As strategic alliances continue to grow in popularity, with small and large companies alike, many people write asking me about the different types of strategic alliances available. Indeed, like all relationships, there are different ways you can structure your strategic alliance. Whether you want to keep it casual or prefer a committed, long-term relationship, there
As strategic alliances continue to grow in popularity, with small and large companies alike, many people write asking me about the different types of strategic alliances available. Indeed, like all relationships, there are different ways you can structure your strategic alliance. Whether you want to keep it casual or prefer a committed, long-term relationship, there is a wide range of options when it comes to strategic alliances.
Developing the foundation of a strategic alliance
Fundamentally, a strategic alliance is a partnership between two or more partners, who share the same customer base and carry synergistic products and services. For example, if you own a graphic design firm, then you could partner together with a web design firm. You would share a similar base of customers: businesses that are looking to start or re-vamp their image. The services you provide have synergies with each other, while simultaneously being complimentary from the customer’s perspective.
Taking the strategic alliance to the next level, there must be inherent value built into the relationship. The benefits you offer your partner, and vice-versa, must be lucrative enough to allow the strategic alliance to rise to its full potential. Whether you create a commission or cross-promotional relationship, the key is to develop value for each partner.
With some creativity, the potential for strategic alliance relationships are endless. However, the key is to find a close fit, as the more niche your common customer base is, the more fruitful the strategic alliance.
How to format the strategic alliance partnership
There is a wide variety when it comes to formatting your strategic alliance partnership. First, you must determine whether the partnership will be a one-way or a two-way street. Will you provide them with the benefit, or will the benefit go both ways? For example, will you be offering a commission for each sale they recommend? Or, will you also recommend clients to your partner, resulting in a two-way commission structure?
Once you have determined if the strategic alliance will be a one-way or two-way structure, it is time to ascertain what methodology you will utilize in the partnership:
1.) Shotgun announcement: Your partner sends an email or letter out to all of their customers with an exciting offer from your firm, such as a discount code, free shipping, or credit towards purchase.
2.) Tortoise speed: Sending out the announcement or promotion in smaller batches can be a great strategy, especially if the partner has a very large client base. In addition, this can allow you to tailor the promotion to each particular audience, as well as any current trends in the marketplace.
3.) Customer appreciation sale: When your partner’s customers make a purchase, they are offered a “bonus,” customer appreciation product, which comes at a discount.
4.) Giveaway offer: You can jointly offer a free giveaway promotion, choosing a product that has very low-cost for you both. This gives you an ability to increase exposure, branding, and a greater client list.
There are many other creative ways to structure a strategic alliance, but these are the most popular and time-tested methods. Remember, each industry can benefit from a targeted, niche approach, and with planning and the right partnership, your strategic alliance can take your current business to the next level of sales.1 comment