In Oxford’s definition, a joint venture is defined by a commercial enterprise undertaken jointly by two or more parties that otherwise retain their distinct identities.
For a marketing type joint venture, it is an agreement between two companies in which both organisations combine marketing strategies in order to increase their share of the marketplace and increase their revenues.
Here’s a scenario of a venture discussion at a recent event that I am presenting in Asia Financial Forum Hong Kong (where I worked with a business owner to sell his/her own business, in return for this work, I am enabled to get exposure of my services.
Joint Venture Marketing Examples
There are various joint venture marketing strategies businesses could leverage to help grow their business and online presence. Two examples include:
- Email Joint Venture: businesses could introduce and recommend their partner’s products or services to their own email databases. This would be reciprocated by both parties and help generate business interest and purchases quickly. This strategy works well for companies with a short sales process (i.e. eCommerce sites) and can include arrangements such as equal profit share agreed in advance.
- Content Marketing Joint Venture: businesses with active blogs and social media strategies can leverage each other’s online assets to increase their scope and reach online.
For a JV to work properly, the value of “Mutual benefit” must be a priority every time over “Profit Share”, ‘Profit Share’ is too risky, very easy for a competitor to replace you.
JV Objectives would be helpful for a business in the following context.
- Gain access to JV Customer
- Build a long-term relationship with JV
- Additional sales
JV Questions to Ask to Identify Suitable JV Partner
- Who is our ideal Customer?
- Who already has our ideal customers trust, does not compete with us, and can complement our product
- Can we create a persuasive Win / Win / Win solution? As to reduce the ambiguity of this win/win, it cannot be something like the relationship of product owner and an affiliate of the product alone (unless if it complements a tremendous add on value to the affiliate and new channel distribution which the product owner never reaches out too.
7 Steps to a successful JV
|1||Identify Your Ideal Customer – Who are the people who can most benefit from what you are offering?|
|2||Identify their interests / Who do they trust today with their money? Identifying their commercial, social, sporting recreation and leisure interests.Potential JV partners: Accountants, Advertising Companies, Car Dealerships, Clothing Stores, Florists, Gymnasiums, Masseuse, Nail Technicians, Naturopaths, Printers, Real Estate Agents, Restaurants, Solicitors, MechanicsCreate a list of 20 to 50 potential JV partner|
|3||Create a persuasive Win / Win / Win Offer. It must be something which makes people go: Hell yes! I am!|
|4||Meet face to face or via phone call (2nd solution). This preferably face to face as to adjust each other’s respective concern and also a clear outcome. Examples of clear outcome are that ie you want a meeting to explain what you have in mind|
|5||Agree on a mutual to-do list|
|6||Agree on a timeline. Anything that goes beyond 14 days will teach each other commitment on a deal. The only caveat around this is a long public holiday as some period like Christmas, Chinese New Year where the holiday is more than 7 days|
|7||Action time. You!! – Need to gently get this happening. Do not rely on your JV partner|
Keep in mind for an effective joint venture, the steps to do and don’t is to be noticed. So, do follow the steps, as this is generally a workable path to achieving path 1 to 7 and do be patient if some steps are longer than the result. But don’t ever change something unnecessarily (especially when it works). Don’t use direct money as an incentive to change the situation and don’t go beyond 14 days of implementation.