Increase Market Control with Strategic Alliances
Strategic alliances maneuver your business toward increased sales and greater brand awareness in the market. Navigating these arrangements with complementary businesses can be difficult, however, they are quintessential in the strategic process.
Defining an Alliance
An alliance is a type of partnership with similar businesses that can create mutually beneficial gains in the long or short term goals of your business. Normally these companies have comparable visions, market interests or objectives for expansion that they can work in unison to achieve.
- Formal
- Informal
- No Capital Invested
- Capital Invested (contract)
Typically, strategic alliances (in the domain of marketing) are less formal than a joint venture. Although capital can be involved, typically the costs of participating in an informal alliance entail less risk. Alliances can be formal or informal and may not even have a contract. Whether the alliance is formal or informal. Below are factors you should consider when entering into such an alliance with a business partner.
Unified Vision
Before you enter into an alliance with a similar company, consider the values, goals, and objectives of that company. Is the brand of your partner’s business similar enough to achieve the objective that you desire?
An alliance is traditionally defined as a:
“…mutual recognition and understanding that the success of each firm depends in part on the other firm….”.
Before you enter into circumstances where your businesses would be associated with one another, consider how that could affect the reputation of your company.
Formal or Informal Agreement?
Although alliances are typically less formal and less binding than joint ventures, there should still be a mutual understanding of the activity companies in which companies are engaging.
For example, let’s say a logistics company partners with a business that builds barcode scanners. The logistics company desires to increase profits through the partnership and the barcode company wants to increase sales of a specific product. For this alliance example to be properly executed, it might benefit these companies to have a formal agreement. Especially where profit is concerned or capital is invested, it is wise to write a formal agreement.
Where capital or financial investment is involved there should always be a formal contract that negotiates the parameters of your alliance. Before you consider pooling resources with another business to achieve an objective, clearly state the objective of both parties.
Outside the Box
The enemy of your enemy is your friend. The competitor of your competitor is your business partner.
When it comes to establishing alliances, think creatively. Go outside the box of orthodoxy in business practices. Certain alliances that you would never imagine to be even possible will evolve into fruitful relationships that grow your business exponentially.
If you are a Healthcare IT company struggling to face a competitor, look for other businesses in the industry that are also struggling to combat that competitor. It is likely that you will discover an unexpected business partner or alliance on the horizon.
- Build technology
- Raise Investments
- Expand Markets
- Grow Audience
- Move Beyond Niche Focus
Whether establishing a new alliance or reviving an old one, consider Robotic Marketer for your strategic marketing process. Our AI-based software will design a marketing strategy for your business in only a matter of hours. Soon you’ll be delivered a marketing plan ready to be implemented and executed, complete with recommendations of alliances to join.
