Strategic Alliances

.
Alliances have become an integral part of contemporary strategic thinking.
-Fortune Magazine

As previously discussed, the Core Sales Numbers in building your business are:

A. The number of prospects generated by your advertising
B. The conversion rate of prospects to customers
C. The average value of each customer over a given period of time

Strategic Marketing Alliances allow you to augment your Core Sales Numbers by sidestepping the traditional flow of Finding the Prospect, Selling the Prospect (turning the prospect into a customer), and then upselling the customer for greater profit.

By creating alliances with your customers and with businesses which complement yours, you can tap into their customer bases who are ready to become your customer simply because of your association with a person or business that they already trust.

When you set up a Strategic Marketing Alliance, a letter of endorsement goes out to the established customers of the person or business you have established the alliance with. Your response to this type of mailer is usually much higher than normal, because the introduction is made by someone the prospect already knows and trusts.

Your conversion rate will also be much higher with this type of an approach, because the aspect of trust has already been established. Also, if you treat these customers well (this is a must!), they will have a greater likelihood of maintaining a long term relation with you, thus increasing their value to your company.

Another Strategic Alliance is a marketing alliance with a business which has a similar customer base as yours. This is done by setting up a marketing relationship with a business which is targeting the same prospects that you are.

For example, a dentist might do a joint marketing effort with an orthodontist. Those clients who trust their dentist already are more than likely to follow his recommendation for orthodontic care.

And speaking of dentists, one of the most successful Strategic Marketing Alliances was the alliance between Oral B toothbrushes and almost every dentist in America! Before Oral B, dentists actually gave out candy or other novelties. Oral B’s strategic alliance not only gave dentists something useful and valuable to give away, but also gave Oral B the highest recommendation rate from dentists for any toothbrush. This became part of their USP and their sales skyrocketed.

Developing strong strategic alliances will not only build your business over the short run, but can also set you up for long term success which can’t be obtained any other way.

The computer industry is the prime example of this principle. Strategic alliances between software and hardware companies have launched some small companies into industry leaders simply because they tied their product to another company’s complementary product.

If you analyze any successful large company, you will see that a good percent of its history and growth is paved with carefully structured strategic alliances.

For more information on how to use Strategic Marketing Alliances to  dramatically increase your revenues and profits without spending more money on advertising, contact us today or just call 646-450-4120.