Despite an uncertain global economy, one thing has remained on a steady incline –advertising investment. Zenith Optimedia’s ad spend forecast predicts a jump of $24 million in North America and almost $100 million around the world from 2010 to 2014.
Meanwhile, CXOs across North America are seeking ways to improve their cash flow and reduce operating expenditures. More than ever before, marketers are put under the microscope each month to produce results and deliver a positive ROI.
How does an advertiser effectively protect the integrity of their media strategy while being tasked with slashing their budgets to support corporate cash management initiatives?
Many are turning to Corporate Trade (or Corporate Barter, depending on your semantic preferences). Here are 7 reasons why they’re making a smart decision.
1. Trade Credits are a proven way to lower the cash outlay on your Advertising expense.
The Corporate Trade industry has established a 28-year old track record , growing currency of Trade Credits. Once you’ve obtained Trade Credits, you can use those credits to pay a portion of your invoice across a variety of business expenses, media being the most popular. .
2. There are many things your business can trade in exchange for Trade Credits.
Companies often think that they only reason to use corporate trade is to address a problem, however, in the normal course of business, many things happen. Packaging gets redesigned, weather is unpredictable, fashions change. As a result, the types of inventory that can be traded in exchange for Trade Credits is virtually unlimited. And it’s not just limited to inventory. Here are a few examples:
- Re-branded product
- Last season’s clothing or accessories
- Perishables e.g. groceries
- Product labeled with expired promotions
- Outdated electronics or technology such as mobile phones and personal computers
- Obsolete capital equipment including old machinery or furniture
- Excess or problem real estate
- Unwanted, costly, sponsorship commitments
- Debt owed
3. By reducing your cash costs, you can redirect the “savings” towards other programs you’ve wanted to launch.
Let’s face it – as marketers, we never have a big enough budget. All too often that really big, really innovative idea is trimmed back because of budget concerns. Whether you’re a client side marketer or leading an agency, bringing a strategy to the table that puts more dollars behind those big ideas is a good thing. And with Corporate Trade, you’re not just limited to traditional media. Advertisers can use Trade Credits across virtually any medium available in the market thanks to the strong relationships with media providers.
4. You can start turning those tough agency conversations around.
How many tough conversations have you had with your agency around resources and budget? How many times has your agency been sent back to the drawing board? With agencies being marginalized every day, it can be challenging to maintain the level of true partnership you want (and need). Corporate Trade puts money back in your pocket, empowering your agency to execute your brand to its fullest potential.
5. You don’t need to sacrifice your need for flexibility.
As a Corporate Trade / Barter partner, it is understood that many businesses require adjustment to schedules with limited advance notice. For example, at Active International the process is customized to the needs of our clients and has been designed to accommodate changes to specs/schedule.
One of our clients for example, a leading home & garden retailer, makes many media buying decisions based on the upcoming weekend’s weather. They rely on us to be flexible and accommodate schedule changes with very little notice. They’ve been a client for over 20 years.
6. You're a Global business? No problem.
At least not if you count on an established, global Corporate Trade partner. You’ll find that good Corporate Barter firms also allow the flexibility to transfer trade credits from country to country. Established Corporate Trade companies have a global presence (Active International have presence in 14 countries). This means that inventories can be distributed outside your local market, avoiding channel conflict and expanding your distribution channels. It also means you can use your Trade Credits globally. Give your international sister company a call; they may already have Trade Credits available to transfer to you.
7. Your CFO will love you.
Trade Credits help to improve business-wide cash flow while avoiding loss on significant assets. In fact, your Trade Credits can also be used and transferred to other areas of the business. Look for companies with the widest depth and breadth of fulfillment areas where Trade currency is accepted - including business expenses such as travel, freight, and retail merchandising.
How are you balancing business cash flow requirements with the integrity and scope of your advertising plan?