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Reciprocal
Marketing: The Power of Partnerships
Whether the game is
sports or business, any good coach will tell you that teamwork
is the key to winning. In business, companies sometimes put
the teamwork theory to the test through reciprocal marketing.
By partnering to gain marketshare while reducing the cost of
promotions, reciprocal partners often find themselves
receiving unprecedented benefits.
"Wall Street and
investors are closely scrutinizing online companies' ability
to acquire customers and generate revenue while managing
costs," says Idil Cakim, senior media analyst with New
York-based Cyber Dialogue Inc. "Reciprocal marketing is an
intelligent idea."
However, as anyone
who has ever been a member of a team or worked on, say, a
group project will tell you, not all team members are created
equal. While the idea sounds good in theory, to make sure that
your strategic alliance works out well and goes smoothly for
all involved there are several things that should be
considered.
Reciprocal
Marketing: Smart Expansion with Reduced Risk
The
primary motivation for companies to get into such a "group
project" is simple: a chance for greater profitability. Not
only do they get to do their marketing at a reduced rate, but
they also get to use it to reach fresh new faces. And if the
research used is correct, those new prospects are ones with a
high probability of being interested in--and spending money
on--whatever the marketer has to offer. The key to making this
type of group project work is, of course, to do the homework.
One good example of
reciprocal marketing in action is the partnering of Excite's
Blue Mountain Arts, creator of customized online greeting
cards, with Reflect.com. Since both companies' customer base
is largely comprised of women who prefer to tailor their
online purchases, the pair sharing that target audience makes
senses.
In addition to
acquiring new prospects at a low cost, reciprocal marketing
can offer the opportunity to enhance and expand your image as
well as the size and scope of your audience/customer base.
For example, by
partnering in marketing efforts with other similar companies,
a small IT firm with just one location can gain the image of a
large corporate presence. And to increase its potential
customer base geographically, a web design firm might consider
partnering with a hosting firm by offering special discounts
to hosting customers for design services.
One truly
revolutionary example of reciprocal marketing--and of how
advertising has infiltrated our daily lives--is that of the
relatively new phenomenon Business to Employee marketing.
Dubbed B2E, some companies such as GM and Delta are allowing
trusted companies to offer special promotions and discounts to
employees via the company intranet or employee portion of
their websites.
Productive Power
Partnerships: Maximizing the Benefits
A reciprocal
partnership is a partnership just like any other. Falling
short of a merger but exceeding affiliate territory, it places
the two companies together in the eyes of the public. The
perceived strength of this connection can, of course, be
largely controlled by the marketing message that is sent.
While it seems fairly
simple on the surface--and it can be--marketers must select
appropriate partners with the most discriminating of taste,
based on customer demographics, customer service and the
equality of the partnership, among other things.
Some items that
should be carefully considered before entering into a
reciprocal partnership include:
· Be sure your potential partner is a
good match. While it may be helpful for customers,
intuitively, if your company's images match, reciprocal
marketing can still work when opposites team up. A good
match is not always obvious, but there must be some type of
tie for your shared target audiences. This is one case where
all publicity is not necessarily good publicity. Only when
your offer is perceived as interesting and relevant does it
take on value in the eyes of the potential customer.
Otherwise, it is likely to be deemed annoying--if it is
noticed at all--and labeled just another voice in the deluge
of advertising communications to which we each are subjected
every day.
· Make certain the other company's
customer service is up to your standards. By allowing
another company to market to your customers, you indirectly
endorse them and their service. While their poor service
will reflect poorly on them, many customers will also link
you with it. They may even feel betrayed if the involvement
resulted from your recommendation and was a bad experience.
· Make sure that both players have a
fair hand and are dealt one. Weigh your company's
"currency" and tally up the value of what you have to offer.
In an ideal reciprocal marketing situation, both parties are
able to offer promotions that are similarly valued in the
eyes of the potential consumer. This way no one's image
suffers--either for offering an unwanted product/service or
for allowing a shoddy offer to be channeled through to
customers.
In the storm of
marketing and advertising communications that stirs each day,
most companies are seeking a way to offer promotions that
stand out. Since one of the most crucial elements of standing
out is to reach the right potential audience, reciprocal
marketing can offer a port in the storm to marketers who are
willing to do their homework and pitch in to make the
partnership a true team effort--no group project slackers
allowed!
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