A Beginner's Guide to Partnership Marketing
For businesses looking to build brand awareness, generate new leads, and boost sales, partnership marketing is an effective strategy for driving growth. In fact, studies show that 54% of companies say partnerships drive more than 20% of total company revenue.
So if you are looking for a simple guide to partnership marketing, read more to find out what it is all about and how you can promote your brand through brand partnerships.
What is partnership marketing?
Partnership marketing is a collaboration between two businesses for the purpose of creating marketing strategies and campaigns that promote one another's products or services. The two businesses involved usually have the same interests – which is to increase brand awareness and promote their offerings to a wider audience.
Partnership marketing offers several benefits for businesses. One of which is that it grants you access to the audience of the business you partner with. For small businesses, partnerships offer an opportunity to significantly boost brand visibility and compared to other forms of promotion like paid advertising, it is more cost-effective to partner with a brand that already has the ideal customers you want to sell to. It saves you the stress and cost of building an audience from scratch.
For well-established businesses, partnerships can lead to increased market share. It also provides the chance to diversify and offer more value to your audience.
For instance, Uber collaborated with Spotify to make Spotify Music available in Uber rides. The collaboration allowed Uber to offer more value to its audience.
Allowing customers to curate a tracklist before a ride leads to them having an enjoyable and personalized experience while on the trip.
The deal also makes sense for Spotify. Uber users will be encouraged to download Spotify so they can also enjoy the personalized DJ experience on their Uber trip.
The Uber and Spotify partnership is a great example of big corporations leveraging each other’s audiences, but regardless of size, marketing partnerships are an effective way to grow your business.
Types of marketing partnerships
Partnership marketing is a broad term that covers several strategies and trends. Depending on your business goal, you need to choose the right strategy to see success. Here are the types:
1. Content marketing partnerships
Content marketing partnerships are a type of partnership where brands collaborate to create and share content that promotes one another.
By collaborating to create content, brands can utilize one another's resources and expertise to grow their reach while keeping their audience engaged. Brands can choose to collaborate on different kinds of content – from articles, podcasts, webinars, videos, whitepapers, and infographics.
Of all the types of partnerships, this is one of the easier ones to do. There are no lawyers required to get started. A simple email with bullet points is enough to kick off the partnership.
Co-branding and co-marketing are often used interchangeably – but they actually shouldn't ever be used that way.
Co-marketing is short for collaborative marketing (or cooperative marketing depending on where you come from). It is just another word for partnership marketing. It is the process of two brands promoting each other’s offerings without having to create new products or services.
Co-branding on the other hand is a big deal. It refers to a partnership in which two brands collaborate to create a new product or combine their existing products to create a more valuable product. For example, Nike and Apple collaborating to introduce the Apple Watch Nike edition or Doritos and Taco Bell collaborating to create the Doritos Locos Tacos.
Co-branding is much riskier than content partnerships as it requires having lawyers involved. It is also a longer process because there are often long lead times in product development and lots of people need to sign off on things like brand usage before getting started. For this reason, co-branding isn’t really ideal for people who are new to partnership marketing because it requires a lot of time and resources.
3. Cause marketing
In today’s world, consumers believe that businesses must play a role in alleviating societal issues. Infact, a study showed that 91% of consumers are more likely to switch to a brand that supports a good cause.
With those stats in mind, cause marketing is a type of partnership that allows a commercial brand to partner with a non-profit to support a social cause. For example, SCUBA or an ocean wear brand partnering with the Sea Turtle Foundation.
Cause marketing offers several benefits to the commercial partner. These benefits include:
- Showcasing social responsibility improves a brand’s corporate image
- It fosters customer loyalty and trust
- Allows a brand to stand out from the competition
For the non-profit, partnering with a commercial business creates more awareness for their organization and also increases funding opportunities. If you’re a small business owner, you can partner with local non-profits in your vicinity and vice versa.
A licensing partnership is an agreement between two parties (the licensor and licensee) in which the licensor grants the licensee the right to sell the product or service owned by the licensor. It can also be the ability to use the licensor’s trademark or patented technology under the licensee’s branding.
Here is a simple example to help you understand licensing.
Nestle and Starbucks entered into a $7.15 billion coffee licensing partnership. Nestle (the licensee) paid Starbucks (the licensor) for exclusive right to sell Starbucks’ products in Nestle’s global distribution network. Starbucks then received royalties on the packaged coffees and teas sold by Nestle.
The partnership allowed Nestle to improve their brand image and also gain access to Starbucks' wide range of products. Starbucks was also able to boost their brand recognition outside North America through Nestle global distribution networks.
