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Ingredient-branding takes a special position in marketing, as it cannot be clearly allocated to either industrial or consumer goods marketing. On the one hand, the consumer is the end-user of the ingredient, but at the same time is not part of the buying decision for the component, as this is up to the producer of the end product. On the other hand the producer will only decide on the usage of the ingredient - or at least take it into account in the communication policy - if the image of this ingredient will have an effect on the consumer, meaning a positive influence on his or her buying decision.
Cooperative advertising can be used to stimulate the end product manufacturer to advertise the ingredient, though it is seldom done. While "Intel Inside" has success with this large cooperative advertising program, there are few cooperative advertising program offered by other ingredient suppliers.
To investigate this question, Juan Zhang and his co-authors introduced a dynamic cooperative advertising model in an assemble supply chain where the end product manufacturer purchases components from two suppliers. Results show that the reason that there is seldom supplier providing a cooperative advertising program to his manufacturer is that his unit profit margin is too low. They also show that some suppliers could offer their common manufacturer a cooperative advertising program cooperatively.