Partnerships. Alliances. Collaboration. Building smart relationships has always made good business sense, but now it’s more important than ever - and the opportunities for small businesses are everywhere if you look for and manage them properly. Andrew Armour of Benchstone Consulting explains
Partnerships and alliances are good for business. Big business has always known this - from McDonald’s building global co-promotions with Coca-Cola and Walt Disney to Nike creating trainers that talk to your iPhone.
But alliances can bring significant benefits for small firms too. Think the local gym membership giving you discount vouchers for a sports store when you join - or the pub working with the local sports clubs, so that the after-match drink is always held in the right bar.
So what is a marketing partner? Partnerships are unique, and can be difficult and expensive to replicate, not least for your competitors. And because they are different to normal customer and supplier relationships, they need careful planning and strong relationships. You can always win new customers and find new suppliers, but partners are high value - and high risk too.
Here are the marketing partnerships that every small business can look to build.
Critical revenue streams
These could simply be the A1 customers, the ones that demand specialist services and need 'business unusual' rather than 'business as usual'. They may justify a tailored package or their own account manager. A revenue partner may also be a valuable re-seller or maybe a key sales channel (say a specialist retail chain), or a vital sponsor.
If you have referrers (affiliates), make sure you reward them for passing trade your way and look to explore how they can send even more business to your checkout.
Think: Are you really looking after your most valuable (and hard to replace) revenue streams as partners? Consider making a dedicated plan to nurture the relationship.
Essential suppliers are also, like vital revenue partners, difficult to replace. It could be a key product that you distribute exclusively, or a vital component - such as technology or packaging.
If it is truly critical, then you need specialist relationship management. You could create a Service Level Agreement (SLA) that schedules in stock calls, regular monthly reports and quarterly reviews. Alternatively, consider bundling - a tactic that has been at the heart of the PC and software business marketing - adding something that fits perfectly with your product to add value to your end consumer.
Think: Can you build joint plans and encourage better flow of communication with your key suppliers - to make sure you avoid nasty surprises and maximise new opportunities before your competition does?
Alliances with other, non-competing firms
These allow partners to collaborate and exchange value, building and sharing plenty of smart marketing benefits. For example, a group of retailers who get together to build a late night Christmas shopping promotion is an alliance.
Who is a good fit with your business? What service is the next along from yours that is a natural add-on? This can be as simple as a hairdressers knowing local wedding planners and nail bars, and building a joint offer for brides.
Think: Who are the local market or service allies that you can build a smart relationship with?
Promotional and PR partnerships
These enable you to leverage additional value by tailoring your marketing activities to fit with those from another business. Remember: cash is not the only currency. You can offer value in the form of free products or services, or access to your customer base.
At best, you can get a lot from doing something very simple, such as swapping discounts or adding reciprocal links between your website and your partner's.
And remember, offering your product or service for free is an easy way to leverage and negotiate publicity in local media and at events.
Think: What can you offer and leverage with a promotional partner?
Finally, remember that these tactics are used by big brands because they are cost-effective, they add value - and they work. Isn't it time you added them to your marketing mix too?
Written by Andrew Armour of Benchstone Consulting