On a recent evening, I carpooled downtown with a friend to hang out, but he had to leave early. Fortunately, there’s always a backup plan when it comes to transportation these days — that doesn’t involve riding in the dirty backseat of a cab. You can just schedule an Uber ride through the app on your smartphone.
Earlier this year, I found out that, as a Spotify Premium subscriber, I can also listen to my favorite tunes through Spotify while en route to my Uber destination. It was fun to give it a try and a pretty good deal, too!
As I stepped into the vehicle, my marketing brain realized that this was a perfect illustration of a strategic business partnership in action. Both Uber and Spotify had a lot to gain by joining forces.
Spotify’s Uber Successful Partnership
In late 2014, streaming music service Spotify announced a partnership with Uber, allowing passengers to listen to their own music during the ride. This was a huge win for both companies’ market reach.
How does it work? If you have a Spotify account with a paid subscription, you can have your Spotify music playing before you even set foot in your Uber ride. Once you’re in the vehicle, you can wirelessly control the music from your phone’s Uber or Spotify app until you’ve reached your destination.
When I stepped into the Uber that evening with Spotify on my phone, I proved that their simple partnership could dramatically boost customer loyalty to both brands.
Why the Uber-Spotify Partnership Works
Why is this such a powerful alliance? Uber can provide more value to its own customers in the form of customized music without reinventing the wheel, so to speak. But it also attracts new customers to Uber.
Uber’s CEO Travis Kalanick revealed that the Uber app serves two million rides per day. If even a small fraction of those rides decide to use Spotify, that’s a massive opportunity for acquiring new paid users and building brand loyalty. It extends the competitive advantages of Uber and Spotify in one slick deal: Uber gets an easy way to offer a personalized music experience as part of its service, and Spotify has one more angle to get users to sign up for its Premium service. Talk about a win-win strategic business partnership!
Grow Big Like Uber and Spotify
You can learn a lot from Uber and Spotify. Even though the two companies were already massive — Uber’s value topped $40 billion in late 2014 when the partnership was formed — they were able to propel themselves to even greater success together. Since that time, Uber has grown to a valuation of over $66 billion.
Uber is incredibly aggressive in its expansion to achieve such massive growth. You obviously can’t attribute all of their success to a partnership with Spotify, but it’s no coincidence that Uber has grown so popular and influential as it partners with not just Spotify, but also a number of other big brands, including:
- Capital One
- Starwood Hotels and Resorts
No business is an island, and yours can really benefit from strategic partnerships with other companies. What makes strategic business partnerships worth pursuing over so many other marketing strategies is the bang for your buck. Think about it. With roughly the same amount of effort and resources needed to acquire a single customer, you can acquire a partnership that yields dozens of new customers on an ongoing basis.
And these are not just any old customers. If you’re deliberate about who you partner with, you’ll gain targeted access to your ideal customer. This is the perfect route to reach people who want to invest in your services or products!
A Referral on Steroids
Wildly successful businesses have built up a lot of credibility with their customers, so if they recommend your business as a strategic partner, you can bet their audience will be primed to listen up. Partnerships magnify the results of your outreach efforts because someone with a lot of influence is giving you an endorsement or shoutout to the very people you want to reach.
You can also recommend a strategic partner to your customers. If you get to know other companies and cultivate powerful relationships with them, then you have a reliable way to satisfy a customer who needs something your business doesn’t provide. When you can point customers toward a company with offerings that are complementary to your own, even the simple act of referring them will be a customer service win.
It’s Strategizing Time!
Here at The Newsletter Pro, we have strategic partners of our own. Last fall, we connected with Ben Glass, a lawyer whose company, Great Legal Marketing, helps other lawyers with their marketing. Before partnering with us, Ben Glass’ company offered newsletters as part of their marketing services, but after they got to know us, they decided it made way more sense to have us be their recommended vendor for newsletter creation.
That means they’re selling lawyers on newsletter marketing for us! Since we started working with them, we’ve consistently seen 10 to 15 percent of new clients coming from Ben Glass and Great Legal Marketing every month. Those are valuable new clients — already well into the double digits — who were primed to buy through their relationship with Ben and his team.
In return for getting great clients from Ben Glass, you can bet that we refer them legal clients of our own who might benefit from marketing services beyond newsletters. As partners, we also market to each other’s lists, and we’re discussing a possible joint Ben Glass and Shaun Buck marketing event in the future. This partnership again proves how impactful partnerships can be at any level, whether you’re a ride-sharing service or a newsletter marketing company.
Who Are You Gonna Call?
While The Newsletter Pro has more work to do in developing strategic partners, we’ve already seen how powerful partnerships have been in growing our business. Now, it’s your turn! To put the “strategy” in strategic partnerships, think about the businesses, brands, or professionals who would benefit your business in some way, whether it’s an overlapping target audience or a unique skillset that you need on your side.
Take 10 minutes and brainstorm a list of all the possible partners you could have for your business. Don’t be afraid to stretch. If there’s a big company you want as a partner, stick it on your list. You can always work up to bigger companies, but you may be surprised who will be receptive to a partnership offer!
Ultimately, what it comes down to is how much of an ROI you want for your time and money. Would you rather chase dozens of individual prospective customers or connect with one partner who can refer dozens of new clients to you month after month?
Strategic business partnerships are the way to sustainably grow your company, increase your own credibility, and make every new client more profitable.
Now is the time to get started on your list. Next week, we’ll delve into the best ways to build strategic partnerships that propel your business to the next level!