5 Steps to Building Profitable Business Partnerships
No business is an island onto itself. Today, people rely on a number of products and services to help them in both their personal and professional lives. Smart savvy companies know that one of the great ways to extend their products and services is by finding partners that help compliment, not compete with their company.
Your company may have a great product or service already. Could we harness it to complement it with other potential companies, associations that could help expand your customer base? What are potential revenue sharing models we could create? What are potential joint marketing efforts you can embark on? There are so many ways partners can help accentuate your company.
So let’s talk about 5 Steps you can take RIGHT NOW to start building partnership opportunities.
STEP 1. Create a list of potential services that may compliment your product or vice versa.
FIRST CREATE A LIST of your own services, assets, benefits. I probably should have mentioned that. It’s like a full naked audit of everything you’ve got to offer a potential partner. Be detailed, it will come in handy later… I know I wrote this.
PAIR IT UP AGAINST your potential services. For example - If you’re a banquet hall, well a photographer is a perfect compliment right? Ok, that’s easy. How about if you’re a gym? Maybe a nearby restaurant that makes yummy and healthy foods? Could you have an awesome Healthy Party? Invite gym members to bring prospect members, have it catered by this awesome restaurant? Could you have a partnership that sparks a healthy long - term relationship for both of you? Ok, I diverged a bit but I think you get the point.
2. Create a list of all potential benefits for both parties.
The potential benefit and value is what each partner is willing to bring to the table, whether that includes added exposure, joint marketing capabilities, joint product creations, etc.
It’s critical to be clear about what you offer, how much that means to your own bottom line and what the revenue implications are. Be reasonable about your potential benefits, are you over exaggerating the value you bring to your customer? Or does the potential benefit actually become better when you bring those partners together? Sometimes the whole is greater than the sum of its parts.
Be legit about your ability to follow through. Partnerships fall apart a lot during execution because the once-dreamy ideas now have to turn to real follow -through. Whether you have the “assets” as part of your partnership, the ability to follow through on the partnership agreements is what can super charge a negative exchange. For example, you have a monthly e-newsletter and as part of your partnership agreement, you will allow your partner to promote a feature product one a month. You agree to rotate different featured products, track and in exchange generate revenue for both of you. What if you don’t have the resources to do the latter, the follow through. Whether that is a prominent or insignificant part of your partnership agreement, it’s a failure to meet the agreement details. When you are looking at revenue and your forecast is way higher than your actual, how will you look to shore up that partnership deal for both of you?
3. Determine goals of partners and success measurements.
- What is your intended goal? How do you want to measure its results?
- Be up front about expectations. Are you measuring success on revenue gain, new customer acquisition, brand exposure, product sales, etc? If so, how are you also planning on tracking and measuring those results?
- Here are some Key Performance Indicators to get your brainstorming in gear:
- Number of prospects in partner database/partner reach
- Partner assets – email, website, newsletters, offline, in-person events -reach/frequency
- Number of leads/qualified leads generated
- Total sales/revenue generated
- Press coverage ad equivalency
- Cost per lead or sale
4. Create set plans to review success measurements so you can optimize your offerings.
Alright i know you thought we were going to sneak by this. But yes, you do have to chase the review. Often times, companies initiate the deal, but do not follow up on the review. How is it going? This is not just about the goals but how is the process working? For the company, for the customers? Could it and should it be improved.
Make time for this. Why? You have the potential to find new markets, new audiences, and most importantly do it without necessarily breaking out a bigger advertising budget. Maybe some sweat, but you’ve got that in you.
5.Develop the sales pitch / collateral specifically targeted to these potential partners.
At some point, it’s a bit of a sales thing right? You have to make the call, you have to get in front of someone and say hey, I offer this cool amazing thing. And you offer this also cool amazing thing. How can we offer these cool amazing things together?
Remember the work you did up front, way up front where you did your naked audit. It’s about to come in handy. Right now.
Your sales collateral doesn’t have to be the prettiest, fanciest thing bound in a snazzy portfolio. No, it has to be real and it has to have real meat and potatoes to it. Don’t get LOST in designing something fancy. Think facts, metrics, benefits. How will both of your contribute, how will both of you benefit?
Did this article help you? Think I'm missing something or have questions, shoot me an email at Jkim@mkinceptions.com. I would love to hear from you. Tweet me @JisunKimNJ
Overwhelmed? Don’t be. Take it slow, take it one step at a time. Want a little help or advice on how you might get started? I’m in.