If I had to begin my business again from scratch, I would look at forming strategic alliances and seeking joint venture partners much sooner in my business growth plan.
Asking a more successful business owner to help you promote your site or to form an alliance where you both benefit is one of the quickest ways to turbocharge your success, provided it's done correctly.
However, therein lays the problem. Most joint venture requests are made with absolutely no planning and no forethought. Since I've had an online business for many years, I get emails every week requesting me to promote or joint partner with someone in some way. Almost all of the requests are immediately deleted because the person making the request has simply not done his/her homework and presents me with, at best, a very ill-conceived plan.
There are a few simple steps you should take BEFORE seeking out any joint venture partners or strategic alliances.
1. Product ties into your target market. I'm always getting joint venture requests from people who have products that make absolutely no sense for me to promote. The most mismatched request I've gotten for a JV is with a portable shuffleboard game business owner. No one has joined my list to hear about the latest in any type of game, and undoubtedly my list members would wonder what crazy pill I'd taken the day I send out an email to tell them about this product. It's a complete mismatch for my list.
However, the promoter of this game just didn't get it. He continued to insist that my list would benefit because everyone needs relaxation time, and this game would provide that. Wrong, wrong, wrong. His interest in the JV was due to the fact that I have a large list. A large list doesn't matter if it contains the wrong target market. For successful joint ventures, approach businesses that serve the same target market as you and who sell similar products.
And it never stops. This week someone emailed me wanting me to help them promote their retirement guide, and another wanted me to post articles on my site regarding crafting. I told them both that they needed to improve their research, as neither of those topics was a good fit for my audience.
2. Reliable tracking software. A second way to get shot down immediately in your joint venture partner request is to tell your prospect, "Oh, I'll manually track your affiliates when they write your name in the 'referred by' box on my order form." Yeah, right. That NEVER works. The only way I'll joint venture with anyone is if they are using reliable affiliate tracking software that provides me with a unique affiliate link that I can use throughout any web pages I create or emails I might send, as well as permits me to check on my affiliate commission sales at any time.
Many shopping carts offer this feature, such as the cart I use, Thrivecart. To successfully make a joint venture request, offer your JV partner the ability to reliably track his/her success with the joint venture.
3. Worthwhile commissions. "I'll offer you $2 in commission for every sale that you make!" While this JV requester thinks this proposal should make me stop in my tracks and hang onto his every word, a proposal this inconsequential just isn't worth my time. Your product has to be priced high enough that the commission option will be worthwhile for your JV partner to promote. To determine what this might be, take a look at potential JV partner sites. At what price ranges are their products offered? What commissions are they offering to their affiliates?
I was on a webinar recently with a well-known Internet marketer who said he wouldn't even consider a JV partnership unless he received around $1000 per sale. In this case, the JV requester's product will need to be priced at least $2000 in order to award commissions of that magnitude. Can you play at the level at which you're making your requests? A good JV partnership is born when the requester and the partner offer similarly priced products and similar commission structures. Make it worthwhile for your JV partners to promote your product.
4. Conversion rates. The worst thing you can do is say, "I don't know," when your JV partner asks you the question, "What is the conversion ratio of your sales letter?" Your JV partner has no desire to be your guinea pig and test the success of your sales letter for you. You need to know your conversion numbers before approaching anyone with a JV partnership offer.
This means that you should know that out of X number of visits to your site, Y number buys your product, i.e. 1 out of every 100 or 50 out of every 3000. The higher your conversion rate, the more likely someone will accept your offer to a joint venture.
If you don't know the conversion number, try some pay-per-click advertising or start first with JV partners with smaller lists. This will allow you to tweak and improve your sales letter page and thus increase your conversion ratio to better prepare you to make requests to more powerful JV partners. Check out this article for help with your conversion rates, What is Conversion Rate? How to Calculate and Improve Your Conversion Rate.
Joint venture partners are a very effective way to rapidly increase your sales and grow your business. Do your homework and get your plan in place now so that you can add this strategy to your marketing arsenal.
Creating joint venture partners is one of the best ways to build a business. It’s also one of the best ways to generate new prospects to your website. Contact us today to learn more about how we can help you create a joint venture for your business, or schedule a Brainstorming with Donna session to explore the best options for you.
I help seasoned small business owners create marketing ideas and strategies that raise their visibility, broaden their reach, and grow their revenues.
As a business owner with 24 years of experience, I am the cure for you if you have run out of marketing creativity. I have a unique ability to sense or see the underlying scheme of things, whether it's like a blueprint to build something or an x-ray that shows hidden connections, and connect the dots at a deeper level. I make it really Easy. Enjoyable. Effective. Just like your marketing will be.