Funnel and Type of Strategic Alliances

Abdul Hassan
Nov 9, 2019 · 4 min read

Traditional way of building a business channel has been through sales funnel and marketing. Strategic Alliances act as an alternative channel for building business and leveraging the other partners resources to achieve the end business goal. As a channel it plays an important role for distribution, customer acquisition and additional value proposition for companies in eCommerce, SaaS and other categories.

Source: Insperity

Before building a partnership, one should identify the core objectives it would like to derive from the partnerships. Such as, How the business can benefit in terms of value proposition and if the partner has right set of customers which are aligned to its business goals. At times, the value proposition of alliances is under looked upon and focused on alternative side from the partners which can undermine the benefit it would be achieving upon.

For any alliance to be successful it should be win win situation for both the parties. A successful collaboration would require both the parties to sync and work on achieving a common goal. Although revenue is the end goal of any business, other factors such as reach, product integration, brand penetration needs to be looked upon to for measuring an alliance as this would eventually contribute to the downside of revenue cycle.

Source: https://www.mediaupdate.co.za/

Unlike sales cycle, alliances would require a certain time period to reach the revenue funnel. For instance, partnering with a high volume website for redirection can lead to traffic on the partnered website but this doesn’t mean it would lead to direct customer acquisition or sale on the traffic rate which is being redirected at. Hence it is essential to have KPI’s to measure the impact through the partnered channel and how it can be converted into the end funnel goal.

Every organisation has a different business goal, below are some of the type of alliances and examples of how various players in the industry are levering through the Strategic Alliance model.

Type of Strategic Alliances:

  1. Co-branded programs: This can be defined as programs, where two partners enter into a agreement to develop a product or platform which will help the partner business mutually. The proposition and definition of co-branded programs differ from industry to industry.
Source: ICICI Bank

For Instance, Banks have tied up with leading eCommerce merchants to launch co-branded cards, which will enable the customers to get additional benefits on the cards through the partnered platform and increase the end funnel of transaction for the merchant partner and acquisition of new customers for the banks.

2. Product Integration: Product integration partnerships are more aligned towards SaaS companies, where the partnership is inclined towards collaboration with other service providers for providing value add on through its channels by the partnered resources. The value add on factor can help to position the product apart from its core benefit to its clientele.

Slack on its platform has integrated with various category players on its platform such as Google Drive, Zoom, Workday, Salesforce and many more. Through integrating with various partners, it is able to increase its value proposition of being more than a chat app and workforce can use the platform for all the office work needs.

3. Revenue partnerships: Revenue partnerships can be also know as channel partnerships, where the end goal is mostly inclined towards the revenue generation from the respective partner business. This is one of the most ideal partnership channel on which most of the businesses work on. In this model, revenue is shared equally on the profits generated.

One thing to be highlighted is most of the times revenue partnership fail, due to wrong projections, targeting the wrong set of customers and importance of the value the partnership business is for the partner. It is essentially to understand and evaluate both the business before working on a revenue partnership.

4. New product add on: In this type of partnerships, businesses can look for additional value proposition they can generate through their platforms. Such as Goliath and giant where a brand of high proposition in the market can tie up with a partner to provide additional services on its platform through its technologies instead of building a new feature as such.

For example, Amazon India tied up with ClearTrip to enable flight ticket purchase on its platform through its payments Amazon pay. Through Amazon Pay customers will be getting additional cashback and discounts, helping amazon pay to increase it usage apart from the services available on its platform, and ClearTrip will be able to acquire new customers.

Apart from the above mentioned strategic alliances, they are many more kind of partnerships with the changing business needs. Do let me know, in the comments the kind of partnerships and some of the examples.

Let’s connect at: www.linkedin.com/in/abdulhassan

Abdul Hassan

Written by

Marketing by Profession, Traveler by Passion www.linkedin.com/in/abdulhassan

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