As Seth Godin, entrepreneur, marketer, author, and inductee into the Direct Marketing Hall of Fame writes, in business development relationships, “both sides are buying, both sides are selling. So talented business development people never act like jaded buyers, arms folded, demanding this and that. Instead, from the start, they seek out partners.”
What Godin writes is astute. Business development is all about forming partnerships – unique partnerships that have often never been done before. Where this model falls short is in its ability to scale. This is precisely where the performance marketing model can teach the business development model a thing or two.
Both models adhere to the principles of finding, engaging, and nurturing partners, and paying them well when they bring in new business. The main difference is how the partners’ performance is tracked and compensated.
Lesson #1: Focus on the Few, but Don’t Ignore the Many
Most business development deals are large (e.g. Apple partnering with Nike), so they are typically conducted on a one-to-one basis and require customization. As such, a lot of time, negotiation, resources, and focus is given to these deals. While understandable, this also means that smaller and mid-size deals may get overlooked, simply because the bandwidth and resources are limited.
By leveraging the performance marketing model, business development teams can prioritize those big, lucrative deals while simultaneously using a standardized, repeatable process to manage those smaller and mid-size partnership opportunities.
Lesson #2: Say Goodbye to Manual, Hello to Manageable
When a typical business development deal closes, the process of tracking performance and compensating partners is often highly manual and time-consuming, which further prevents the business development team from focusing on more than a few big deals at a time.
For example, in the conventional business development model, once a partnership is agreed upon, the business development team – or their company – may provide the partner with a UTM code, a coupon code, or some combination of the two in order to track results. Spreadsheets are commonly used for reporting, as are paper documents for invoices, and physical checks for payment. What’s more is that, in this laborious, antiquated process, performance data is typically delayed, so partners often don’t know when they are doing well, making it difficult to act on opportunities in real time.
The performance marketing model offers a different process.
Here’s a real life example. Tiny Prints, the custom photo card and stationary company, was contacted by hundreds of independent photographers who were interested in producing holiday cards for their clients – all potentially great business development partners. However, it would have been impossible for Tiny Prints to manually manage all of these deals on a one-to-one basis. They may have been able to select ten or twenty of the larger, established photographers to partner with, but that would have meant turning hundreds of other potentially lucrative partners away.
So, they leveraged the performance model and were able to turn those few hundred photographers into over two thousand partners. What’s more is that they were able to manage them, track their performance, and compensate them, all in a scalable, brand-aligned way. This included providing these partners with:
- Personalized tracking links and a co-branded landing page to send their photography clients to.
- Direct-deposit payment (via an affiliate network) from cards sold through personalized tracking links.
- Content and support to help the photographers effectively promote Tiny Prints’ products to their photography clients.
By working with these partners through the performance marketing model, the process of tracking, reporting, invoicing, and providing payment was automated, profitable and scalable. There were no antiquated codes used, no spreadsheets, no invoices, and no physical checks to cut and mail out. The partners also got valuable coaching and resources to help improve their performance.
While the performance model is the most efficient, effective, and scalable way to work with brand-aligned partners, there will always be those large, game-changing deals that are best handled one-to-one. What the performance marketing model allows for is more focus on the development of those behemoth business deals without having to miss out on productive, profitable partnership opportunities due to time or resource limitations.
About the Author:
Robert Glazer is the founder and Managing Director of Acceleration Partners, founder and Chairman of BrandCycle and author of Performance Partnerships: The Checkered Past, Changing Present and Exciting Future of Affiliate Marketing. For more information, please visit www.accelerationpartners.com and connect with Glazer on Twitter, @robert_glazer.