24 Reasons to Form Online Strategic Alliances

Strategic alliances are valuable affiliations or partnerships with similar or complementary businesses. They are not reserved for large corporations. Because of the nature of the web, you can easily link in with like-minded businesses to pool your resources and capture a greater share of the global market. By aligning yourself to carefully selected organisations and sharing your strengths, you can fast track your online success economically.

The success of strategic alliances depends on what each party brings into the relationship e.g. assets, experience and commitment and on what terms and conditions the relationship is defined e.g. joint venture, endorsement or partnership.

Strategic alliances can be useful to extend your product line, add new points of sales and consequently increase your turnover. They can also help you gain more exposure, position your business and enter new markets.

Here’s some of the benefits of strategic alliances…

Product sales and development

1 – Expand your range of products

Offer a wider selection of products by adding those of your strategic alliance partners to your regular offerings without incurring the cost of producing and distributing the goods. In some cases, you simply need to provide a link and direct product enquiries from your customers to your partner’s website. If a sale is made, you receive a referral commission. This type of alliance creates a new source of income.

2 – Cross-sell products

A customer who enjoys your products is more likely to seek and follow your advice for future purchases because you have gained credibility. Recommend the products of your strategic alliance partners and receive a pre-negotiated referral commission on product sales. Because of your trusted recommendation, customers benefit from a shortened purchasing process (no need to research and review) and reduced element of risk in trialling new products.

3 – Supply holistic solutions

Provide ‘complete’ solutions that require bundling your products with those of your strategic alliance partners. This is similar to the one-stop-shop principle where you find all products and services under the roof (in this case a website). Buying a package deal for a fixed price is convenient, quick and relatively easy for the customer to order.

Example: Some web site designers bundle their design services with hosting and domain name purchases. On the one hand, customers benefit from not having to deal with three different entities (web designer, web host and registrar) and having to work out the logistics. And on the other hand, web designers receive a commission on sales of their strategic alliance partners’ products whilst adding value to their own services.

4 – Create products jointly

Develop new products drawing on skills and knowledge of each partner. Shared resources and expertise will gain lead time, reduce product development costs and may also widen the appeal of your product.

5 – Develop new applications

Tailor products from your strategic alliance partners to meet the needs of your own market and likewise, your partners can find new uses or applications for your products.

Example: My book ‘200 Marketing Ideas for Your Website’ has found a new lease of life with one of my strategic alliance partners. It is now sold as a human resource management tool for recruiting staff and volunteers on the web.

6 – Invite an expert

Form a strategic alliance with an expert in your field who will answer questions from your website visitors. Advertise your products on the sidebar where the answer to the problem is displayed and have the expert recommend your products when appropriate. From this arrangement, the expert can benefit from free publicity for his services and possibly a commission on your product sales.

7 – Increase perceived value

This is a win-win-win situation. By offering a product from a strategic alliance partner as a bonus, you add value to your own product, the customer benefits from a freebie and your strategic alliance partner gets a special introduction. Naturally, this can be a reciprocal arrangement where a strategic alliance partner offers your sample or promotional product.

Example: Give away a half-hour introductory consultation with your partner or a promotional eBook valued at $29 with each sale of your product. All parties benefit from this transaction.

8 – Gain product acceptance and credibility

To increase the attractiveness of your products or services, have a reputable expert in your field endorsing them. As part of the alliance, give a commission on product sales and advertise the expert’s own products and services on your website.

9 – Pre-sell products

Recommend products and services from your strategic alliance partners. When a product receives a favourable mention, as in an article or review, it is usually ‘pre-sold’ to the customer i.e. the customer has already made his mind to buy the product, before the click on the purchasing link to the partner’s website. You may want to produce articles and reviews for your own products that your strategic alliance partners can publish on their websites.

10 -Increase your sales force

Your strategic alliance provides an additional sales force. With more people and more websites to promote your business, your sales should increase.

11 – Develop new distribution channels

Add new points of sales for your products using your strategic alliance partners’ locations to service your customers. This will reassure those customers who are uneasy about purchasing over the web.

12 – Exchange knowledge and products

Save on operational costs by trading products and services for free or discount prices with your strategic alliance partners.

Example: Within the National Speakers Association, we ‘pick each other’s brains’, refer customers and sell each other’s books. This strategy enables us to increase our knowledge base and provide new distribution channels for our products.

Positioning and promotional benefits

13 – Position your business

Strategic alliances position businesses in the minds of customers. That is why your choice of strategic alliance partners is critical in securing your desired business image.

