the value of association: four strategic partnerships to expand your reach

One increasingly popular approach to boosting a customer base is strategic partnerships. Strategic partnerships need to be just that, strategic. Creating the right type of partnership with the right type of partner is crucial to getting the most value out of the relationship. Which companies would be a logical match for both your products and your audience? What are your long-term business goals? What are the possible pros and cons? These are important questions to ask when deciding what type of partnership to pursue. There are many types of strategic partnerships, each with its own set of unique benefits.

The market reign large companies have long held due to economic advantage is being challenged by the ease-of-access and affordability of the digital age. With the assistance of effective, yet inexpensive advertising and communication options, small companies now have the might to rival big players simply by banding together and combining strengths. In leveraging the brand equity embedded within another company, a better customer experience can be achieved for all involved.

• Westin & New Balance – Understanding a customer’s needs breeds loyalty. Knowing many of their guests work out, Westin Hotels & Resorts partnered with New Balance to create a customer experience that goes beyond just another hotel fitness room. Westin allows its guests to borrow New Balance fitness gear for only $5 through a marketing partnership called “Gear Lending.” Low-cost, value-added convenience for Westin guests equals subtle, persuasive marketing for New Balance. Win-win.
• IKEA & Sonos and IKEA & NASA - Companies can also add value in the form of a product partnership, such as Sonos and IKEA’s joint-effort Symfonisk smart speakers. Furniture design will meet sound design when the duo’s much-anticipated speaker-in-furniture initiative is released this August. IKEA’s next high-profile marketing partnership is not far behind, as they are set to launch a space-inspired décor collection with NASA in 2020.

A value-added partnership between companies involves creating a more complete customer experience through dual marketing efforts.

Companies expanding beyond their core audience can be difficult if not nearly impossible at times. After years of establishing a target audience, successfully moving the target can prove challenging for the internal team. Creating a crossover effect by teaming up with a dissimilar company with a different type of customer base can break through this barrier, drawing the attention of a whole new crowd while adding credibility.

• New York Post & Supreme - The New York Post turned marketing heads on August 13, 2018 when its front page featured only the word “Supreme” in the form of the iconic skateboarding brand’s logo. Supreme had taken out full front and back page ads, causing their youthful audience, not normally known for print newspaper purchases, let alone the New York Post, to suddenly buy up stacks as collector’s items. A brand based on creating small batches of the latest must-have merchandise momentarily thrust a centuries-old newspaper into necessity for people who may have never even purchased such an item before. What was old was suddenly new and relevant again, while owning a logo that normally cost hundreds was now up for grabs for a dollar. This unusual new brand-old brand collaboration instantly opened up new realms of marketing possibility for both entities.
• The North Face & BMW and The North Face & Spotify - The North Face has exemplified the Expansive Audience Partnership on multiple occasions. Teaming up with BMW, they created a buzzworthy concept camper trailer called “Futurelight,” which features The North Face’s Futurelight fabric. The company also collaborated with Spotify to create the first ever weather-triggered release of a popular indie band’s song using geo-targeting. White Denim’s “No Nee Ta Slode Aln” played solely in rainy regions while The North Face and Spotify harmonized to the tune of a new crossover audience. Creating an expansive audience partnership in the right way can make a combination that would normally raise eyebrows eagerly turn heads instead.
• Airbus & Orbital Insight – Last year, world-renown aerospace manufacturer Airbus entered into a partnership with Orbital Insight, a geospatial analytics startup. As part of the agreement, Airbus provided the startup with access to its important satellite imagery. François Lombard, Airbus Senior Vice President and Head of Intelligence, explained at the time, “We build bridges between our database and their tools. We will integrate their analytics on our world-class platform.” In addition to invaluable satellite data, Orbital Insight has gained wider recognition and increased credibility through the partnership. For its part, Orbital Insight has given Airbus the innovation necessary to keep growing and thriving in a quickly-changing, technology-focused world.
• Coca-Cola & Wonolo - Coca-Cola delved even further into the idea of corporate-startup partnerships when it actually joined with two entrepreneurs to co-create Wonolo, an on-demand stocking platform. The veteran cola giant saw rapid returns on its investment in the startup. The innovative partnership led Coca-Cola to a 25x increase in stock coverage and a 75% cost reduction per retail outlet. When done right, gambling on small startups can result in big savings for corporations.

Certain brands tend to appeal to the same spheres of people, making cross-brand strategic partnerships a logical next business step forward for many companies. Entities can work together to create even greater interest from their shared customer base. Finding an ideal consumer brand match can lead to years and even decades of mutual benefit for already-established companies.

• Starbucks & Target - Starbucks and Target have struck a winning balance between indulgence and thriftiness with its 1300+ Starbucks-within-Target locations. According to Robert Carter of market research company, NPD Group, “If your target demographic is someone looking for a bit more premium quality, but also the good deal on home essentials, like the Target consumer is—the moms—Starbucks ties really nicely into that.” The partnership has proven that bringing two fan favorites together can bring additional success for companies.
• Uber & Spotify – Sometimes two great modern technology-based services just work great together. Starting in 2014, person-to-person ride sharing service Uber decided to personalize travel even more by seamlessly transferring a rider’s music stream to their Uber driver’s vehicle speakers. Despite brief consideration to cut ties during some trying times for Uber, Spotify opted to continue the partnership and it continues to this day. Spotify’s tie to the Uber app introduces potential customers to the music streaming service while Uber sets itself apart from competitors like Lyft. Combining Uber with Spotify keeps the companies’ cross-population happy and adds common benefit.

Even the most unlikely of pairs can come together to achieve exponential growth by pulling their audiences into one another’s cultural space.

Mutual business advantage can be achieved when a large, established company showcases a startup’s new digital technologies. A startup’s groundbreaking innovation can also break new ground for already-established companies when the larger company uses it to create a new product or functionality. This can allow the start-up to gain market position, build their brand, and quickly develop reputation by association. Meanwhile, the larger company can leverage the technological advances to outpace its competitors.

The David-and-Goliath relationship once considered a fierce competition can now be a match made in marketing heaven with the right amount of willingness and forethought.

While some companies with a similar customer base are fighting for consumer attention, others are partnering up for accelerated dual interest.

Strategic partnerships can be a beautiful thing when aligned with the right plan and targeted goals. They can grow your customer base and give your business access to new products and services that may otherwise seem unattainable. The first step in any strategic partnership is to determine how you hope to benefit from combining your efforts with those of another company. If the potential benefits are great enough, it is then time to assess your strengths and establish your intended strategic growth areas, such as audience, geographical area of influence and product expansion. Knowing what you want and why you want it will lead you to the right company and the right type of strategic partnership.