Do you know how to craft a strategic partnership that will maximize ROI and align your brand with a complementary collaborator(s)?
Strategic partnerships can do a lot to boost your brand visibility and increase market share and profitability if done correctly. But the wrong partnership can cost you tens of thousands of dollars and end up a logistical nightmare. So the question is- how can you scale up your business through strategic partnerships intelligently?
Give yourself enough time. Partnerships don’t happen overnight. While you may get the sign off to proceed with a project or idea, implementation can take much longer. Just as you are managing your internal team with existing deadlines and bandwidth issues, your potential partner is likely dealing with the same. Appoint a lead project manager (PM) to keep an eye on timelines and both parties’ responsibilities. Bi-weekly or monthly check-in’s may be necessary in the beginning, leading up to more frequent communication depending on the project scope.
Let’s find the right partnerships.
How to Work with Large Retailers and Brands to Collaborate?
Lately we’ve been witnessing a lot of partnerships between larger retailers and brands with smaller emerging market designers. Nordstrom have been on the forefront of this. It seems every other month there is a new collaboration. Other retailers are following suit opening shop-in-shops, launching exclusive distribution deals with their brick-and-mortar spaces and elevating their own branded image by working with these emerging market brands. Larger brands are doing it as well. Collaborations between emerging market brands and companies like Levi’s have been giving visibility to brands that would otherwise remain small and niche. A great example is the Adidas x wings+horns collaboration. Adidas, known for collaborating to stay relevant, partnered with wings+horns on a collection of sneakers. This has taken the wings+horns brands to a much larger audience.
Also, don’t be afraid to step out of the box as long as the partnership falls in line with your brand. For example, Poketo has taken their well-curated collection of accessories and other stylish art and lifestyle products to a new pop-up shop at the Museum of Contemporary Art (MOCA) in L.A.
The logistics of collaborations with bigger companies can take a while to negotiate and fructify so plan well in advance.
But how to secure these types of partnerships?
Reach out to the marketing departments of the companies you want to work with. This is your first point of contact. Even though you may be working on a design collaboration, it will be the marketing department that will determine if you’re a good fit and serve as your main point of contact.
As a growing business, working with brands in similar positions to yours with different strengths can be very rewarding. There is an ability to be more agile and nimble and do things faster with a company that’s at the same growth stage you’re in. Look for brands that share the same values and target market but are pushing a different type of product. You can also find interesting cross-market collaborations between industries. Think about a yoga studio partnering up with a health food company or an activewear line partnering with the same health food company. These types of collaborations can be seen in event marketing and product collaborations. If you’re looking to partner with other brands that are producing products but targeting a different market, you may be looking at sharing supply chain resources. Companies like PACT are working with other manufacturers to buy cotton in bulk with famers. Imagine driving costs down without worrying about being cannibalized.
The issues I’ve seen when smaller brands do collaborations are centered on logistics, planning and financial liability. Do make sure you’ve got the right contracts in place.
Don’t Go Small. Not Yet at Least.
While you may get pitched from startups and brands that want to jump on board your growth wagon, be mindful of who they are and how strong your brand foundation is. Has the brand considered if this is really a good fit? Do they have a market or asset to add value to your business? Don’t just do collaborations for collaboration’s sake. This can be a huge time waster and cost you a lot of money. When working with smaller brands, events and organizations, make sure you have the bandwidth and that the ROI is clear.
Four Smart Strategic Partnerships and the Questions You’ve Got to Ask
1. Marketing Partnerships
What are the KPIs (key performance indicators) that will tell us if this is a success? How are we marketing the activation? Who are the key point people and stakeholders? How long will the activation run? What is the budget? What are the timelines?
2. Product/Category Partnerships
Is your company lending the design expertise? Who are the ultimate decision makers? What are the points of sale? How are the marketing, labor costs and profits being split?
3. Supply Chain Partners
How are you sourcing? What types of materials are you using? Is there a focus on sustainability? How often are you producing? What are your quantities for production?
4. Retail Partnerships
What are your goals and expectations for this collaboration? For my brand? Who will be responsible for which expenses? How will my brand be marketed and how will my products be merchandised for this occasion? How long will the activation period run?
When we look at the power of well-strategized, well-executed collaborations, it’s definitely worth it to give it a try. Just make sure it’s a authentic fit for your brand and that you’ve covered all of your bases and defined all of your goals.
Are you interested in scaling up via collaborations but don’t know where to begin? Email us at email@example.com for custom, one-on-one guidance on business development for your brand. Or to learn more actionable tips on your own, visit www.ScalingRetail.com.