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It’s all very well to find strategic partners and grow your partnership programme. But, as fantastic as partnerships are, there’s no point in doing any of that if your partnerships aren’t going to generate ROI for your brand.
If you’re wondering ‘how the hell do you actually make your partnerships profitable?’ then you’ll be pleased to hear that it’s totally achievable with a bit of foresight and preparation. After all, partnerships are a super powerful growth tool (according to reports by Wolfgang Digital and Forrester, they even exceed paid search as a growth channel). You just need to know how to harness that potential for the good of your brand’s pocket!
To help you ensure your partnerships are worth your while, brush up on our 7 tips for creating profitable partnerships.
1. Have a clear reason for partnering
First things first, it’s absolutely vital to consider why you want to partner up in the first place. If there’s nothing specific you want to achieve through a strategic partnership, there probably won’t be much point in forming one. And similarly, if your goals can be better reached through other means (outside of a partnership) then again, now might not be the right time to partner.
When you’re considering what you want to achieve through a partnership, it helps to look at your marketing funnel and consider where it has room for improvement. You might be flying high when it comes to traffic to your site, but struggling with conversion. In this case, perhaps an incentive marketing partnership could help to improve your offering and get customers over the line.
Alternatively, you might be running a successful local business but keen to expand into new geographical areas in order to grow your pipeline. In this case, a distribution marketing partnership could help to accelerate that expansion by allowing you to leverage the audience of a partner brand that has a strong foothold in that area.
The key is to consider where your brand could use a little improvement and then use partnerships to help fill the gap!
2. Don’t just look at revenue
It’s easy to assume that every partnership you form has to be geared towards generating revenue for your brand. But, although it might sound counterintuitive, it’s important that you don’t equate profitable partnerships wholly with partnerships that directly generate revenue.
While revenue can be (and frequently is) a goal when creating a partnership, there are many types of strategic partnerships that are geared around other objectives. Most of these will indirectly help your brand to generate revenue later down the line (sometimes even months after the partnership has come to fruition).
Take sponsorship and product placement, for example. These are both effective partnership types that are geared around boosting brand awareness. Although brand awareness is notoriously difficult to measure, increasing consumers’ familiarity with your brand will influence their purchasing decisions long into the future. This in turn will help to grow your pipeline and eventually start to support your brand in generating revenue.
3. Choose the right partners
One of the best ways to ensure that your partnerships are profitable is to simply pick the right partners.
A big benefit of almost every partnership is being able to leverage your partner’s audience as well as your own. So, looking for partners that have the same target audience as you is a great first step!
Even better is if you can work with a brand that offers a product or service that complements yours. For example, if your company offers SEO content writing services, a good partner might be a web designer. That way, you’ll know that your partner’s audience is likely to be in need of your services (but you won’t be in competition with them!). This is particularly important when it comes to referral agreements, but is also likely to be beneficial for all kinds of strategic partnerships, from affiliate marketing to comarketing.
That said, it’s not just about your partner’s audience – there are also other factors you should consider when finding the right fit. These include your partner’s values (partnering with an airline if you’re a carbon neutral company is unlikely to go down well with your audience!), their reach (too big and they might not want to work with you, too small and they might struggle to help create the impact you want) and their reputation (a brand with a good reputation can help to enhance yours, but one with lots of negative press could harm it).
4. Always put your customers (and potential customers) first
Consumers are the people who decide which brands flourish and which don’t. And they’re the ones you’ll need to mobilise in order to generate revenue for your business. By putting their needs and interests centre stage when you form partnerships, you’ll be well-placed to gain leads, increase conversions, boost brand loyalty and achieve many other objectives that you may be looking to fulfil.
For instance, you could decide to work with a partner on an API integration (a type of product partnership) to improve your users’ experience while using your product. Or, you could choose to team up on a content marketing partnership to help educate your target audience about a topic that they’re interested in. Seasonal partnerships are particularly effective because they rely on predicting what your audience will be interested in at given times of the year and creating partnerships that appeal to those interests.
Whatever route you decide to take, by prioritising collaborations that put customers’ needs first, you’ll be well set to create an impactful partnership that directly or indirectly leads to revenue for your brand.
5. Set clear goals and KPIs
Giving yourself clear goals to work towards is a must if you want to create a profitable partnership and avoid the common pitfalls that can cause partnerships to fail. By setting clear benchmarks and KPIs, you can ensure that you’re driving all your efforts towards getting the results you need from your partnership. You can also ensure that you and your partner are both on the same page in terms of what constitutes success.
Your goals should be SMART, which stands for Specific, Measurable, Achievable, Relevant, and Time-Bound. Crucially, you should put a robust plan in place for how you and your partner are going to achieve them.
It will help to lay out all your ideas, goals, strategies and tasks for the partnership in a central document known as your partner marketing plan. This will help to increase visibility and accountability between you and your partner brand, as well as helping to reduce confusion around which partner is responsible for what.
6. Measure your successes (and failures!)
It’s important to measure your joint efforts regularly, not just when your partnership comes to an end, but throughout your collaboration. Without doing so, you’ll have no idea whether you’re on track to achieve a profitable partnership.
By taking the time to measure and analyse your activities while your partnership is ongoing, you’ll be able to identify areas for improvement. Then, where your partnership is falling short, you can work with your partner to put steps in place that can bridge the gap and increase your partnership’s profitability.
Of course, you should rigorously measure your collaboration after your partnership ends too, and discuss the results with your partner. If your results are wildly successful then this could provide the impetus for you to discuss an extension or negotiate a new collaboration. If not, discuss why this might be and use it as a learning opportunity.
By measuring all your partnerships carefully, you can learn from your most profitable partnerships and use them to create many more in the future.
7. Use your partner’s expertise
The saying ‘two heads are better than one’ has come about for a reason! The chances are that your partner has a whole host of skills, knowledge and expertise that you may not – or simply a different way of looking at things.
As long as your values are aligned, differences like this can be a real positive. Not only will it mean that you can combine your skills to create a far more impactful and profitable partnership than you could alone. But you can also learn from your partner and pick up knowledge that you can use for your brand’s benefit during future collaborations (as well as in-house activities!).
Most importantly, working with a partner brand is a great way to leverage their audience as well as yours. Your partner will have invaluable knowledge about their audience and how to motivate them. So, make sure you listen!
So, if we had to choose one nugget of wisdom for you to take away from this, what would it be? Well, it’s a tough one, but it would have to be to do with setting clear goals. Goals are at the heart of many of our top tips, from determining your objectives to identifying KPIs and measuring your partnership activities consistently.
If you know what you want to get out of a partnership and you’re ready to turn theory into action, remember to book a demo with Breezy. Our partner search engine can help you to find thousands of relevant partner prospects so that you can save time on partner discovery and instead focus on creating tons of profitable partnerships!