Example: If you are associated with a University, people will perceive that your offerings are supported by scientific evidence and academic ethics. If you are a member of a home-based business association, people will see you as a cottage industry or… one of those professionals who have a great lifestyle!

14 – Trade invitations

A special invitation to your customers for visiting your strategic alliance partners’ website or subscribe to their newsletter can increase your customer base and result in extra sales when reciprocated. Viral marketing, the online word-of-mouth, is more credible and powerful than any expensive banner advertisement.

15 – Exchange testimonials

Reciprocal testimonials serve as endorsements of each other’s businesses. It costs nothing but reassures potential customers in regard to your trustworthiness and expertise. It makes people more receptive to your commercial message.

16 – Swap adverts

Partners of a strategic alliance can save on promotional costs by exchanging website adverts from their business. This a good way to increase traffic to their sites at no cost.

17 – Increase search engine visibility

An increased number of inbound links (links towards your website) will boost your search engine ranking. One of the factors that determines ranking on search page results is link popularity, which is based on the number and quality of inbound links. Reciprocal links from strategic alliance partners will increase search engine ranking for all concerned.

18 – Cross-promote your businesses

You can pool financial resources to maximise your promotional efforts.

How the Rainforest Alliance is Impacting Our World

In today’s growing climate of environmental sustainability awareness and the recent upsurge in green products and earth friendly consumers, it seems like organizations doing good things for the world are a dime a dozen. The Rainforest Alliance is a lot of things, but it’s certainly not one of the hundreds of organizations that are riding the wave of the public’s ever fickle favor. Founded more than twenty years ago, the Rainforest Alliance works hard to conserve biodiversity, encourage sustainable livelihood, and reform business practice and consumer behaviors through robust education networks and tireless campaigns.

The Rainforest Alliance approaches the challenges of environmental sustainability from a lot of angles, profoundly impacting all sides of the production and consumption chain. Their programs and strategic alliances are diverse and effective.

Sustainable forestry

Just three years after their inception in 1989, the Rainforest Alliance founded the world’s first sustainable forestry certification program. SmartWood, as the program is called, certifies forestry operations that meet strict environmental and social standards which ensure sustainable practices and safe, fair workplace standards. Forestry operations which meet the SmartWood program’s standards are awarded the ability to include the program’s seal on their products to help consumers make responsible decisions when purchasing lumber or other forestry related products. The Rainforest Alliance’s forestry program isn’t just talk, either. In fact, Greenpeace, a well known global environmental organisation, ranked the SmartWood program as the “top of the class” in a report entitled “Wood Products Legality Verification Systems: An Assessment.”

Sustainable agriculture

There are similarly strict guidelines to the certification of tropical crop producing farms. To obtain certification coffee, banana, cocoa, orange and tea plantations, among other farming operations must adhere to specific regulations reducing the use of harmful chemicals, improving ecosystem conservation, and protecting the rights and health of the plantation workers. The results of tropical farm certifications are impressive. Between 1994 and 2000, for example, the Rainforest Alliance worked with Chequita, one of the world’s largest banana exporters, to certify all of its Latin American banana farms. This huge effort cost Chequita some $20 million and drastically improved the environmental sustainability and social responsibility of its banana farming operations.

Sustainable tourism

The Rainforest Alliance also works with existing certification programs to improve environmental sustainability in small and medium sized tourism businesses throughout Latin America. Through training and education programs, strategic partnerships with businesses in all aspects of the tourism trade, and an ongoing, determined promotion of existing certification initiatives, the organization strives to promote social and environmental best practice through a variety of veins. Their efforts have been so successful that in 2008 the Discovery Channel noted that the Rainforest Alliance’s efforts are “…possibly leading to a world-wide standard for what ecotourism ought to achieve.”

Partners that matter

One of the most powerful strategies of the Rainforest Alliance is the persuasion of huge public facing organisations to put more value in sustainable business practice by demonstrating the environmental and social value in revamping policies and re-organizing supply chains. With benchmarks like Unilever agreeing to certify all of its Lipton Tea plantations by 2015, JP Morgan, Citigroup and Nike printing their annual social responsibility reports on certified paper, and many McDonalds locations switching to certified coffee beans, the leaps and bounds of progress are strikingly clear.

With programs improving farming, forestry, and tourism environmental and social responsibility in more than sixty countries worldwide, it’s no wonder the Rainforest Alliance’s reputation is so impressive.

Hugh McInnes