What is Partnership Marketing and Why Do You Need It?
If you don’t have a certain skill, what do you do? You either learn it or find someone who can help you out. With partnership marketing, you don’t have to choose.
You can start working with innovative marketing partners right away, and if you want, hone your skills as you go. It’s a lucrative practice if you can get it right, but it’s not as simple as it seems.
So, what exactly is partnership marketing?
What is Partnership Marketing?
Partnership marketing is a common marketing strategy where businesses team up to combine their skills, maximize reach, and create more sales.
Even the biggest brands in the world do this from time to time.
Think about Mcdonald’s Happy Meals, they’re always teaming up with other businesses like Disney for marketing purposes. Or, on a more niche level, Adidas working with Allbirds to create a sustainable running shoe.
These are great examples of businesses coming together to gain skills or resources they don’t otherwise have.
It doesn’t have to happen on such a large scale either; marketing partnerships happen between small businesses and individuals all the time. We constantly see merchants working with affiliates and influencers to harness their marketing skills and reach their target audience.
Here are some common types of partnership marketing:
- Affiliate marketing: This is a classic example of partnership marketing. An affiliate sends the merchant traffic and gets a commission on the resulting sales.
- Content marketing: We see partnerships in content marketing with brands linking to each other’s products.
- Influencer marketing: Influencers make recommendations to their followers.
- Loyalty programs: Encourage customers to get their friends to buy in return for rewards.
- Distribution partnerships: This would see a company using another brand’s distribution network to sell its products.
- Sponsorships: We see this a lot in the sports world.
- Licensing: A brand allows another brand to manufacture and sell products using its branding (e.g. Ben and Jerry’s Netflix and Chill’d ice cream).
- Co-branding: Like our Addidas + Allbirds running shoe example.
- Product placement: Every hero in the movies has an Apple iPhone right?
There’s no need to overcomplicate partnership marketing; it’s simply a collaboration designed to boost both parties’ marketing efforts.
Why are Partnerships Important in Marketing?
Very few businesses do absolutely everything well. They each have specializations that they use to create a competitive advantage.
However, that doesn’t mean you can get away with not doing the things you aren’t so good at, and this is where partnership marketing comes in.
Let’s look at this from an affiliate marketing perspective.
You’re a merchant selling homes for bees. You make amazing bee homes, and you’re website is great at converting, but since you just got set up you don’t have the tools or skills you need to reach your target audience.
With partnership marketing you can solve this issue, piggybacking off your affiliates’ marketing skills to grow your audience and reach new customers. The same goes for influencers and social media.
When you factor your partners into your marketing campaigns, you can grow your brand awareness immediately.
Of course, there has to be something in it for your partners, which we’ll get to in a little bit.
The Benefits of Marketing Partnerships
We’ve already touched on some of the benefits of partnership marketing, but let’s dig a little deeper.
The ultimate goal of strategic partnerships, like virtually anything else, is to grow sales!
To make this happen, your partner needs to have something you don’t, and this will normally come down to:
In most types of marketing partnerships, one party is trading their reach and influence, and the other, their products. This is why affiliate marketing works and is so cost-effective: you’ve both got something the other needs.
Your affiliate has access to a large audience, but they don’t have products to sell.
You have great products to sell, but you don’t have the access to your target audience that you’d like.
With initiatives like affiliate marketing and influencer marketing, you solve each party’s problem to grow revenue.
The Drawbacks of Marketing Partnerships
The greatest drawback of partnership marketing is that you give up some control over your brand. Whether you work with affiliates and influencers, use someone else’s distribution, or go in on a co-branding project, if they mess up, so do you.
Your marketing team can put in a ton of work to present your brand in a certain light, but one misjudged tweet from an influencer can unravel all that effort.
This is why you’ve got to have a clear partnership marketing plan that sets out exactly who you want to work with, and how you work with them. You’re never going to have complete control but if you’re aware of the pitfalls and understand your needs and those of your partners, then you’re giving yourself the best chance of success.
There’s an element of risk, but the ability to reach new audiences in new markets is a huge incentive.
Once you find the right partner, you want to hang on to them and ensure continued success so make sure that you’re investing in the partnership.
Selecting the Right Marketing Partnerships
How do you make sure you’re working with the right partner brands?
It’s a mix of having some things in common and others where you’re very different.
- Similar brand values
- Diverging skill sets
- Similar budgetary expectations
- Willingness to create a win-win relationship
One of the first things to look at is brand values.
You work hard to build your brand image, but the wrong partnerships can have a big impact, alienating existing customers in the pursuit of potential customers. For example, a law firm partnering with an edgy, anarchistic influencer probably isn’t going to work (even if they might be followed by the law firm’s target audience).
The one area where you want divergence is in your skill sets. You both want to be able to bring something to the table that the other requires. You might have an amazing marketing manager, but they need a wider range of content to work with (podcasts, webinars, white papers, etc.) in this case, a content partnership could be the ideal option.
When you bring different skill sets to the relationship, that’s when you create win-win partnerships that can make a big difference.
Measuring the Success of Partnership Marketing
You need to be able to show a return on investment from your partnership marketing.
Unless you have clear KPIs and the right software in place it can be hard to measure the effectiveness of your collaboration. This is something that’s commonly experienced in influencer marketing, but it’s also true for partnership programs as a whole.
We’re lucky in digital marketing that we have so much access to data, but when you add another stakeholder, it sometimes doesn’t get tracked properly.
To overcome this, you need to decide on the key metrics you need to track:
- Customer retention
- Market share
- Customer base growth
- Website visitors
- Conversion rates
This will depend greatly on the nature of your partnership, but if you’re not prepared to track results, then it’s going to be a big problem further down the road.
Then, the key is to have high-quality referral tracking software that gives you access to all the data you need.
Cut Your Learning Curve with Partnership Marketing
If you’re a small business, you have to prioritize sometimes.
That might mean focusing on product development and sales at the expense of marketing, or some other combination of things you have to give up.
However, partnership marketing gives you a solution. It allows you to focus on what you’re good at and work with other businesses (or individuals) who are good at the bits you’re not so good at.
Perhaps the easiest way to get started with this is affiliate marketing, where it’s possible to vastly expand your reach almost overnight. Setting up an affiliate program with AffiliateWP couldn’t be easier, but it’s not a passive income like some people say, it truly is a partnership on both sides.
Don’t worry though, we’re here to help you every step of the way and ensure you’re working with the best partners out there.