Cooperative marketing may be defined as an agreement between two companies to market or sell each other’s product while selling their own so as to enhance each other’s service and supply mutual benefits. In other words, selling through cooperative.

It is a result of joint efforts done by 2 or more companies so as to bundle the products or services together for a typical audience. The products can either be complementary, supplementary or may need different seasons.

What is Cooperative Marketing?

Characteristics of cooperative marketing essentially involves understanding or an agreement between two companies going to promote or sell the opposite companies’ products. They also sell their products.

The companies within the agreement try this to enhance each other’s services. This provides mutual benefits. Cooperative marketing results due to the combined or joint efforts of two or maybe more companies.

Typically, they bundle and group the products and services within the hope of reaching a standard target market. In cooperative marketing, products can complement or perhaps supplement one another. In some cases, it can cater to different seasonal cycles.

In the survey worn out 1968 of co-operative marketing societies, the Federal Reserve Bank of India decided to try to do effective linking of credit with marketing. This was done to assist government agencies execute subsidy programs; during this way, the interests of the producers were being fulfilled.

The Latin word co-operari, meaning working together, is the origin of the word Co-operative. It’s a voluntary association or organisation of individuals or entities to market their interests, usually the common economic ones supporting unity, equality, liberty, and economic principles.

For example, cooperative marketing is an association of producers who are able to help one another market their products as an entire, catering to economies that emerge from a large-scale business.

What is interesting about cooperative marketing is that since it’s a voluntary business, patrons attempt to collectively market products for the advantage of each of them during a system governed by democratic principles. The members share all the revenue and savings reckoning on their share.

The members are all owners; they operate and contribute to the commodities and become direct beneficiaries of savings. They should not worry about intermediaries profiting at their expense.

They are assured of the advantages of large-scale business, which might be difficult for them to attain individually. Here, each producer/member has one vote, no matter the amount of shares he buys.

What is cooperative marketing? Cooperative Marketing emphasises the concept of commercialization, although the economic motives and characters make them stand except other associations. The strategy of operation often resembles private businesses, but the differences in their respective reasons are essential.

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Importance of Cooperative Marketing

Since the time marketing has existed, many players have worked together to form a worth which benefits both parties. Functions of cooperative marketing is to ensure that joint efforts produce a synergy which creates better products and environment thereby adding more value to the customer.

The customer always gets more value through cooperative marketing. The customer would get related products or services which can fulfil what’s expected. Two companies joining hands to market one another by bundling products and services together result in better exposure and returns within the future.

In cooperative marketing, where multiple players add tandem, creating valuable benefits to all or any parties, what’s ensured is that the combined endeavours produce a synergy, and this makes superior products, and therefore the whole ecosystem ends up in immense value-addition, for the members further because the end customers.

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Advantages of Cooperative Marketing

Here are some advantages of cooperative marketing:

  • Through collaborative efforts from the involved parties, better returns are achieved. For example, if you’re buying supplies, bulk orders are placed and thus cost is reduced for the entire order.
  • Companies can advertise together and may attain more penetration and reach with the assistance of every other’s marketing network. The common advertising is often done through direct mails, medium or it should be online.
  • The cost of both the parties is additionally reduced at many points. It is done by either giving common advertisements or by attaining higher bargaining power to barter a price to a retailer.
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Disadvantages of Cooperative Marketing

Here are some disadvantages of cooperative marketing:

  • Lack of commitment from members: Members within the agreement may abate or less committed during the course of your time and it’s going to affect the opposite party’s business adversely.
  • Applicability on track audience: The cooperative marketing strategy created could also be applicable to only a component of the target market of the full business.
  • Information sharing: Some businesses have operated individually for years and after they enter into an agreement for cooperative marketing it gets difficult for them to trust the partners with crucial information and it’s going to hamper the marketing of the products.

Example of Cooperative Marketing

Types of cooperative marketing is like selling dope with a burger from McDonald’s at a cheaper price than the overall amount is an example of cooperative marketing strategy.

Similarly, getting a Gym membership for two months with buying of Sports shoes also can be labelled as cooperative marketing because the free gym offer helps sell the shoes and also the gym gets plenty of consumers who come free initially but can become permanent members if they just like the service.

There are many marketing cooperative examples just like the opening of a famous multiplex in an exceedingly new housing complex. This cooperative strategy helps sell more apartments and therefore the multiplex brand gets more sustainable customers for the longer term which also helps the brand image.

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Cooperative Marketing Structure

Marketing cooperative in the Philippines has a different structure than it is in India, which may be two-tiered and three-tiered. NAFED is the apex institution for this at the national level. The first cooperative societies at the bottom level are those who market the farmers’ products particular to their area.

Central Co-operative Marketing unions are there, and their primary function is marketing all the farmers’ produce that they convey purchasable. Usually, their location is at the secondary wholesale markets.

The unions have as their members all people who are there within the primary marketing societies and individual farmer members. In addition, the State level societies function through their offices throughout the state.


Objective of co-operative marketing in the Philippines is to democratise and leave an open and fair field for producers to plug. As a result, individual chances and risks are significantly minimised, and members have lesser cause to fret. a controversy shared becomes a controversy lessened.

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