Strategic Alliances for Cross-Promotion
A popular reason for companies to come together is to reciprocally promote one another. Ideas are as simple as a local pharmacy and dry cleaner promoting each other with specials or coupons, to regional promotions, to national promotions. Cross-promotions can be developed with competitors or between organizations from different industries. The key is simply this—do you have similar customers? Almost everywhere you look, you can see one organization cross promoting with another. Recently, a cross-promotion advertisement in a San Francisco newspaper for Pacific Bell also involved Round Table Pizza, Hollywood Video, Nokia and the Special Olympics.
In your effort to make cross-promotion alliances work, develop your process by keeping the below listed steps in mind:
- Be clear on what you want to create for yourself or your company.
- Discover the; What’s in it for me (WIIFM) for your partner(s).
- Develop a list of who does what for physical and financial contributions.
- Plan for the unexpected.
- Explain to your partner(s) the value they will receive.
- Help your partner(s) to have an emotional ownership in the alliance.
- Do the above step for yourself also.
- Execute the promotion.
- Debrief with partner(s) the value received from the investment.
- Plan the next promotion.
“Got Milk?” The California Milk Processors Board, as reported in The Wall Street Journal, January 24, 1997, has been running that national promotion since 1993. They also put “Got Milk” on Girl Scout Cookies. They have even gotten their milk advertisements on cereal, cookies and chocolate mix packaging. Jeff Manning, executive director of the California Milk Processors Board, says, “We need those people to promote for us.” “In return, we affectionately call them co-dependent foods.”
Manning doesn’t stop there. He convinced Dole Food Co. in Westlake Village, California to add another sticker on to their clusters of bananas for the retail market. You got it, “Got Milk” stickers. In 1997 Dole put “Got Milk” stickers on a million bunches of bananas. Milk is getting more interruptions in the minds of consumers. The more Partnering milk can do with products in other parts of the grocery stores, the more sales potential they enjoy. Dole even got an “ah ha” from the cross-promotion, they have been Partnering with Hollywood to promote new release movies such as Anastasia and Babe in the City.
Researching for a presentation for the National Home Furnishings Association, I discovered an interesting alliance in Northern California. They call themselves the Sonoma County Fine Furniture Association (SCFFA). What did they do? Eight fine furniture retailers, competitors, banded together to survive the recession of the early 1990s through cross-promotion and buying strength.
They bought advertising together on the local radio and in the local newspaper. They even dictated to the newspaper on which pages their advertising would be located. They developed combined events where customers would visit several of the stores to be eligible to win prizes. They promoted each other to their customers within the store, especially if the specific retailer did not have exactly what the customer was seeking. They even printed a combined brochure, including the address and map locations of each member. The front of the brochure said, People you can trust. Wow, what impact!
On a United Airlines flight from Washington, D.C. to Atlanta, the cabin attendant handed me my usual bag of peanuts. But, what was unusual was the size of the bag and its weight. After closer examination, I noticed that an America Online (AOL) diskette was included with the peanuts. It made sense, a business route shuttle—what a great way to get the AOL software into the hands of business people.
Forest City, Iowa, recreational vehicle (RV) manufacturer, Winnebago Industries, Inc. (www.winnebagoind.com) with sales of $665 million in 1999 and Nebraska-based sportsman’s outfitter, Cabela’s have found synergies through reciprocal promotion activities. Cabala’s has provided an ideal venue in which Winnebago dealers have displayed their RVs in more than 30 outdoor events in 1999. Most, run by Cabela’s promotional arm, Sportsman’s Quest. Winnebago products were also displayed in Cabela’s catalogs. Winnebago, in turn displayed Cabela’s products at their events.
Strategic Alliances for Co-Branding
Bringing together more than one trusted and established brand name develop a marketing synergism that cannot be beat. The advertisement headline read, Bring The Magic of Mattel Home for the Holidays. Just under the headline were several foods producing toys offered. The hook was that it showed Golden Arches type food. Mattel had a relationship with McDonald’s. And, what quality parent would deny their child the opportunity to make their own McDonald’s hamburgers, fries, shakes and cookies at home?
