” How to boost my sales”? As a business owner, entrepreneur or marketing manager, you ask yourself this question every day. And that’s a good start! This mindset pushes you to be attentive to your environment in order to seize all the growth opportunities available to you: a competitor in difficulty, an emerging consumer trend, a technology that can reduce your costs… This permanent watch complements the more traditional tactics such as marketing campaigns, prospecting, promotions, pricing policy, the conquest of new markets, etc.
But there is a strategy that is neglected and neglected, wrongly because it has an excellent ROI: the partnership! In a Forrester study, 77% of companies said that developing partnerships was ” critical ” to their marketing and sales strategies. Even better: for more than half of the companies surveyed, partnerships generated more than 20% of their revenue!
In this practical guide, LeadIn explains how to leverage partnerships to boost your revenue. Let’s go !
What is a partnership strategy ?
The partnership strategy, or strategic partnership, refers to the collaboration between at least two companies, in a win-win logic, in order to achieve common objectives in the more or less long term while maintaining an independent operation. Strategic partnering can take many forms, such as alliances, joint ventures, research and development collaborations, joint ventures, or, more commonly, simple, well-defined, one-time partnership agreements.Companies that engage in partnering strategies typically want to achieve the following goals :
- Take advantage of the visibility of a better known company to a certain target ;
- To access a new market by partnering with a well-established company in the area in question ;
- Improve its production capacity ;
- Benefit from know-how or technology ;
- Collaborate on R&D by sharing skills and knowledge ;
- Increase operational efficiency, especially in the production or sales force ;
- Share costs and/or risks, especially for the development of a new technological product.
What are the different types of partnerships between companies ?
Insofar as the partnership is a freely negotiated agreement between the stakeholders, it can be said that there are as many types of partnerships as there are companies. Partnerships can be classified into two main typologies : according to the nature of the partnership (commercial, distribution, technological, co-branding…) or according to the type of partner (supplier, reseller, company ” complementary “, influencer).
#1 The different partnerships according to the nature of the collaboration
Here are the 9 most common forms of collaboration if we take into account the nature of the partnership :
- Commercial partnership: it is an agreement between two companies with the aim of developing and promoting their products or services mutually, in particular by recommending the product of the partner during the various commercial sequences ;
- Strategic partnership: this is a long-term agreement between two companies, usually in the form of a financial participation, a joint venture, etc. ;
- Technological partnership: it can be presented as a research and development agreement to produce a common technology, or simply a pooling of resources allocated to research ;
- Distribution partnership: this is the pooling of distribution resources ;
- Licensing partnership: this is an agreement between two companies to exploit the partner’s products, services, technologies, brands or patents in exchange for a royalty ;
- Financial partnership: This is an agreement between two companies to share the costs and risks of a joint project, usually by investing in a joint venture ;
- Co-branding partnership: this is an agreement between two companies to promote their respective brands by associating them on a product or a service (not to be confused with the co-branding partnership, developed below) ;
- Co-branding partnership: This is an agreement between two companies to create a common brand for a product or service ;
- Subcontracting partnership: this is an agreement whereby a company subcontracts part of its activities to another company, in particular to reduce its cost.
#2 The different partnerships according to the type of partner
Overall, there are 4 main types of partners :
- Supplier or service provider partnerships: These are partnerships in which you work with a company that provides you with products or services needed for your business. For example, an online retailer may partner with a product supplier to increase margins and offer a wider range of products to its customers. A restaurant can partner with a delivery company to expand its business to include home delivery ;
- Partnerships with distributors or resellers: these are partnerships in which you entrust the distribution of your products to a company that has an established distribution network. For example, a beauty products company can partner with a chain of pharmacies (or parapharmacies) to have its products offered in these outlets. A publisher can partner with an online bookstore to have its books featured on the bookstore’s website.
- Partnerships with companies ” complementary “: these are partnerships with companies that offer products or services that are complementary to yours, but are not directly competitive. For example, a beauty products company can partner with a hair salon to propose combined offers (haircut + care). A hotel can partner with a bicycle rental company to offer ” sports ” stays to its guests. An ERP vendor can partner with a strategy consulting firm and offer, for example, one month of strategy consulting to companies that opt for an annual subscription.
- Partnerships with influencers or public personalities: you call upon a person who has a large audience (in proportion to your activity) on social networks or in the media to promote your products or services. For example, a business software company can partner with a business strategy expert who has a large audience on LinkedIn. An online training company can partner with a recognized professional coach, etc.
Ok… but does the partnership really work ?
If partnerships are often ignored or neglected by business leaders and marketers, it may be because the results are not there, right ? Not really. In fact, the opposite is true, as the figures show :
- 95% of Microsoft’s revenue is generated through its partner ecosystem (source) ;
- Zoom generates 70% of its U.S. revenue through its partner ecosystem (source);
- According to a study by BPI Network, 44% of companies ” are looking for alliances to find new ideas, new insights and innovation leads “(source) ;
- According to a Harvard Business Review (HBR) study, 94% of tech executives believe that innovation partners are critical to their strategy(source) ;
- According to Forrester, partnerships generate more revenue than Paid Search (28% vs. 18%) ;
- High-growth companies are three times more likely to use Partnership Marketing than companies without growth(source).
For all these reasons, 2, ,000 strategic partnerships are formed each year, with an average annual growth rate of 15%.
5 steps to boost your sales through partnerships
#1 What type of partnership would be most beneficial to your business ?
