliates (63%) were eligible for co-op or MDF funds

Affiliates were asked to identify the tactics they use to rate their level of satisfaction with each.

Traditional Media:

• Billboards • Coupons Direct Mail • Door-to-Door Free Standing Inserts Flyers • Magazines • Newspaper • Non-Traditional Promotional Signage • Radio • Telemarketing • Television Yellow Pages

Local Events/ Sponsorships:

• Community Sponsorships • Local Events • Major Event Sponsorships • Tradeshows

Digital Media:

• Content Marketing • Email • Mobile/SMS • Text Messaging • Online Display • Paid Search Webinars • Website

Social Media:

• Blogs • Facebook LinkedIn • Twitter

Satisfaction Index Methodology: The Satisfaction Index compares satisfaction with individual media tactics against the average satisfaction for all media tactics.

Overall, 70% of respondents were somewhat or very satisfied with the media tactics they use, so the index benchmarks each tactic against the 70% level of satisfaction. An index of 100 = 70% and relative position above or below 100 shows deviation from this average.

Traditional Media Insights

• Cost remains the most frequently cited reason affiliates avoid traditional tactics, yet brand marketers have allocated 64% of their total co-op spend to the category.
• Promotional signage is used by 81% of local affiliates and ranked first in satisfaction overall with 81% an index of 121 (tied with websites) This means 85% of local affiliates who use signage are either satisfied or highly satisfied with their marketing performance .
• Television and radio both ranked above 100 on the satisfaction index (or above average) indicating that local affiliates are still finding success with broadcast tactics. However, use of these tactics was limited due to the cost involved.
• Direct mail and flyers are the most widely used traditional marketing tactics (85%), confirming that simple print promotions still comprise a lion’s share of local marketing efforts. Flyers also ranked high on the satisfaction scale with an index of 107.  Direct mail was close to average with an index of 97, meaning 68% of respondents were satisfied with their effectiveness.
• Despite being the least satisfying traditional tactic, more than three-quarters of local affiliates still use Yellow Pages (77%), making this old school tactic the fourth-most-used traditional tactic and ninth-most-used tactic in a list of 29.

Local Events & Sponsorships Insights

• Local events, last year’s #1 tactic on the satisfaction scale, ranked third on this year’s list of 29 tactics with a satisfaction index of 119 . Local events were also the second most-used with 87% of respondents.
• The Events and Sponsorships category ranked highest in both satisfaction and use with an average satisfaction index of 111 and average use of 76% . Beyond this, all four tactics in this category ranked above 105 on the satisfaction index, indicating that local affiliates find events to be more effective than other tactics evaluated .
• The amount of co-op allocated to local events and sponsorships continues to grow, but at a modest pace relative to their high use and satisfaction. Additionally, local affiliates complained that certain sponsorships, like local business bureaus, professional societies and industry conferences, do not qualify for co-op funds even though they have proven successful in the past .
• Local affiliates who do not participate in events and local sponsorships felt they were too complicated and too expensive. Specifically for local events, affiliates were nearly split between “cost” and “complication” as the reason they avoided this popular tactic.

Digital Media Insights

• Local affiliates are more satisfied with websites than any other tactic on the list, an impressive feat considering 9 out of 10 respondents use websites as part of their marketing mix. Receiving a satisfaction score of 121 means 85% of local affiliates were either satisfied or highly satisfied with their website as a marketing tool.
• Email also delivered some of the highest ratings overall with a satisfaction index of 115 and 86% of local affiliates using email.
• Unfortunately, co-op investments in websites and email do not align with local affiliates’ satisfaction and use. Only 2% of co-op spending was allocated to websites (up from 0 in 2011) and 1% for email (the same as 2011), representing little to no adjustment in co-op programs to support these channels despite an increasing reliance on these digital tactics at the local level.
• Use of online display and paid search advertising increased significantly from 2014 to 2015 and both tactics earned a high satisfaction rating of 108, meaning 3 out of 4 local affiliates who used these tactics reported success.
• Local affiliates who avoid using online advertising (online display or paid search), cite cost as the main concern this year. With a good measure of co-op spend increasing in both areas, local affiliates are supported financially, but feedback from affiliates expressed a need to receive education, guidance and creative materials to support these tactics.
• Just over half of local affiliates (55%) said they are using mobile/SMS text message marketing, which boasts a higher than average satisfaction index of 105, yet no co-op funding was allocated to this category.

Social Media Insights

• Facebook’s status as the supreme social media network with more than 1.2 billion users extends into local marketing . With a satisfaction index of 106 and adoption rate of 84%, Facebook is the sixth-most-used tactic and eleventh most satisfying tactic in the list of 29 tactics evaluated.
• Of the social media channels evaluated, LinkedIn was the second most used (65%). Local affiliates finding success with LinkedIn tended to focus on the personal side of the social media platform, using it to expand their networks and promote their personal brand to gain trust.
• Blogs rank dead last this year for overall satisfaction. Many respondents said that the amount of time and energy it takes to produce a blog did not result in the ROI they were expecting.
• More so than other categories, local affiliates asked for help from national brands to support social media efforts. Affiliates want help finding tools, processes and content to support social media. Seen as an affordable alternative to traditional advertising, local affiliates like social media’s ability to form personal bonds with customers, but need education and resources to keep up with best practices and content production.

Concluding, the report says that a successful distributed local marketing program means organizing and incentivizing local affiliates throughout the year. These tips will help brand marketers design and execute a well-rounded program that does both of these, while incorporating the lessons learned from this report:

• Support local affiliates about new media and the benefits it can bring if executed properly. Create opt-in programs to aid adoption of the most effective online
• marketing tactics to make local marketing easy.
• Communicate regularly. Share information about national plans including creative, messaging, media plans and strategy. Remind affiliates about co-op funds, expiration dates and best practices. Listen and respond to feedback.
• Review local affiliates both proactively and reactively. Be available to answer questions and provide them with the tools and guidance they need to execute your local marketing and co-op programs annually . Adjust program rules and how funds are allocated as necessary.

For the complete report from Brandmuscle, please visit here.