THE ROLE OF JOINT VENTURES IN MARKETING

 

The term 'joint-venture' , in European law, is an elusive legal concept, better defined under the rules of company law. On the other hand, when two or more persons come together to form a temporary partnership for the purpose of carrying out a particular project, such partnership can also be called a joint venture where the parties are "co-venturers". Most small business owners want to generate huge profits, with little effort and in the least amount of time. If you fall into this category then joint venture marketing is the fastest, easiest and most profitable way to do that. Joint ventures have become more prominent in the world of alternative investments since the financial crisis began in 2007.

Joint venture marketing involves two or more businesses combining their resources to work towards a common goal, and create a win-win situation for all parties involved. It's about partnering with another business to leverage on resources that your small business wouldn't otherwise have. While it appears to be more popular with online businesses, joint venture marketing is still implemented by offline businesses, and it certainly works just as well in the offline world. In fact, one of the reasons why many industry giants like Southwest Airlines are so successful is because they implement joint ventures.

Doing joint ventures has many benefits. We focus on the top seven benefits for small business owners. Here are seven reasons why joint ventures are the most powerful marketing strategy available to any business, and why every small business should be doing joint ventures:

1. You'll increase visibility. You'll be exposed to new markets that you may not have been able to reach on your own. Dominating a niche market is important, but you shouldn't throw business away when it comes from other industries/sectors that can benefit from what you have to offer, even though you may not necessarily target that market. By doing joint ventures you'll easily get introduced potential markets, and this will in turn increase your visibility in the market place.

2. Youll survive any economic climate. It doesn't matter if there is a downturn in the economy or whether the political climate is unstable. But finding an entrepreneur for a joint venture is another task. Nonetheless, there are risk-takers, venture capitalists, angel investors and venture managers (especially in the high-tech industries like IC chips or biotechnology).

3. You'll save time and money. Joint Venture marketing is a very low-cost sometimes even no-cost strategy. This enables you to protect your cash flow. 11 save time on production and save money on operational costs by offering clients new products and services (from your joint venture partner) that you didn't need to create yourself. You'll also slash marketing and advertising costs by sharing these costs with your joint venture partner.

4. You'll pay for results only. When you place an ad or you rent names for a direct mail campaign, you still pay the publication or list broker, whether you generate responses or not. With joint ventures, you only give your joint venture partner a cut of the profits based on the sales made as a result of the joint If no sale is made then your joint venture partner gets nothing. That eliminates potential losses.

5. You'll build long lasting business relationships. Through wise endorsements, you'll strengthen relationships with your clients and increase your network of business associates. This is great for future joint ventures, getting testimonials and other marketing opportunities.

6. You'll be adding value and getting more profits. By endorsing products and services of great quality, you are creating new, hassle-free profit outlets for your small business. You'll also be offering your client base a larger variety of products and services. This means you'll be adding value to what you offer, and increasing your profits at the same time.

7. Youll increase credibility. Your joint venture partner probably spent years building a good reputation within their industry. They therefore have influence and credibility with their clients. By partnering with them, youll be tapping into this resource.