TREND: Co-op is under pressure and will be replaced by increases in direct vendor advertising.

Universal, in addition to cutting prices, did away with co-op advertising. The Wall Street Journal quoted a Universal VP “It (co-op) was a misnomer. It was money that went to retailers. They did not co-operate in any way." Instead Universal will raise its own advertising budget significantly.

Expect greater scrutiny of channel expenses and increased expectations of measurable ROI.

Scott@ChannelVentures.com