There are many success stories of companies who have paired up with another business to cross-promote a product or a concept. Look at Google and any number of technical companies like YouTube, Waze and Nest Labs (the home thermostat company). Or consider Starbucks and Teavana. Or potato chips made with barbecue sauce and ice cream companies who add candy to their confections. Even Crest toothpaste is co-branded with Scope mouthwash!
Most of these companies have shared values but differing business models. Some are seeking the same customers, yet others with slight variations. Often they have similar communication vehicles and target audiences.
Through a series of recent interviews with builders, real estate investors and real estate sales managers, we found a theme of 5 key elements sought in successful co-branding within in real estate:
The number one theme that came across in all conversations was trust. Everyone wants to be able to trust a partner and also be a trusted contributor. Each wanted to know that they had a partner on whom they could rely. Dependable, consistent and reliable were the terms most often used when describing the ideal co-branded partnership. For example, builders need stable lending institutions to finance their projects. They also need legal advice on zoning and building code regulations. It was most critical that a partner work to create a trusting relationship.
2. Shared Values
Another common theme was shared values and the ability to reach financial success together without either side compromising. Real estate investors felt it was critical to partner with an agent who had their best interests at stake, not simply an eye on a commission check. One investor noted that he would return purchase after purchase to the same agent if he felt that they had shared values, meaning they were placing the same emphasis on location, amenities and cost basis.
3. Target Audiences
When creating a co-branded relationship, it is important to assess the target audiences of each partner. When those audiences merge, it becomes easier to communicate a joint message. For example, one real estate sales company has an alliance with a home warranty provider. Both are catering to the needs of sellers and buyers and can therefore align their messages to each side of the transaction. The sellers are seeking highest price, best terms and most convenient timeline, while hoping for a smooth transaction. The home warranty provider can assure the seller that if something breaks or malfunctions during the sales process, it may be covered by their policy. Buyers are also seeking best price, value, terms and timing. Providing a warranty may allay fears (real or unfounded) that arise during a transaction. It’s a win-win.
4. Communication Channels
When both parties in a co-branded relationship are using the same or similar communication modes, it is easier to frame a message. When television or radio are the preferred mode, each side can cater their advertising to a similar audience, saving resources by “doubling down”. One mortgage lender said that when she can team up with a partner, it cuts her costs by 50 percent, but doubles her reach.
5. Common Goals and Value Added
Another trending theme of these conversations was the idea of having common goals and getting/providing value to one another. Most people felt that they needed to have a common goal, like attracting a similar customer (i.e. first time buyers, move-up buyers, empty nesters, etc.) or achieving brand recognition, in order to succeed in a co-branded relationship. There were some common ways that all groups said they could use co-branding, including shared signs, brochures, publicizing classes or open houses and networking events.
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All agreed that the biggest reason why they would look at co-branding was financial benefit, followed by brand recognition. There has to be a potential monetary gain for both parties to consider a joint venture. Once that exists, the remainder of the pieces will fall into place. At least it has for Google after each new partnership. So if you are considering a new business partnership, these 5 key elements could assist you in becoming a business powerhouse too.