If you’re wondering what a strategic alliance is, it’s simply an informal partnership between two businesses which are not competing with each other but work together to boost the other’s bottom line. Requiring commitment and not investment, a good strategic alliance has the potential to give impressive rewards.
Strategic alliances aren’t backed-up by a legal agreement which means that it can take some time to build and develop the relationship. This could involve reviewing and refining the agreement, so a strategic alliance should be looked upon as a long-term strategy that will need regular periods of short-term activity. This continued level of commitment and dedication is the main reason that strategic alliances tend to be overlooked as a business strategy.
Rather than thinking of what you can get from an alliance, it’ll be more productive if you think of it in terms of you can give. Strategic alliances are more productive and work best if you focus on helping your alliance partner first, and only then putting some thought into how they can help you in return. Do this and your strategic alliance will proceed more smoothly.
Identifying your ideal strategic alliance partner
Choosing a strategic alliance partner should be viewed in the same way as you’d identify a target customer market. The first thing to consider is who else supplies your customer market: if yours is a business-to-business company, you could look at lawyers, accountants, stationery suppliers or financial advisers for example. If you run a business-to-customer company, other retailers in the same field or service providers would be ideal. To narrow down the potential contenders even further, you’ll need to look for a number of things.
An audience in common
Although their target audience doesn’t necessarily have to be identical to yours, they should have similar characteristics. If your target customer is, for example, someone with young children, you’ll need to target businesses which are more likely to have similar clientele, such as toy manufacturers or children’s clothing retailers.
You are not in competition
Remember that you are not in competition with each other and that your services should be adding value to their customers. Why would they want to help you promote your services when their priority is the promotion of theirs? The greatest benefit will be found in a strategic partner who has a similar target audience but offers a distinctly different service.
Reaching new customers and contacts
Your ideal strategic alliance will have a database of their clients or potential clients that they are willing for you to access. This has the potential to work to your advantage if they aren’t maximising the potential of their database: for example you could offer to add new contacts to their database or help them communicate with their clients in a new and positive way. By doing this you’ll be providing them with something valuable whilst getting access to new prospects.
Do they want to work with you?
Although this sounds obvious, you need to find a potential partner that wants to work with you. There’s little point in approaching a possible alliance that is already happy with their sales and marketing strategy as they’re unlikely to see any value in a new partnership. As a general rule of thumb, if they don’t seem as enthusiastic about the alliance as you are, it’s unlikely to be successful and work out in the long term.
You’ve got something they want
Givers will always gain when it comes to strategic alliances and you need to be able to offer something that a potential partner will want. Provided you can identify this, your strategic alliance will work for you.