Corporate trade experts warn industry is failing to maximise the value of their branding investment

Corporate trade experts warn industry is failing to maximise the value of their branding investment

Retailers have potentially missed the opportunity to boost their advertising spend by £100 million or more over the last year, according to research by Active International, a global corporate trade business.

This figure is based on Nielsen research, which reveals that retailers spent £998,838,485 across TV, press, radio, cinema, outdoor and online advertising over the last twelve months; when combined with Active International’s proprietary formula, which calculates how much retailers can boost their advertising spend by if they take advantage of being paid in trade credits for underperforming or excess stock. Trade credits are a currency used by corporate trade companies to allow their clients to fund media space in exchange for underperforming stock.

In a typical deal the retailer is paid three times more than the stock’s ‘realisable’ cash value in trade credits. The trade credits can be spent by retailers to part fund media purchases and generate extra value for their advertising campaigns.

Paying out credit where it’s due

Typically trade credits can be used to pay for between ten and 25% of the cost of an advertising campaign. This trade credits percentage is based on Active International’s 26 years of global experience in engineering such deals between retailers, their advertising agencies and media owners.

Michael Parker, head of commercial projects at Specsavers Optical Stores, said: "Part of our international growth in recent years has been achieved through acquisition. Following one of these acquisitions a number of years ago we found ourselves with some unwanted stock that we did not want to sell through Specsavers stores. Working closely with our media agencies, Active provided a solution through trade credits for us to protect our brand integrity and at the same time realise extra value to the business from this otherwise obsolete stock."

Dean Wilson, managing director of Active International, added: “This figure highlights the potential gains that retailers stand to make by taking advantage of engaging with a corporate trade business and being paid in trade credits when left with underperforming or excess stock. Some retailers are already making the most of this service but many are yet to discover the benefits. A lack of awareness of corporate trade means that many retailers are yet to take the plunge but for those who have the gains are clear.”