These days, it’s becoming more and more difficult for companies to bring in new business. Competition is becoming fierce and consumers are now more sophisticated and informed than ever. Many of their purchasing decisions rely on reviews and referrals from a trusted source – whether it is a friend, family member or a company they already do business with.
It is especially true for online marketers because there is still a lot of skepticism about search engine optimization (SEO), affiliate marketing, paid search, reputation management and online lead generation. Internet technology branches out so widely, making it impossible for one person to offer every product or service, which is why it is essential for companies in the same industry to form strategic partnerships.
What is a Strategic Partnership?
A strategic partnership in business is an agreement, based on a strategy, where the members of the partnership contribute “something” to the partnership that is essential towards the achievement of the business objectives of each participant in the partnership. Typically, the needs of each partner are unique to the others and the strengths (expertise, products or services) are also unique but essential to make the entire partnership work.
A prime example is a technically-focused company that has great products or processes that can benefit many, teaming up with a marketing-based company seeking great technical execution. The former lacks marketing and sales assets and the latter lacks technical execution assets. However, through a joint agreement they can bring each other “the missing piece” to create an effective partnership that benefits each partner and their customers.
Imagine you are a web design company that only specializes in that industry. Web design is all you offer. You would still need marketing to help you build traffic to your website and increase your number of leads. By partnering with a marketing company, your web design company could upsell its design services to the Internet marketing company’s clients, generating more revenue for you and the marketing company.
Then, the marketing company would continue to work with your web design company on updates and the addition of new content for your clients’ websites. It works for both companies because they reach a previously unreachable client or market segment.
Reciprocation and Protecting Your Brand’s Identity
The important thing to remember when approaching other companies for a partnership, or when being contacted yourself, is that it must be beneficial and profitable to both businesses. Any deal that does not benefit both parties is not a good deal. However, remember that no matter how mutually beneficial the partnership is for the companies involved, it must ultimately be most beneficial to the client.
Companies that enter into one of these strategic relationships must be authorities in what they do. Working with an established brand that has a solid reputation will only bolster your own reputation when you partner with them. The reciprocal must also be true. Your authority and reputation must be such that it will improve the credibility and reputation of the business you choose to partner with.
Often, the reputation of one brand will affect the reputation of another brand that works with them. Always do your research and be sure of whom you are partnering with before you agree to anything because these relationships are not meant to be a short-term endeavor or an “easy fix.”
Partnerships are not dates. They are marriages. Clearly issues can arise and those issues must be dealt with effectively to maintain a healthy strategic internet marketing partnership.
Let’s consider two potential issues:
White Label Partnerships and Services
A white label partnership occurs when one company provides a product or service for another company who markets it. The company marketing the product or service will mark up the prices of the company that provides it so that both companies can earn a profit from the sale. For example, the lower cost store brand cereals in a grocery store are actually manufactured by the name brand company who packages it so that it appears as though it is the store’s brand name product.
However, white label relationships pose one of the most difficult hurdles for strategic partnerships. Both companies want to protect their brand, their profit margins and their integrity. Say Company X has a client they would like to refer to Company Y. It would be difficult for Company X to white label the service because they may not be able to conceal Company Y’s involvement or identity.
Similarly, when Company Y has their prices listed on their website – Company X wouldn’t be able to mark up Company Y’s prices, unless, of course, they added significant value to the offering, thus differentiating the product or service. One solution to this is to announce a strategic partnership through a press release syndicated by both Company X and Y. This helps to clarify and inform potential customers that both companies are allied, working together and in sync.
Contract and Payment Issues
In most scenarios where a service is provided, a contract is required. However, this could also cause difficulties between the companies in the partnership. For instance, which company would sign the contract with the client? Which one would collect payments? All of these issues must be discussed prior to the acquisition of a new client. It is essential that the process of assigning duties and responsibilities is done thoroughly and outlined clearly. It is absolutely essential that the client never becomes involved in these details.
Strategic partnerships work, especially in this era of major technological change, as with Google, along with increasingly competitive online advertising. Partnering with a company that has provides your company with increased capability, visibility and market appeal while, at the same time, you provide essential element(s) for your partner that result in many of the same benefits is the cornerstone to building profitable, productive and long lasting strategic partnerships, similar to those we enjoy in our field of internet marketing.
Optimum7 is always interested in building strategic partnerships with related businesses. If you are interested in discussing the possibility of such a partnership, don’t hesitate to contact us.