The Right Partnerships Yield Results

Partnerships continue to be an important tool for deepening customer loyalty. The right partners give users a reason to engage on a more regular basis with your brand. Thoughtfully chosen partnerships also provide opportunities to align with industry leaders to reach new audiences.

However, success depends on selecting the right tool for each job. Using a sledgehammer when the job calls for a screwdriver won’t get the task accomplished. Embarking on a partnership that is not aligned with your goals will be just as ineffective.

Newer brands often struggle to define a starting point with partnerships, and established brands have to weed through a daunting number of available opportunities. In either case, it is equally important to have a strategy in place to identify the partnerships that will provide the most value to your brand.

Develop a Tiered Approach to Choosing Effective Partnerships

With so many opportunities available—and since time and resources are always a factor—a clear strategy for selecting the best partners to achieve your goals is imperative. Sorting potential partners into short- or long-term opportunities helps you quickly triage and organize—but also lets you consider partnerships with the potential to offer lasting mutual benefits over a longer window of time.

SHORT-TERM FOCUS

• Give It a Gut Check

  Start by establishing clear goals for what you want to achieve with partnerships. In the beginning, you may choose to focus on a single metric. When evaluating a new opportunity, ask yourself one basic question: Does it support the defined goal? If the answer is no, pass. It doesn’t matter how exciting the opportunity is if it won’t help you achieve your goal. You may want to politely decline, candidly explain the reason, and be clear if you would consider partnering in the future.

• Sharpen the Focus

If a partnership opportunity passes the gut check, you then need consistent criteria to further evaluate whether or not it is a tool worth adding to your toolbox. Establish three simple metrics that support your clearly defined goal. Customer reach, member experience, and engagement are good options, but your metrics may differ, depending on your goal. If the partnership doesn’t support at least one of the established criteria, it’s not the right fit.

•  Consider Your Resources

If you determine a partnership opportunity aligns with your defined goals, consider whether you have the resources required to bring it to market. Successful partnerships require support from legal, marketing, finance, data, and technology business partners. If you have the support and resources needed, you can confidently move the partnership forward.

LONG-TERM STRATEGY

Long-term partnerships require more resources overall, including financial, operational, and personnel. So it’s vital to take the time to explore why you want to add partnerships to your loyalty strategy—and anticipate how your partnerships will create additional value for your brand and your most valuable loyalty members.

• Define Your Purpose

A customized partnership workshop can help your team raise and answer important questions about values, criteria, constructs, and categories. Exploring these topics is the start toward creating a personalized approach to partnerships that can increase member engagement and earning and redemption opportunities for your target audience.

Example:

Solving customer pain points and elevating their passions is a great place to start. That was the core of the Marriott Bonvoy and Uber Eats partnership during the height of the pandemic. They encouraged members to “Order now. Go later.” Knowing members were hesitant to take personal trips, and work travel was still very limited, the campaign focused on supporting local restaurants so members could safely explore new food options while continuing to earn points toward future stays. Now, as travel is returning to pre-pandemic levels, this smart partnership continues to support members and their love of travel.

• Assess the Competition

Understanding the competitive landscape is vital to developing your long-term partnership strategy. Would you be the first to market in this space? Or are your competitors already there? Leverage partnerships to differentiate your brand by either bringing a fresh approach to an existing partnership construct in the market or by collaborating with unexpected partners that drive brand innovation or expand the value you’ll deliver to members.

Example:

With a desire to reach a younger customer base, many brands are targeting gamers, leading to innovative partnerships that may not seem immediately intuitive. The National Football League (NFL) set themselves apart by reaching the next generation of football fans through the metaverse with the launch of NFL Tycoon with Roblox, a popular online game platform with a unique user-generated ecosystem. That comes on the heels of another cobranding experiment, a successful slime-filled broadcast of an NFL Wild Card game with Nickelodeon.

• Understand Current Trends

Look outside your industry—and outside the partnerships space—to get a read on what’s new, exciting, curious, or interesting to your members. Really listen to customer feedback: Their insights can help identify ways to leverage unexpected products or innovative services in your loyalty partnership.

Example:

Minimalism and the less-is-more concept took off with Marie Kondo and became mainstream with the proliferation of Buy Nothing groups. In a Walmart consumer survey, 70% of respondents said they didn’t know where to start when it came to organizing their homes. Enter the Walmart and The Home Edit partnership, which delivers beautiful, functional, and accessible organization solutions for the entire home. By listening and learning from customer feedback, Walmart was able to bring a fresh perspective to their partnership mix.

• Define Success

Jointly defining success from the start sets expectations and provides structure to the partnership. What are your success metrics? Can each brand partner provide the needed data to inform these mutually determined KPIs? How often will reporting be shared and analyzed? Establishing these details up front makes clear how to measure progress along the journey together. Further, agreeing on success metrics at the outset keeps both brands focused on delivering the intended value.

Example:

A clearly defined vision of success allowed Hilton and Mars Petcare to deliver an enhanced customer experience with an engaging emotional connection. Hilton’s extended-stay brands—Homewood Suites by Hilton and Home2 Suites by Hilton—partnered with Mars Petcare to bring pet-focused benefits to their guests in the U.S. and Canada. Both brands are now 100% pet-friendly across their portfolio of hotels and have become pet heroes to their guests, who can ask Mars Petcare experts for help with pet health and behavioral questions that may arise during their hotel stay. In this case, KPIs can be tracked by monitoring bookings through partner activity and measuring emotional loyalty through NPS scores.

Keeping your partnership timeline in mind is key to identifying the partners that align with your business goals and shore up your brand purpose in the near future and over the long term.

Whether your brand is just beginning a partnership strategy or has already embarked on a partnership journey, make sure you’re building on a strong foundation by:

• prioritizing clearly defined objectives

• keeping a finger on the pulse of market trends and your competition

• maintaining a strong support team

• tracking KPIs and assessing member engagement

• gathering feedback on an ongoing basis to adjust as needed

Developing your partnership approach with these strategic imperatives in mind will allow your brand to effectively leverage the inherent, compound potential of this valuable tool.

Amy Farsht serves as senior director, partnership marketing for The Lacek Group, a Minneapolis-based data-driven loyalty, experience, and customer engagement agency that has been delivering personalization at scale for its world-class clients for more than 30 years. The Lacek Group is an Ogilvy company.