Partnerships are becoming key to company growth, according to Kantar’s BrandZ ranking of the 100 most global brands of 2018. One glance at social media platforms and partnerships are evident while offline, e-commerce giants such as Amazon continue to forge strategic new partnerships in countries such as India. As brands tussle to grab consumers’ attention with digital marketing trends, the importance of forming alliances in both existing and new industries has gone unnoticed. However, it has become the way forward for companies to maximize the effectiveness of their campaign and visibility. In fact, the benefits of partnerships are becoming increasingly clear to experts. The World Economic Forum has highlighted partnerships as a business trend to watch. Partnerships are now the eighth ‘P’ in marketing and here’s why.
Further authenticate your brand
Earning customer trust is paramount to the success of your marketing campaign and in turn, your sales. Consumer trust is also a vital issue when it comes to business. The 2018 Edelman Trust Barometer showed that only 48 percent of consumers trust companies compared to 58 percent in 2017. Meanwhile, TRA research among Indian consumers showed a similar decline in brand trust. While there are marketing tactics that can boost and earn customers’ loyalty and trust (think influencer marketing and review websites), having support from other brands can add more credibility and genuineness to the message you are looking to get across to consumers. Choosing collaborators that align with your business’ values and message strengthens the message you send to consumers and affects consumers’ behavior positively. One in three consumers said that trust in a brand is one of the top influencing factors in their purchasing decisions. Authenticity and proof are powerful ways to rewrite the consumer trust story; the support that partnerships provide can help you get there.
Expanding your audience reach
The reality is that customers come into contact with thousands of brands. On social media, it is easy for consumers to follow on from one social interaction to multiple brand accounts. For businesses, this is the perfect way to break into new markets and reach larger audiences without an expensive marketing campaign. This helps to increase brand awareness and boost the pool of potential customers. As a bonus, partners can split the cost of breaking into these new markets. Therefore, the cost of acquiring new customers is further reduced.
Identifying potential diversification and new opportunities
Collaborations and partnerships do not have to be limited to homogeneous industries. Cross collaborations can be a viable growth strategy for businesses and either highlight new channels to explore or new untapped markets to infiltrate. The concept of channel marketing comes into play with the aid of partnerships in marketing. Identifying ways to work with another brand can open up new delivery markets, possibly new supplier connections and even the opportunity to collaborate on new products, adding to the business’ product range.
Much of the focus in discussions and publications have seemed to be on digital branding, branding and the need for strategic partnerships in business overall. Not many sources have pointed out the power and role that partnerships can have in the marketing world. The progress of technology has not just opened up a whole new way of marketing for businesses; it has also introduced more options for working with other brands to both of their benefits. By harnessing the potential of technological tools like social media, business partners can make their campaigns more effective.
Strategic partnerships is beneficial to all businesses
In the past, the rationale among business experts was that strategic partnerships are more beneficial to small businesses. While this is true, it does not paint the full picture as both small and large firms can harness the power of partnerships to boost their public image, increase profits, and widen their customer base. The key with partnerships is that both players must have something tangible to bring to the table. For example, a small firm could bring expertise in a particular field to a strategic partnership, while harnessing the experience and reputation of its large partner to reach the target market. This type of collaboration is particularly viable in situations where a business is lacking in terms of expertise in a field. Rob Lee, the man behind the mentoring community MidasNation, pointed out that it is essential for companies to capitalize on their strengths and opt to outsource (or enter into partnerships) to cover their weaknesses.
Ultimately, partnerships can benefit businesses in different ways including providing a competitive edge, a broader market, access to resources as well as expertise. However, it is essential to choose the right business to partner with otherwise it may have the opposite effect. If you partner with a company that has a bad public image, the chances are that consumers will start to link your brand with the same negative reputation.