‘I love creating alliances, I love not having to carry the full weight of creative storytelling..’ -Steven Spielberg
Instead of trying to do everything alone, strategic partnerships can be an effective way to build business. As each partner leverages the other’s assets, it can expand or penetrate deeper into existing and targeted product markets, compete in new markets, gain access to new distribution channels, benefit from positive brand images, or fine-tune new business models. . Partnerships are especially valuable for companies seeking quick entry into a particular market or line of business due to technological disruption, new market entrants, or aggressive moves by competitors.
Not surprisingly, they can take various shades of gray, from joint ventures to looser alliances, and often have a specific focus:
– Strategic Marketing Partnerships Enable companies with a good match (eg, target audience, brand/value perceptions, etc.) to enhance their brand image and increase awareness in a cost-effective and synergistic manner by combining two brand budgets and outlets .
For example, the partnership between Christian Dior Fusion Sneakers and Colette gave Christian Dior the opportunity to launch its new modern, innovative and luxurious line (a fusion between traditional sneakers and Dior couture shoes) in the exclusive and prestigious network Colette distribution. For Colette, being chosen as the store where the sneakers first appeared generated great PR for the trend-setting retailer.
If the partners are in different parts of the same market, customers can recommend each other and the partners can expand beyond their respective customer base, as illustrated by H&M’s ongoing collaboration with couture designers such as Karl Lagerfeld, Lanvin or Alexander Wang. This allows H&M to offer high-end fashion branded items for a limited period of time to attract people to its stores and support its brand’s positioning as a trendy fashion destination. Haute couture designers increase awareness of their own brand and forge a bond with a new generation of potential customers, who will hopefully aspire to own more pieces from their high-end collection.
This can also take place in different product markets, such as the partnership between high-end camera company Leica and luxury fashion brand Moncler. The limited-edition “fashion” camera is the ideal purchase perfect for both the high-end target audience and to reflect the camera owners’ sense of aesthetics.
– Strategic Supplier Partnerships may include manufacturers, distributors, or vendors. Provide security of supply (including new products tailored to specific needs) and may result in special discounts and lower prices; a classic example is Apple and Google working with many small app developers to create an ecosystem of mobile services.
Such a relationship can sometimes lead to schizophrenia. Apple’s main supplier of microchips for its iPhones is Samsung, its main rival in the smartphone market. They compete aggressively in the marketplace while collaborating closely on the design of the semiconductors that Samsung sells to Apple.
Strategic supplier associations can also be created to provide a unique competitive advantage to one of the partners. H&M is collaborating with I:CO, a logistics company, as it has started offering customers the opportunity to bring their old clothes back to its stores and receive a discount on new ones. I:CO sends part of the used clothing to the second-hand market or to be recycled.
– Strategic Technology Partners help companies share the burden of the high costs that are often associated with new technologies. The need to develop electric, hybrid, hydrogen fuel cells and other forms of propulsion, while also investing heavily in their gasoline and diesel engines, has led automakers like Toyota to partner with rival BWM. in the manufacture of fuel cells. technology.
Technology partnerships can also unite companies from different industries, such as Allianz, which has partnered with Google to create an “accelerator” center in Munich, to encourage startups looking to use data analytics to improve the insurance marketplace.
They can also bring together companies that operate in different parts of the technology spectrum, such as the Apple-IBM alliance. Big data analytics from IBM and more than 100,000 industry software developers and sales consultants help Apple penetrate the global corporate business market with a new class of apps to connect users with big data and analytics on devices iOS.
Despite all those successes, making partnership relationships work is often notoriously difficult. They are similar to marriages of convenience, where trust and respect are often tested by underlying rivalries and the occasional spat.
Rules for successful partnerships abound, but the focus must remain on partnering with a company with a similar vision and culture, and on continually building trust through open and transparent working together. In any case, most associations don’t work exactly as expected, so flexibility, as always, is a foundation.