Co-marketing is rooted in teamwork and shared success. While competition may be a natural part of business, not every company that shares your target customer is a competitor. There are many opportunities to collaborate and partner with other brands that share the same goals.
Sharing resources and audiences allow two complementary companies to execute marketing campaigns that otherwise would have been impossible alone. It enables you to tap into new markets and capture the attention of fresh faces by allowing another business to market for you.
For example, a cosmetics brand might partner with a celebrity in a co-marketing agreement. The makeup company features the star in 2 multimedia campaigns, increasing their exposure. In exchange, the celebrity features the makeup in 3 social media posts to market to their own audience.
Co-marketing is a well-known strategy with a proven track record. In this article, we’ll look at what co-marketing is, the benefits of this strategy, how to implement it, and real-life examples of co-marketing in action.
What is Co-Marketing?
Co-marketing is a strategic approach in which marketing efforts are shared between two complementary brands. By forming a mutually beneficial partnership with a non-competitor, both parties can market more efficiently, reach new audiences, and drive sales.
The exchange between parties can include the following:
- Collaborating on content - Appearing on each other’s channels, co-hosting podcasts, and sharing social content across all channels.
- Free samples - Sending free samples to qualified customers through your partner’s orders.
- Sharing emails captured - Accessing shared data from a joint campaign that was executed with shared resources.
- Harnessing reputations - Using another brand’s reputation while giving them exposure to your customers.
- Cross-promoting - Bundle products or cross-promoting to each other’s respective audiences.
Co-marketing can take on many forms and is negotiated between B2C and B2B brands, small businesses, established brands, new startups, etc. It works as long as the channel partners can connect the dots to establish equal value on both ends.
Main Co-Marketing Types
The two main types of co-marketing that are practiced include:
- Affiliate Marketing: This is where brands collaborate with influencers, bloggers, and other creatives with a similar audience, to gain access to new customers.
- Distribution Partnership: This involves co-marketing efforts where a brand bundles a partner's product with its own, or vice versa.
Other Types of Co-Marketing Strategies
In this co-marketing strategy, a product is placed in a section of the other brand’s website. You may have seen this before on your favorite TV show. The character is clearly drinking from a Coke can. That’s intentional advertising.
In a licensing agreement, the other company has permission to sell and distribute your product. For example, a candle manufacturer might enter into a licensing agreement with a boutique, so they have permission to sell the goods. This also happens a lot with superhero movies and fast food restaurants.
Sometimes, a larger brand will sponsor a smaller business to put its name front and center. This form of co-marketing is done to increase brand exposure and drive engagement. There’s no greater way to affect an audience than in-person events.
Content Marketing Partnerships
In this co-marketing strategy, one brand generates content for the other in the partnership. This helps to control brand messaging and leverage reach. One example of this is when two bloggers write guest posts for each other, or when one podcaster appears on the other’s show.
Joint Product Partnerships
When companies collaborate to either launch a new product or improve upon an existing one, it’s considered a joint product partnership. In most cases, it’s a small and larger company teaming up, where the smaller brand benefits through awareness and acquisition, while the larger enterprise benefits by improving the product and boosting revenue.
Loyalty Marketing Programs
An incentive marketing program encourages specific customer behavior with offers for partner brands. In this case, brands are working together to reward customer loyalty. This can happen when people purchase frequently, make high-value transactions, or even promote the brand themselves.
In this co-marketing method, one company agrees to refer business to the other, in return for a reward. This is particularly useful for small businesses that offer limited services. That’s because the business can fill a gap in the services offered by referring customers to another company they trust.
Co-Marketing vs. Co-Branding
Co-branding works a little differently than co-marketing, although there are often grey areas. While co-marketing refers to joint promotional efforts of separate but related brand offerings, co-branding involves two companies collaborating to develop a new product, service, or content item.
For example, a high-profile designer collaborates with a popular sneaker brand to create a new shoe for the season. In this case, they are co-branding. Had the sneaker brand created the shoe alone, and then asked the designer to promote it on their social media, that would be a form of co-marketing.
Whether your business is using a co-marketing or co-branding strategy, it’s a win-win for both partner brands, and all parties involved.
Benefits of Co-Marketing
Compared to traditional solo marketing strategies, co-marketing comes with unique benefits. That’s because both parties are putting emphasis on strengths, and helping each other with weaknesses. It’s a collaborative effort that produces elevated results. That’s why there are so many advantages to this method. Some of the benefits of co-marketing include:
Increase Conversion Rates
Co-marketing allows a business to gain exposure from another company’s customer base. This helps to acquire new leads, increase conversion rates, and sell more products. When done right, co-marketing enables a brand to drive opt-ins, grow their list, and increase traffic to any given promotion.
Boost Brand Awareness
Running a successful partner program will help to cement your business as an industry leader and boost brand equity. Co-marketing enables a brand to break through the noise and introduces them to an entirely new audience who may have otherwise scrolled past. This can set you apart from competitors in a big way.
Attract New Clients
Co-marketing attracts new clients by working with companies that share your buyer persona, but belong to a different product category. As a result, a company can gain instant exposure to the social following of a partnering brand or email list, with minimal effort.
Engage Target Customers
Partnering with a brand that complements your own presents instant opportunities to market products/services at the perfect time. This allows you to engage target customers exactly when they might need you.
For example, do you ever notice a hotel discount pop up when booking a flight? That’s not an accident; it’s co-marketing. Cross promotions are convenient for customers, which adds instant value.
Co-marketing can maximize channel revenue and cut costs by pooling resources like budgets, networks, talent, distribution channels, and more. Both parties share the marketing costs associated with the campaigns created.
