A gallon of nonhomogenized whole organic milk was about to expire and on clearance at our health food store. Unafraid of expiration dates, I snagged it and made yogurt this past Monday. This is what I do for a whole gallon (more step-by-step instructions with a half gallon back here) to let it incubate. I fill the original gallon jug with hot tap water, put the jars of milk/yogurt and the water jug in the cooler, then fill the bottom of the cooler with a few inches of hot water. Close the lid, and leave it overnight. I find that when I have the cooler mostly full like this, it stays warm enough. If you have a bigger cooler, you could add another jug of hot water if you have it, or just exchange the cooler water for hot water again once during the process.
I have one friend who wants some whey and yogurt from this, another who will take the yogurt cheese, and then I’m keeping some whey for ourselves to use in bread, falafel, and lactofermented foods. The whey helps break down the anti-nutrients in the whole wheat flour for bread and the beans for falafel, and adds good bacteria during the fermentation process.