5. Joint ventures
A joint venture is an agreement in which two businesses combine their resources and expertise to achieve a specific business goal or project. Joint ventures are common in the technology, media, and real estate sectors.
In a joint venture, the two parties are legally independent. They don’t have any legal responsibilities to each other beyond the scope of the joint venture.
Both parties will also share the assets and liabilities of the joint venture. An example from NerdWallet explains this well. If two real estate developers enter a joint venture to build a house and a bystander gets injured and sues, both developers will share the liability and be responsible for the accident.
Also, the main difference between joint ventures and other types of marketing partnerships is that joint ventures are usually temporary and last till the end of the project.
Joint ventures can be a great partnership option once you’ve established your brand identity and have build your own customer base.
6. Distribution partnerships
Distribution partnerships involve one partner agreeing to market another partner's product or service using their distribution network. In a distribution partnership, one partner can bundle another partner brand’s product or service with their own product or service.
Both brands usually have the same customer base, which means this type of partnership is beneficial to both brands. A customer that is loyal to brand A will trust brand B more if they see them together and vice versa.
Tips for building successful marketing partnerships
Here are tips that will help you build successful marketing partnerships:
1. Find an ideal partner for your business
When choosing a brand to partner with, you must select one that complements yours. Do not partner with brands that are in direct competition with you. It is also best practice to pick a partner that has a similar audience as yours. That way, your offerings will appeal to their audience.
Also, make sure that you set goals before you enter a partnership. Your goals will determine the kind of brand you partner with and how you’ll measure the success of the campaign. For most brands, your goals will be divided into boosting brand awareness and increasing revenue.
How to find the right brand partner
There are several ways you can find an ideal partner. You can either do this manually by performing google or social media searches, or you can use a partnership marketing platform.
Searching for brands to work with manually is hard work and can be time-consuming. Not only is it difficult to find the right partner that will help you achieve your business goals, but it can also be hard to make connections with the brand through cold calling and cold emailing.
On the other hand, using a partnership marketing platform like Intribe enables you to easily find suitable partners that are also looking to collaborate. Think of Intribe as a niche sort of LinkedIn focussed on connecting brands to brands rather than people to people. Intribe allows companies, social enterprises, and nonprofits to easily collaborate to create amazing partnerships.
With Intribe, you will have access to brands that would normally be out of your reach. You can easily find brands in your industry or area that you can work with.
2. Address each partner’s expectations
After you have found a suitable partner, the next step is to organize a meeting to address each partner's reason for joining the partnership.
Sometimes people seek a partner to broaden their customer base, raise capital or share knowledge and expertise. To make sure the partnership is not strained in the future because expectations aren't met, it's important to discuss and agree on them early on.
This will also enable you to to set and track your partnership’s goals.
3. Make it official
After aligning your goals and expectations with your partner, the next step is to make it official. It's best practice to get the details down on paper.
For simple partnerships, details like timeframe of the partnership, what needs to be delivered, and how you will measure success needs to be in writing. This will ensure that both partners know their roles in the partnership. A simple written agreement will also help with conflict resolution if something goes wrong as the partnership progresses.
If the partnerships will include details like benefits, rights, and when huge funds are at stake, you’ll need to draw up official legal documentation. When working on a major brand partnership, getting a legal professional to write up the document is advisable. The document should detail the terms and conditions of the partnership, the part both parties have to play, the budget, the timeframe of the partnership campaign, resources that will be shared, payment methods, etc.
4. Set measurable KPIs and track the results
To measure if your ongoing partnership is bringing benefits to your business, you must set key performance indicators that you can track. There is no point in continuing a partnership if it is not positively affecting your business’ bottom line.
For example, a KPI you can track is ‘partner-influenced revenue’. At a base level, you can track how much sales activity or revenue increment you have gotten since starting the partnership. At an advanced level, you can track your partner’s influence through all the stages of your sales cycle.
You can also track KPIs like ‘number of opportunities sourced by partner’ or ‘your customer satisfaction with partners’ (a customer survey can be used to track this KPI).
Tracking KPIs is necessary for measuring the success of your partnerships. You can custom create KPIs to fit your goals and marketing strategy.
Partnership marketing is an effective way for brands to increase brand awareness, drive sales, and reach their marketing goals faster. It is an accessible, high ROI alternative to paid advertising and other forms of promotion.
In this guide, we have looked at what partnership marketing is, its benefits, types of partnership marketing with examples, and how you can build a successful partnership campaign.
The key thing to remember is that you should always partner with brands that are right for your busines and with Intribe, you can easily find suitable brands to collaborate with.