Additional Benefits Include:
- Build brand name identity and generate press coverage
- Gain leads already interested in your product
- Expand your network with credible connections
- Build long-term relationships with value, knowledge, network, and support
6 Real-Life Co-Marketing Examples
The secret to reaching new prospects lies in the relationships you form with co-marketers. If you want some examples of successful co-marketing styles in action, here are a few:
#1) Redbull and GoPro
Marketing Type: Co-marketing
Objective: Gain publicity with record-breaking stunt
Outcome: The marketing campaign broke records for both brands, as well as the world
Remember the guy that parachuted from space? Of course, you do! That was all a co-marketing campaign.
Red Bull and GoPro are a famous co-marketing pair. At the peak of the mania, they released a campaign in which Australian skydiving legend Felix Baumgartner jumped from a balloon 24 miles up in the atmosphere. All of this stunt was sponsored by Red Bull and captured by the GoPro helmet on his head.
#2) Apple and Mastercard
Marketing Type: Co-marketing
Objective: Create more convenience for customers
Outcome: Changed the evolution of payments
When Apple released Apple Pay, it changed how we transact, allowing people to buy things with their phones, instead of a credit card. However, in order for this to work, they needed a credit card company on board to integrate with the technology.
That’s where Mastercard stepped in. It also enabled the credit card brand to get ahead of the competition by being the first company to allow users to store their cards on Apply Pay.
#3) Taco Bell and Doritos
Marketing Type: Co-branding
Objective: Promote cheap, fast food that people crave
Outcome: Sold more than 100 million in 10 weeks
The marriage of Taco Bell and Doritos was an instant success. The name of the product, Doritos Locos Tacos, is a prime example of co-branding and digital marketing genius, with Taco Bell selling more than 100 million Doritos Locos Tacos in the first 10 weeks. They had to hire an additional 15,000 workers to keep up with the increased traffic and demand.
Why was this such an astounding achievement in such a small amount of time? Because both brands serve virtually the exact same customer and demographic (young people who crave cheap food), but they’re not really in competition with each other. One is fast food, and the other is snack food.
#4) Lucas Films and Homesick
Marketing Type: Co-branding
Objective: Create a Star Wars experience through scent
Outcome: Press coverage in national publications and leveraged manufacturing capabilities
Lucas Films teamed up with Homesick candles to create an out-of-this-world experience for Star Wars fans. Both brands came together to develop a co-branded product. The unique candle collection features the scents of fictional planets from galaxies far away.
The partnership earned national press coverage, and LucasFilms was also able to leverage Homesick’s manufacturing capabilities. It was a mutually beneficial move for both brands.
#5) Uber and Spotify
Marketing Type: Product Placement
Objective: Boost rides and subscribers
Outcome: Spotify gained more users, Uber gained more rides
Spotify teamed up with Uber to place their product with a free trial in the campaign “Soundtrack for Your Ride.” When riders are waiting, Spotify allows them to become a DJ for the ride. Users can create custom playlists that can be played on rides in the future. This prompted people to call Uber more often and boosted the number of subscribers for Spotify.
#6) Mattel, Disney, and Pixar
Marketing Type: Licensing Agreement
Objective: Design and develop toys inspired by Pixar characters
Outcome: Great success so far with Toy Story 3 and the Cars franchise
Mattel has a strong relationship with Disney, and has expanded its global licensing agreement for new titles and designs, as well as toys inspired by all characters from Pixar films.
This is just the latest example of Mattels’ commitment to collaborate with globally-recognized companies, as part of their transformation into an IP-driven, high-performing toy organization.
How To Implement a Co-Marketing Strategy
How do you implement a co-marketing strategy that produces results? Here are a few steps to consider in the process:
- Set Goals - Both brands should agree on what they wish to get from the co-marketing partnership. Set clear goals, KPIs, and metrics.
- Develop Content - A new campaign needs co-branded content to amplify the value of your offering. Select the types of content you wish to develop and align deadlines with KPIs.
- Create Timeframes - Set a specific timeframe for the campaign. This helps all involved get on the same page.
- Understand Pain Points/Strengths - Discuss what each partner is good/bad at, then assign tasks accordingly.
- Define an Agreement - You need a written agreement to ensure a solid partnership and avert risk.
You may also want to discuss payment strategies and any tools you intend to use. It is recommended to seek automation, and digitize as many manual processes as possible. Once an agreement is signed, you’re ready to get started!
Leveraging Brand Partnerships to Your Advantage
Co-marketing only works when both parties prioritize reciprocity and craft an equally valuable deal for everyone involved. The nature of the exchange has to be fair, and the terms must be explicitly stated.
Nevertheless, Co-marketing is a great way to tap into new audiences, share resources, and drive conversions. It’s a cost-effective strategy that will benefit a business of any size. Larger firms can deliver a consistent brand experience across a big audience. Smaller companies will have the chance to work with renowned partners who can boost their brand awareness.
When looking for potential partners, it starts with a collective buyer persona. If the co-marketing partner has the same audience as you, there’s not much to adjust with messaging. The tone and style of your marketing will feel the same. This helps brands maximize partnerships to grow their audience and revenue.
However, if both of you are busy organizations, you may want to consider some automation tools to manage co-branding campaigns.
Relevize enables a brand to rethink what it means to be “partner first.” The combined power of the software and thought leadership means a business can create a premier experience that excites and engages its partner ecosystem.
The Relevize platform provides everything you need to turn partners into your best channel revenue, from dedicated onboarding to setting up paid programs, measuring leads, scaling campaigns, and much more. Relevize is a vital resource that helps co-marketing brands get organized.
Want to learn more about how it works? Start driving results with our free demo today.