Advertising Allowance

Content

What is an advertising allowance?

The advertising cost subsidy, or WKZ for short, is the name given to the financial support of one's own marketing partners. With this subsidy, they can either receive discounts and quotas for local marketing activities or take advantage of free promotional items. In this way, your local partners can carry out cost-effective marketing measures and reach their own customers even better and more often.

For whom are advertising cost subsidies relevant?

Advertising cost subsidies are particularly relevant in companies with a large partner network. In this indirect form of distribution, the individual partners are largely responsible for the success and sales of the brand or manufacturer. The company or the manufacturer therefore has a great interest in providing the sales and distribution partners with marketing measures and also in supporting them financially in carrying out local marketing. In addition, corporate structures with a large network of branches or franchise companies also benefit from the allocation of advertising cost subsidies.

Company with partner network
Indirect sales structures
Manufacturers with independent distribution and sales partners
Companies with a branch network

For whom is decentralized marketing relevant?

Decentralized marketing is relevant for all companies that are organized decentrally but still receive guidelines for their local marketing from the head office. Sectors in which this predominantly applies are:

Automobile

Banking

[Translate to eng:] Branche Bau und Handwerk

Construction and crafts

Electronics

Franchise

Gastronomy

Health

[Translate to eng:] Branchen Haushaltswaren

Housewares

Trade

[Translate to eng:] Heiz-, Lüftungs- und Klimatechnik

Heating, ventilation and air conditioning technology

Hotel industry

[Translate to eng:] Branche Inneneinrichtung

Interior design

Cosmetics

[Translate to eng:] Mode und Schmuck Branche

Fashion and jewelry

[Translate to eng:] Branchen Maschinenbau

Mechanical engineering

Travel and tourism

Sanitary

Telecommunications

[Translate to eng:] Branche Vereine und Verbände

Associations and NGOs

Insurance

[Translate to eng:] Getränke & Spirituosen

Beverages & Spirits

Food

Gas stations

Authorities

How can advertising cost subsidies be awarded?

Advertising cost subsidies can be approved in very different ways and given to your own partners.

Allocation of budgets

When awarding a WKZ budget, the partners receive a kind of voucher for a certain amount. You can use this amount to order and book advertising measures. You can also decide whether the budget can only be redeemed for certain measures or for the entire range.

Discounts/Coupons

The use of discounts when awarding advertising cost subsidies means that the partners pay for a specific item (or the entire range) themselves, but can redeem a discount on the invoice. This is like a discount code when shopping online, which allows you to reduce the price by X percent or decrease the price by a set amount.

Quotas for advertising measures

When allocating quotas, you make a certain number of advertising measures available to the partner free of charge or at a reduced price. This enables your partners to carry out a minimum of local marketing without additional costs.

Free advertising measures

In addition to granting discounts and benefits, you can also offer your partners certain advertising measures, for example for individual products, free of charge. This is particularly useful if you want to get your partners to test new forms of advertising or if you want to motivate a particular partner in particular.

Manual request & allocation

The manual allocation of an advertising cost subsidy is usually a request from a partner who would like financial support for a specific form of advertising. You can therefore still approve this subsidy and assign it manually even after the measure has been paid for.

What does an advertising cost subsidy do?

Supporting your own partners with an advertising subsidy can have many effects and advantages. Above all, it helps to motivate the partners to carry out more marketing measures and cross-media marketing. As a result, the brand not only becomes better known, but also reaches a very heterogeneous target group through the many different channels. Especially when introducing new marketing measures such as video advertising or social media ads, it helps to motivate the partners even more by taking over (part of) the costs. This means that new forms of advertising are more likely to be tested and established more quickly by the partners. In addition, an advertising cost subsidy can be used as an incentive or reward for particularly successful partners. This gives them additional motivation, for example to generate more sales. This also strengthens the bond between the company or the manufacturer and the partner.

If you work with independent dealers who may have different brands on offer, you can also have your own products advertised significantly more than those of the competition by assuming the costs for marketing.

Motivation of the (independent) partners
More activity in marketing
Focus on specific marketing measures and campaigns
Strengthen connections with partners

Challenges in the allocation of advertising cost subsidies

Despite all the positive effects that advertising subsidies can have on marketing, the partners and the company, challenges can also arise. In order to master these as best as possible, it is important to know the sticking points and counteract them from the start.

When awarding an advertising cost subsidy, there can be a lot of manual work, especially without the use of shop systems and software solutions. This burdens the company headquarters (or the manufacturer) and the central marketing department and means that less time can be used for planning and conception of the marketing. With such manual processes, it is also difficult to maintain an overview and to provide all partners with uniform and fair grants.

In addition to the actual implementation and the awarding of rebates and grants, some strategic decisions must be made. The company must be aware of which measures should be prioritized and the amount of costs that can be covered.

Once all of these details have been clarified and a simple process for awarding and approving advertising cost subsidies has been found, nothing stands in the way of deployment.

Advertising Allowance

Content

What is an advertising allowance?

For whom are advertising cost subsidies relevant?

For whom is decentralized marketing relevant?