You are convinced that developing partnerships can help you boost your sales performance. You are already halfway there ! Move on to the preparatory phase.
Based on the specifics of your industry and your company’s strengths and weaknesses, identify the type of partnership most likely to boost your business. You have developed a great software but you lack notoriety ? It can be interesting to choose an influencer on LinkedIn. You are an online store and you use a standard delivery service ? Why not consider a complementary partnership with a delivery company ?
To summarize, this phase consists of analyzing your business on the basis of an internal diagnosis to identify :
- Your weaknesses, which should be the strengths of your future partner ;
- Your strengths, which can be the weaknesses of your future partner for a win-win collaboration.
#2 Search for and find your ideal partner
At this point, you have a clear idea of the type of partner you are looking for, and you have some indication of the nature of your collaboration. It is therefore necessary to launch the prospection to find the ideal partner. Our advice :
- Start with your immediate environment. Sometimes the perfect partner is already in your ecosystem. It could be a customer, a supplier, a peer who works in another company, etc.
- If the first option does not produce results, you can launch a real prospecting campaign. Start by searching on search engines, using your future partner’s industry as a keyword. Make a small shortlist, then find people who work for those companies on LinkedIn to start the matchmaking ;
- Every facet of marketing has gone digital… but partnerships are still made face-to-face, in a nice restaurant, at a trade show or at any other networking event. When you are in the research phase, it can be interesting to strengthen your presence on the events of your sector of activity or, better, of the sector of activity of your future partner, as you defined it in the first step ;
- Ask your network for recommendations: your network of contacts can be a valuable source when prospecting for your future partner ;
- Be persistent: finding partners can sometimes take time and many steps. Don’t give up too quickly because it’s worth it. Your future partner may be that ” X ” factor that puts your business into orbit !
#3 The first contact with your future partner
At this level, you have a shortlist of potential partners. It will be a matter of taking the first step to establish contact. First, start by outlining the benefits that each party will gain from the partnership. Put yourself in your future partner’s shoes : what does this collaboration bring him ?
The second phase consists of preparing your wording. You are in the same situation as a salesperson who has to prepare a good sales pitch to convert a prospect. As a rule, the first contact will be by email or via InMail, on LinkedIn. You can attach a document that summarizes the main points of the partnership.
We recommend two resources for success in this part :
- Our guide to commercial prospecting, including the section on best practices and mistakes to avoid ;
- Our 13 examples of B2B sales prospecting emails to convert en masse, taking care to adapt these templates to a partnership context.
#4 The partnership contract : the roadmap for collaboration
Your contact was particularly interested in your proposal ? It’s time to work on the partnership contract :
- Define the terms of the partnership: Before writing the contract, it is important to clearly define the terms of the partnership. How long will the partnership last? What will be the objectives of the partnership? How will each party be compensated? Who will be responsible for what? Take time to think about these questions and discuss the answers with your partner and legal counsel, if necessary ;
- Write a draft contract. Don’t hesitate to call on a lawyer or legal advisor to help you draft the contract and ensure that it complies with current legislation ;
- Negotiate the contract: Once you have drafted the contract, submit it to your partner for negotiation, even if he or she was involved in drafting the contract. He can then submit it to his peers, collaborators or advisors. Listen carefully to their comments and requests for changes, if any. Work together to find a mutually satisfactory compromise ;
- Draft the final contract: Once you have reached agreement with your partner on the terms of the contract, draft the final contract incorporating the agreed-upon changes. Don’t forget to check that the contract is complete and that all important points are covered.
- Sign the contract: Once you are both satisfied with the contract, sign it and keep a copy for each party. Be sure to follow the terms of the contract and communicate regularly with your partner to monitor the progress of the partnership… which brings us to the next point.
#5 Track KPIs to measure the success of the partnership
Think of the strategic partnership as a marketing campaign. It must be subject to rigorous and continuous reporting to evaluate its success, make adjustments and decide whether or not the partnership should be renewed. The KPIs will depend directly on the type of partnership established between the two parties. Here are some examples :
- Sales generated by both parties through the partnership: If your main objective is to increase your sales through the partnership, you can measure the success of the collaboration by measuring the share of sales that comes from this project ;
- Number of customers gained through the partnership: If your goal is to grow your customer base through the partnership, you can measure the success of the partnership by tracking the impact of the collaboration on your customer base. You can use the Customer Lifetime Value (CLV) indicator to refine your analysis ;
- Visibility generated by the partnership: if your objective is to reinforce your notoriety thanks to the partnership, you can measure its success by following the evolution of your visibility via indicators such as the traffic on your website, the number of followers on your social pages, the top of mind of your company on your target audience, the number of mentions of your brand on social networks and media, etc.
- Customer satisfaction: If your goal is to improve customer satisfaction through the partnership, you can measure the success of the collaboration by calculating the Net Promoter Score (NPS), conducting satisfaction surveys, analyzing reviews and comments, etc.
We advise you to agree on the KPIs before contracting with your partner. Schedule regular check-ins to discuss performance and identify areas for improvement as soon as possible.
In a context marked by uncertainty and increasing competitive intensity, collaboration is a major growth lever. By joining forces with other companies in a win-win collaboration, you can access new sources of revenue, develop your visibility and your reputation, lower your costs by sharing resources and activate unsuspected synergies to boost your growth. Working with trusted partners also means inspiring each other, challenging each other and sharing experiences to grow together. It’s up to you !