Joint Ventures | How to choose a joint venture partner

We’ve already mentioned joint ventures briefly, but in this chapter we’re going to look at these kinds of partnerships in much more detail. I can’t stress enough how important joint ventures are in creating a profitable online business. It doesn’t matter what products or services you’re selling, there are always people that you can partner up with in a way that will bring benefits to both of you, without costing you a penny. It’s those savings that boost your profits and reduce your costs.

In this chapter, I’m going to explain how to find partners, reveal a number of different ideas you can put into practice, and show you how to keep track of your deals.

Selecting the right partners is crucial for the success of a joint venture. As always, the best bets are businesses whose services complement your own. If you’re selling CD’s for example, you could do a deal with company that sells audio equipment, or a music magazine; if you’re offering home-made furniture, you could partner up with other home furnishing companies.

Essentially, you want to be sure that you’re both appealing to the same kind of market but not directly competing.

One way to find partners is to figure out where they advertise. As you surf around sites related to your business, you’ll probably notice that you keep seeing promotions from the same sites. Those are the kind of people you want to team up with.

In fact, you don’t even have to look further than your inbox. You probably already get a whole bunch of newsletters from companies in related industries, and are already pretty familiar with their business. Your first choices for joint ventures then will probably be easy to think of—and they’ll probably be the best ones too.

If you want to expand the scope of your partners beyond the immediately familiar though, it’s worth downloading Alexa. This is a neat little software tool that plugs in to your browser and ranks websites based on the amount of traffic they receive. That makes it pretty useful when you want to be sure a potential partner has a decent amount of users to send you. It’s also free.

You can then do a keyword search, pick the top ten sites, and use Alexa to get an idea of how big those sites really are. Alexa will even tell you the name of the webmaster and give you a contact number.

Of course, it’s one thing to get in touch with a potential partner, it’s quite another to get them to agree. In my experience though, this isn’t really a problem. About 80 percent of the people I contact already know me and understand exactly what I have in mind. Once your business is up and running, you’ll probably find that’s true too. The whole negotiation takes nothing more than a couple of emails and maybe a five minute phone call.

Even a cold call gets pretty decent results. In general, I start with an email introducing my site and suggesting a partnership. It’s pretty rare not to get a reply at all, and about half of my proposals result in a deal.

So what sort of partnership do I suggest? In practice, that depends on who I’m writing to. Clearly, you want to make sure that you create a joint venture that uses your partner’s strengths to strengthen your own services—and your profits.

This is a newsletter joint venture. A user comes to your site and signs up for your newsletter. They then get a thank you message inviting them to sign up for other newsletters that they might find interesting. Those other newsletters are your joint venture partners. In return for an advertisement on your site, you get the same on theirs. You want to be careful not to pester the user so the invitation needs to be kept simple and well targeted.

Exit pop-ups have become an increasingly popular way for Internet-based companies to work together. The fact is only a tiny percentage of the people who visit your site will actually give you money. The rest will just click straight through. The problem is that you’re paying for all of those users. Whether you’re buying them on a search engine, an advertisement or some other deal, you’re paying. The more ways you can find to turn those users into money, the better.

Exit pop-ups present another website to a user as soon as s/he leaves your site. The advantage is that your users aren’t bothered until they actually leave (in which case they’re no longer your users), and you can choose which pages generate the pop-up. So if a user comes to your home page and then clicks away, they get offered your joint venture; if they purchase, they don’t.

On the downside, most exit pop-ups are with competitors which means you’re getting good users but giving them extra business. Users also find them annoying.

You can approach another site directly to arrange an exit pop-up joint venture, or you can use any one of a number of different companies to join a wide ring of sites offering the same service. WebTrafficSwap.com for example, gives you two users for every three that leave your site. They also make sure the users you receive are well-targeted and unique. They’re a pretty useful site if this is the way you want to go.

There’s no need to be too subtle with joint ventures. There’s nothing wrong with using your email list to simply send a marketing letter to your subscribers to plug your partner’s products. You'll have to negotiate a good deal for this in return—one that includes a mail-out of at least a similar scale.

Ultimately, a successful joint venture depends on providing services that are truly complementary. Offline for example, a computer technician could make a deal with a computer store offering customers free installations and advice in the first three months after their purchase. He’d get access to a pool of potential customers; the store gets an extra service to offer its users. Online you can use similar special offers to truly boost the power of your partnerships.

The best way to make your joint ventures truly successful is to use exclusivity. Offer your users something they can’t get anywhere else, even if it’s someone else’s services, and you make your users feel that they’re getting a real value by knowing about your site. Of course, if you want your partner to give something truly valuable to your users, you’ll have to do the same for them. That’s not really a problem though. You don’t have to give them all gold watches, but you can offer them a discount or a special offer.

For example, I get a newsletter every week from a marketing guru. Just about every edition he sends me contains at least one offer of a book or some other product at a bargain rate. Those products come from his joint venture partners, and I assume that he’s doing the exact same thing with his products on their newsletters. I get a lot of newsletters, but his is one I always read. I never know what sort of offer I’m going to be made next, and I know that I’m getting a real value in return for my free subscription. If you’ve got a good relationship with a joint venture partner, these are easy to arrange.

Whenever you enter a deal, whether it’s listing a keyword on a search engine, buying a banner ad, or entering into a joint venture, it’s crucial to track your progress.

The only kind of joint venture you should enter into is an equal one. There’s no point in sending thousands of users to a site that only sends them back in the hundreds. You’re going to wonder what you’re getting out of the deal and if you can’t get more somewhere else. You probably can.

How you track the responses will depend on the particular joint venture. If you’re swapping users, any traffic monitoring script should keep you in touch. Otherwise, you’ll have to monitor sales—ultimately, the best way to monitor your progress.

Joint ventures are one of the most enjoyable ways of promoting your business. Working from home can be pretty lonely. When you start to set up joint ventures not only do you get access to the customer bases of other entrepreneurs, you also build up a network of other people working in the same industry. There are benefits every way you look.

The whole point of joint ventures is to generate customers. But even more important that getting them is keeping them. It costs much less and bring in much more money. Before we go on to talk about products, I just want to stress the importance of marketing to your existing customers.

At the end of every month I sit down with my stats and sales figures, and try to figure out answers to the following questions:

It doesn’t take long to answer these questions, although it does take a bit longer to put new procedures in place if an answer comes up ‘no’. But it’s definitely worth the effort. I’ll confess, I went into this for the money, but I love getting letters from satisfied customers praising me for my service. The fact that it pays to do that too, is a real bonus.

Essentially, there are two golden rules for providing great customer service: punctuality and politeness. Always answer your customers as soon they write to you and send out their goods as quickly as you can. And always maintain a professional, business-like manner with them. It doesn’t matter how much they complain or moan, or how unreasonable they are, remember that you’re a professional and keeping your cool is part of your job. It’s all about customer satisfaction.

So now you know of a whole range of different ways to promote your website. You know how to use search engines, buy advertising and build affiliate programs. You understand the benefits of newsletters and how to set up joint ventures with other people selling on the Web. In the next two chapters we’re going to look at precisely what you can sell on the Web, starting with information products.

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Joint Ventures—Partnering For Success (Step-By-Step Guide To Building A Profitable Niche Marketing Business - Part 17 of 27)