Thursday, September 23, 2010

Ms. X and the $5,000 Joint Venture Example

You can call it joint venture marketing, JV marketing, coopetition, co-marketing -- whatever.

They are different names for the same thing: found money.

Because ... when you form a partnership with another business to provide complementary products and services to each other's customers, you can quickly tap into a flood of new revenue, at little or no cost.

All you need to succeed is imagination and a willing partner.

Case in point: "Ms. X," the smart owner of a small Twin Cities service business who just landed $5,000 -- and growing -- in new revenue. Without spending one penny on advertising, new technology, or pay-per-click ads on Google.

While the sum of $5,000 may or may not excite you, the principle should: She got this new revenue for the price of a phone call and a short, in-person meeting with a former competitor (now a joint venture partner).

You can read and profit from my exclusive interview with Ms. X below.

(Why the cloak-and-dagger secrecy? I can't use her real name -- yet -- because she's part of a pilot training program I'm still putting the finishing touches on. You'll get the details when I pull back the curtain in a few weeks.)

Kevin: All right, Ms. X. Tell folks about the several thousand dollars that just fell into the lap of your small service business. What did you do?

Ms. X: We are a small company. We cannot always help our clients because there are things we do not do. For example, we do not do installations, so I wanted to collaborate with a company that did.

It has worked out great. We both have the same service philosophy and integrity. We send them jobs for installations such as the new (product name deleted) they installed for our neighbors. They send us jobs for service calls they cannot handle. It has worked very well back and forth.

I feel good because we have somebody trustworthy to whom we can send clients and, in turn, they feel they have somebody trustworthy to whom they can send clients. We have both given each other the leads with no money passed between us and we have each gained new clients.

Kevin: This was not some sort of mafia don meeting where it was high stress or a bunch of lawyers present, right? You simply called another, bigger company and offered to meet?

Ms. X: Yes. It took all the courage I had to even make that phone call and go to that meeting. I was a little nervous, but it proved to be a non-event. They were very warm and receptive.

Never in a million years would I have thought to start looking to expand our business by going to our competitors. We did, though, and now if we go on vacation, we have an ace in the hole knowing that our clients will be served properly in our absence.

Kevin: Tell me about that big order that fell into your lap as a result of working with this company.

Ms. X: They sent us to repair a (product name deleted) and it needed replacement. We were able to do that.

Kevin: Would you mind sharing the revenue that came in because of that new business lead?

Ms. X: That was a couple thousand dollars from one call and we have had other repair calls. I would guesstimate it was a $5,000 idea that popped into my head.

Kevin: We are only two or three months into your joint venture program and you already have close to $5,000. That really bodes well for compounding revenue and profits in the future, right?

Ms. X: Yes, it is just going to keep growing.

Now, here are 5 action steps for you ...

1) What products or services do your customers need, but you don't provide?

2) What 3-5 respectable competitors in your area could deliver what your customers need?

3) Call competitors and offer to meet, in person, to discuss how you might send them leads in exchange for leads from them, or a slice of the revenue, or both.

4) Keep calling until you form one new joint venture partnership.

5) Repeat until your customers have all their needs met, by you or your joint venture partners.

(Kevin M. Donlin is author of the Special Report, Guaranteed Marketing for Small Business Professionals.)

1 comment:

  1. Well done to Ms. X for having the guts to do that - glad it really worked out for her. *thumbs up*