Nestlé/Road Gold Flipz (chocolate covered pretzels), the synergy that can be developed by co-branding is awesome. Co-branded products have, at a minimum; twice the marketing impact and customer pull as traditional branding. Consumers believe that with two trusted names, the product must be exceptional. There was one problem with the Flip though. When they were first introduced, the consumers’ acceptance was so great that the distributors had trouble keeping their stores in stock. What a problem to have . . .
In recent years the automotive industry has found value in Partnering with highly recognizable prestigious brands of clothing and accessories. Ford Motor Company partners with the successful catalog retailer, Eddie Bauer to offer luxurious editions of their popular sport utility vehicle models, Explorer and Expedition. As customers’ perception of quality and value can be influenced through these offerings, they are also willing to pay more for the perceived value.
Ford Motor Company states, in a June 29, 1999 Ford news release, its pleasure with its Eddie Bauer relationship in a news release. “Two of America’s most enduring brands reached a milestone today in their 17-year collaboration as Ford and Eddie Bauer celebrated production of the one millionth Eddie Bauer edition Ford vehicle at the St. Louis Assembly Plant, home of the Ford Explorer sport utility.”
“It’s almost uncanny how well-matched Ford and Eddie Bauer are,” says Ford Division Marketing Communications Manager Jan Klug. “Both companies have reputations built on an uncompromising commitment to quality, durability and customer satisfaction. For our customers, this means the irresistible combination of Ford’s ‘go anywhere’ capability and Eddie Bauer’s rugged style. For both companies, it means enhancing each other’s brand.”
“It’s no secret why Ford is setting industry records for SUV sales in a U.S. market that currently has 41 SUV nameplates,” says Explorer Brand Manager Doug Scott. “We are creating products that really excite the customer. And in partnering with Eddie Bauer, we are expanding the opportunities for the Explorer and Expedition to be a meaningful part of our customer’s active lifestyles.”
Because of Ford’s success in co-brand Partnering with Eddie Bauer, they are trying to duplicate their success with Harley-Davidson Motor Company, Milwaukee, Wisconsin in their limited edition Harley-Davidson F-150 pickup truck. The customized version is restyled, all-black, with distinctive Harley-Davidson orange pinstriping and chrome accessories.
“A strategic alliance between the Ford Motor Company and Harley-Davidson makes mutual historical and business sense,” noted Gurminder Bedi, vice president, Ford Truck Vehicle Center in a January 6, 2000 Ford news release. “Our common heritage as American motor vehicle manufacturers and our common centennials of 2003 were just too good to pass up as a natural business opportunity. “The partnership makes good business sense,” Bedi added. “The world recognizes both companies as original American innovators known for exciting, quality products.”
“This alliance brings together two of the most well-known and admired companies in the world,” said Jeff Bleustein in the same release, Harley-Davidson chairman and chief executive officer. “Ford and Harley-Davidson customers alike want a distinctive vehicle that makes a statement about themselves as individuals.”
Even in the recreational vehicle (RV) industry, a manufacturer sees marketing value in co-branding. Fleetwood Enterprises, Inc. in Riverside, California with $3.5 billion in sales in 1999, is in alliance with Bass Pro Shops Outdoor World. Fleetwood has enjoyed good sales volume in its private-label RV partnership with Missouri-based Tracker Marine LP and its Bass Pro Shops Outdoor World stores. Fleetwood built and branded with the Tracker and Trailstar name are sold in six Bass Pro Shops Outdoor World stores and 56 Tracker marine dealerships. RVs promoted at the Outdoor World stores sell for a single, non-negotiable price (unique to the RV industry) and can be purchased over the Internet. Models range from a Trailstar 8 folding trailer to the 29-foot Class C Trailstar RV.
Ed is the Founder and CEO of the 501(c)(3) non-profit public charity, Cigar PEG Philanthropy through Fun, and president at Rigsbee Research which conducts qualitative member ROI research and consulting for associations and societies. He has been called “the dynamite that broke up our log jam” by association executives—rarely politically correct and almost always provocative—and from a dozen years as a United States Soccer Federation referee, Ed calls it the way he sees it. Exceptional resources at www.rigsbee.com.
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