When considering joint venture marketing the first question you should ask is what is the goal? Working with the competition does not seem as if it would be a wise business decision, but there are many situations where two different businesses teaming up together can result in good outcomes for both parties. A joint venture is when two businesses do just this – team up together for a decided amount of time, possibly creating a new entity with its own assets and share the revenue that results from the project. The goal of a JV marketing project is for two businesses to accomplish something that they ordinarily could not do by themselves.
Kicking off the plan
The first step to this process can often be very difficult. The company that comes up with the idea has to be able to explain to the other company why it would be a good idea for the two of them to team up together. A plan created where only one company benefits won’t work because the other business will not see the benefit. Both sides have to see how the joint venture would be beneficial to them. The benefits that each party will be receiving do not necessarily have to be the same, but they do have to be important enough to convince the other business that it would be more beneficial for them to team up than not to.
After both parties are in agreement to work together, have clear plans drawn up of what they are going to do. It needs to be decided which employees from each business will be working on the project. Situations such as whose office the participating workers are going to meet at need to be addressed. If one company has better technology for one aspect of the venture, but the other company has something else that will benefit the project, then it is probably a wise choice to use both locations depending on what is being worked upon on a given day.
The finances of the marketing plan
One of the most important things to decide is how the expenses will be split. Since the cost of starting a new business venture is usually quite high, teaming up with another business is a great way to make it more affordable for everyone. Also, the partners need to decide how the profits are going to be divided up in the end. If one party is doing more work than the other, it might be decided that they will receive a greater percentage of the profit. In most situations, however, the best thing to do it split the profit evenly.
Wrapping up the marketing game plan
Depending on the goals of the joint venture marketing project, the amount of time that the parties will work together will vary. Some objectives can be reached in less than a week, while some companies remain partners for years to reach their goals. If the venture goes well, it is a wise idea to stay on good terms with the other party even after the project is over. This way, if another situation arises in the future that both parties could benefit from, the other party is more likely to agree.
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