As is often the case where I work (the Bay Area), I hear about “brand partnerships” all the time. Some — like Starbucks’ recent partnership with Square — you may already be familiar with. And others? Well, they’re still twinkles in a startup CEO’s eye.
Why are brand partnerships important? They involve a mutually beneficial exchange. For example, one company (Square) brings functionality to the table, while another (Starbucks) brings visibility. If you’re a newer startup, then chances are, you’d love,love a pitch meeting with a big fish like Starbucks. But corporate titans like those are getting pitched all the time. Is there a shortcut to inking a deal with one of them?
Unfortunately, no. There’s no shortcut. But, let’s assume that your company really does possess a functional asset. How do you find your brand “match?” Based on experience, there are four essentials you need to get a pitch meeting and score your dream brand partnership:
1. Identify complimentary — not identical — strengths. You’re going after a partnership, not a merger. So don’t emphasize the ways your companies are alike, but the ways you can help each other.
Let me give you an example. I lead a company called AppMedicine, which provides asynchronous electronic visits between healthcare providers and their patients (functionality!). We wanted to partner with an existing brand with an established user base (visibility!). So we teamed up with drchrono, the go-to Electronic Medical Record platform for doctors, and the results have been fantastic. Our clients get integrated health records, and their clients can offer “e-visits” with patients, making their practices more efficient and cost-effective.
A more delicious partnership is Betty Crocker, who includes Hershey’s chocolate syrup in their brownie mix, and Kellogg’s Pop-Tarts, who rely on Smuckers’ fruit for fillings. There’s also Dell Computers with their internal Intel Processors — but, I hope you won’t bite into any of that.
The takeaway: At your pitch meeting, identify a need. Then, explain to your prospective partner how you can meet it.
2. Explicitly lay out the “win win’s.” Your deal — whether official or proposed — has to be structured in such a way that it’s a true partnership.
We’ve talked about Starbucks and Square and Dell and Intel. Facebook and Spotify serves as another example: Spotify benefited early on from Facebook’s gigantic user base, and Facebook secured new music streaming functionality. But unlike other companies that have been purchased by Facebook — think the $1 billion acquisition of Instagram — Spotify remains its own, independent entity.
This is similar to the point above in that you’re identifying each other’s strengths. But in this step, you’ll need to hard numbers. How many more users will be reached? How much faster will your product run? How many new leads will you generate?
The takeaway: Lay out goals and targets for your partnership.
3. State how your respective customers benefit. A “customer first” mentality is essential to any brand partnership. So think in terms of everyday experience, and illustrate that to your prospective partner.
Fitness wearables are having a moment right now, so let’s look at a couple of great partnerships there. Adidas and Polar Electro created Project Fusion, which integrates heart rate monitors, as well as speed and distance monitoring equipment, into sports apparel. Not only is there a perfect functionality/visibility marriage here, but their respective customer bases get an astounding benefit from buying this new, high-tech clothing. Similarly, Nike and Apple — who admittedly have zero problems in the visibility department — teamed up to create The Sports Kit, a wireless system that allows Nike shoes to “talk” to an iPod, which reports to you how many calories you’ve burn and distance you’ve covered. And what fitness enthusiast doesn’t love that kind of personalized motivation?
The takeaway: Put yourself in your customer’s shoes and ask how, together, your companies can make their lives better.
4. Like each other. Easier said than done, right? But seriously: your teams need good chemistry.
Maybe it’s old-fashioned, but I’m a big believer in bringing teams physically together. This goes both for pitch meetings, and for meetings beyond that initial getting-to-know-you session. Although most of your communications will be conducted by email, phone, and video conference, it pays to get people in the same room. Establishing an ease and trust early on in your budding partnership is crucial, and many (not all — but many) conflicts can be avoided if folks have met one another. Whether you’re sharing leads or co-branding, you’ll want to keep the channels of communication open to avoid snags as your partnership (inevitably) evolves.
The takeaway: yes, it’s more time-consuming, but step away from the Skype call! Get everybody physically present for a few meetings, and let the good ideas flow.
The rest of the article can be read here.