The Power of Brand Partnerships
Brand partnerships, both big and small, have the power to enhance reputations, expand visibility, and generate revenue. While this is not a new concept, it seems that lately this trend is skyrocketing and the power of brand partnerships is increasing. For example, recently, Nordstrom, Walmart, and Williams-Sonoma have all acquired tech-focused startups to boost their offline and online capabilities. Ikea made news when it acquired TaskRabbit, an online platform that connects independent workers to opportunities.
And Macy’s just acquired the New York-based concept store, Story. Story is a store to which brands pay Story a sponsorship fee to appear in a space that gets an entirely new design, product mix, and marketing campaign every four to eight weeks. As I am writing this, Story has just one location in New York City, but the Macy’s deal means that Story’s innovative marketing concept could be on display wherever a Macy’s is found.
Startups are fresh and offer genius new ideas to well-established companies. This especially rings true in terms of marketing techniques. Startups notoriously offer trendier and riskier promotions which can lead brands to new markets and generate more revenue.
What the well-established brands bring to the startup table is a little more obvious. Benefits include more recognition, bigger deals, and a spot on the fast track to a good reputation. These are all the things that most hungry startups crave.
Brand partnerships aren’t always a win-win situation.
Companies that have so much newness to offer each other usually share one thing in common, differences. Well-established brands are less likely to take risks. Why should they? Miscommunication is another giant factor that could lead to a partnership failure. When two things are so fundamentally different, it should come as no surprise that communication styles also vary greatly. And just like any new relationship, one usually ends up putting in more effort and things get awkward very quickly.
So yes, it seems like we are being inundated daily with news of the next great partnership. But we must remind ourselves that these partnerships are making the news because it is a big deal that they are launching and/or succeeding because a significant amount of these planned collaborations don’t ever see the light of day.
How your startup can do this right.
Just because you can collaborate doesn’t mean you should. In fact, if you collaborate with the wrong brand, it can damage your reputation and lead your customers to someplace else that’s less confusing.
Don’t be bullied by the big brand! They want you for a reason. That is why they sought you ought. Do your thing and do it with confidence.
Communication is key. Every aspect of what you, the startup, and the brand hope to gain from the collaboration needs to be well-defined and communicated to the opposite party. Your visions do not have to be the exact same, but they must be understood and respected.
When done correctly, partnerships can take both the big guys and the not yet big guys to new and exciting and profitable places.
David is the Co-founder and CEO of Goji Labs. David loves working closely with passionate founders to understand their vision and help them build beautiful applications while focusing on risk-mitigation. As an author, he focuses on informative and educational blogs that enable our clients to make the most of their businesses.