Joint Ventures: Money for Nothin’ and the Checks for Free.

    March 26, 2004

Ever wanted to form one of those nifty “Joint Venture” things?

One of the most powerful marketing techniques around is to form an alliance with another company.

A few types of joint ventures:

  • Swapping space – Do you have a place where I could advertise in your store?
  • Sponsored joint products – Could you design a product that sold both of your products?
  • Sharing referrals – Actively passing on interested clients
  • Passing out business cards – Passively distributing marketing material
  • Shared marketing campaign – Both businesses share in the cost and reap the benefits.
  • Customer list exchanges
    (Being careful of CAN SPAM provisions)
  • A joint newsletter (A 2 page free newsletter can be very powerful)
  • One of the trickiest things to do is find a business that would benefit from an alliance, but not be hurt by your competition.

    To find these businesses ask yourself some of these questions:

  • People that buy from us also buy from whom?
  • What other things do people that buy from us also like to buy?
  • What kind of problems does my product or service help to solve?
  • What kind of products or services tend to create these problems?
  • Do the people that buy from me have anything else in common?
  • Does my product help people accomplish things that require also might require another product or serve?
  • Can I slide up or down the product chain?
  • Example:

    Lets say you sold gardening tools. You wouldn’t want to approach other gardening tool makers, as they’re in direct competition with you. Instead, you might want to approach landscapers, professional gardeners, sod companies, fertilizer producers, etc.

    Also, realize that your product is just a chain in a link of products. Again, if you sold gardening tools… the people that buy them obviously need additional things to get their garden up and running.

    On the bottom of the product chain they need land to garden on. They need equipment to get the ground ready.

    On the higher end of the product chain, if they like to garden then they probably read about gardening or belong to a gardening group. Maybe they read about gardening online.

    Sliding up even further up the chain, they’re probably going to do something with the things they grow. Do they like to grow herbs vegetables? Do they like to cook? What do they use to cook? Do they collect recipes about cooking with home-grown fruits or veggies?

    Now where?

    Once you’ve found a list of potential companies, use a service like InfoSeek or Switchboard to find companies in your area. Call them up and ask for the owner. Don’t spend your time trying to force them, just make it simple:

    “I’m a local business that sells gardening supplies and am looking to ally with other local, related businesses and am conducting a quick survey.”

  • What kind of alliances have you formed with other businesses in the past?
  • How strong were those alliances?
  • Have you ever been in a joint venture?
  • Given that (how your business relates to theirs) do you think that you customers might be interested in gardening supplies?
  • Would you object to me passing interested customers your way?
  • If I could find a way to make this mutually beneficial, would there be any reason why you couldn’t work with me?
  • What kind of alliance would you like? (Brainstorm on this)
  • Conclusion:

    Of course these lists are far from complete. I just hope I’ve provided enough thought fodder to get your cogs crankin’. Business partnerships can be an extremely profitable win-win situation for both of you. You’re helping others while making money. And isn’t that what business is all about?

    Aaron Colman, helping business make money online.
    Web design, custom PHP scripts, MySQL databases and more.

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