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The Power and Profit of Affiliate and Joint Venture Partnerships

Guest post by: Kathleen Gage

Article Overview: In offline marketing terms such as sponsorships, partnerships and shared revenues were used to define what is now referred to in the online world as Affiliate Partnerships and Joint Venture Partnerships.

The Power and Profit of Affiliate and Joint Venture Partnerships

Many people marketing with the Internet are utilizing a couple of very effective strategies to increase revenues and market reach. Newer marketers may believe these tactics are brand new and are some great “secret” recently revealed. Anyone who has been in marketing for any length of time knows these strategies have been used for years in offline marketing. When utilized correctly they have been extremely effective in lowering marketing costs while increasing market reach and ultimately revenues.

In offline marketing terms such as sponsorships, partnerships and shared revenues were used to define what is now referred to in the online world as Affiliate Partnerships and Joint Venture Partnerships.

Both online and offline partnerships have incredible benefits and the potential for unbelievable market reach when done right. They can also have incredible pitfalls when they are not well thought out and can cause havoc to one’s market almost instantaneously if not properly planned.

Affiliate Partnership
In this type of partnership, someone else (the affiliate) helps to sell your product or service and receives a percentage of that sale based on performance. The affiliate markets to their customers and clients. Common items to sell would be software programs, eProducts, and seminar registrations. This type of partnership allows for increased revenue streams while providing added value to existing clients by offering products and/or services that would be beneficial to them.

One challenge with online affiliate partnerships is the inexperienced marketer who is encouraging people to buy something they have not tried, know nothing about and are basically trying to make a quick buck. For an affiliate partnership to be most effective, research what is being promoted and only offer items that are a good match for the market being targeted.

Considerations in choosing affiliate partnerships are:

* How credible is the product or service?
* How long has it been on the market?
* Is the market saturated with other people selling the item?
* Is there a large enough market?
* What is your percentage of the sale?
* How and when are payments made?
* What is the reputation of the person you will be selling the product or service for?

Joint Venture Partnership
The primary purpose of this partnership is cross promotion with the goal of one company selling a product/service while increasing market reach and database size for all partners. A Joint Venture partner (JV) agrees to send out a message to their market about the company or product that Company A is promoting. In return for promoting Company A’s product or service to their market, the JV is able to offer some type of incentive to Company A’s customer base. This incentive will drive anyone who purchases Company A’s product or service to the JV’s company. The incentive could be a free item or a discount on an item. Ideally, the incentive offer is free.

Assume you are spearheading just such a partnership. Let’s say you secure partnerships with ten JV’s who each have a market reach of 100,000 and you have a market reach of 100,000. With the right partners your market reach will have gone less than 10% of what you would have had to over 1,000,000.

An essential element of success in JV partnerships is that everyone involved does what they agree to do. With a well-organized partnership where everyone follows through on their part, you can reap incredible benefits. If not, you can have a huge headache to deal with, let alone what it could do to your company’s reputation.

In a perfect world these types of partnerships would be hassle-free. In reality, there are areas of consideration, such as:

* What is the reputation of your potential partners?
* Will they follow through?
* What is the quality of the incentives they are offering?
* Is the market you are targeting oversaturated with these types of partnerships?

Affiliate and Joint Venture campaigns may be one of the best business and marketing decisions you can make or they may not be a good fit at all. Make your decision based on the overall objectives of your organization. By doing your homework you will be able to determine if this is a good fit for your business model. In some cases it is a great match, in other cases you may decide to walk away.

Related Articles
  Joint Venture Power
  Funding Resources
  Collaboration Rather Than Competition – The Need for Wise Partnerships is Higher than Ever
  Why I Avoid Partnerships and Prefer Joint Ventures.
  Top 10 Tips To Having A Successful Joint Venture

Article Tags: authors, book marketing, internet marketing, making money on the internet, online business, online marketing
Referred by: http://www.sandcconsulting.com



Related Forum Posts
Re: [JOINT VENTURE] Want FREE Staff? Want to Scale Up Massively? - Hi Alan, Welcome to the forum! [quote="Joint Venture":2bfdqwzb]Total transparency is a must when JVing with someone.[/quote:2bfdqwzb] What about when inviting people to send you their proposals...? Cheers, David H
Re: Traffic! How do you get it? - Hi Mal, Thanks for pointing out that Linkdirectorysubmitter is included in the Affiliate Power Group membership package. It's very easy to overlook freebies, even the useful ones. I'll go and check it out.
Re: Alexa Ranking Goals - Well done GT for achieving your Alexa goal for Affiliate Power Central. Alan Mater has done very well with his site's ranking too. I managed to get my site, grasp-the-nettle.com, below 200,000 for a brief while, but took my foot of the gas... Hope to rebuild momentum in the next 2-3 months!
Different types of funding - Business Relationship Funding This is another source of funds that can be overlooked. It may be possible to introduce potential alliances to add value to both parties. It may produce an ultimate exit route in the medium to long term. Joint Ventures: Requires a legal agreement embodying the deal and another company Partnerships: Two companies collaborate with possible funding. Joint working relationships: These are an informal partnership which may be more project specific where the parties can share resources. Agencies: These can be geographical or product specific and generally incorporates a payment for the right to the agency. Distributors: Very like an agency but may not necessarily involve up front payment. Alliances: These do not require a separate company and can be embodied by a legal agreement to work together. Trade investors: Otherwise known as Corporate Partnering. This can be a good way to involve a much larger company in the business with a view to possible trade sale further down the line. Associates: This can be a loose arrangement with no fundamental commitments either way, rather like a preferred supplier. Equity Swop: Two companies exchange shares to a similar value to develop both businesses. Franchises: This can allow the business to grow without further direct investment. Licensing: This involves licensing a product or service to enable others to sell it. This requires you to own the intellectual property.
Don't leave your Wallet on the table - Targetzone, Evan has great points on targeting you package. Also I read the revenue model you mentioned and i believe you are leaving a lot of money on the table. Aisde from making just $15/sale of a package you could also be making income from sales generated after the people use the coupon on their second and ongoing visits to the Service/Product company. I've sent you a PM - We can talk more advanced strategies. BTW - I'm a Dollarmakers Member and have taken the Joint Venture BootCamp 101 and highly recommend it if you wish to pursue this idea. PM me privately and we can talk.


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