Fred, re: Coop advertising
I would guess that 90%+ of companies that sell into retail have a coop advertising program. Traditionally, the coop account would accrue funds at anywhere from 2% to 5% of sales, paid at 50% of the ad cost, with proof of performance. The other requirement is to have the company logo in the ad (in the case of Intel, with TV advertising, I'm sure the Intel Inside *tone* is also required). As an example, Compaq runs an ad the cost $1000., they would send Intel a copy of the ad and a copy of the bills, and Intel would send them a credit for $500. and deduct that amount from their coop fund. The coop fund is capped at (?)% of their total purchases.
The reality is that over the years, with increased competition, the programs have changed. Many times "coop" is taken as a straight deduction from invoice, anywhere from 2% to 10% these days. I have no idea what Intel's coop program is.
I'm sure AMD has a coop program as well. When you see the logo of the company, you can usually assume that coop funds are involved. Retailers don't generally like to devote ad space to promote other companies brand names without funding. I've negotiated 100's of these programs.
The AMD folks try to read something sinister into this practice, when the reality is that every consumer company with any sophistication has a coop program. It's the cheapest way to build brand, and it's cost is variable depending on sales.
John |
