The BIG Idea File – How to make 1 + 1 Equal 5: Partnering for Prosperity

The mathematics of partnerships is this: 1 + 1 equals 5 (or more). The reason is doubling and tripling effect of a synergistic relationship. Shared customers mean resources go further and get more results.

Take Starbucks and Safeway as an example.

Starbucks partnered with Safeway to launch in-store locations, expanding their retail coffee reach without investing in more retail real estate. Starbucks sells more high priced coffee to Safeway customers and the convenience of an in-store Starbucks attracts more customers to Safeway. Everyone wins, including the customers who benefit from the added convenience.

Now I routinely go out of my way to go to Safeway, thinking how much I love the convenience of grabbing a latte on the way out of the store after finishing my grocery shopping. It’s just easier for me as a customer than driving even a parking lot length and hauling my daughter out of the car for a second stop.

This is where the math comes in.

Two points for Safeway (one for influencing customer behavior and another for doing it without advertising). Add two more for Starbucks for a guaranteed sale and often an added bonus of my daughter ordering a Kids’ Hot Chocolate. Tally up a final point for that invaluable loyalty that entrenches the Safeway Starbucks habit into my weekly routine.

How to develop a 1 + 1 equals 5 synergistic partnership

#1: Shared target audience – You need to be targeting the same (or very similar) target market. Maybe your target audiences are exactly the same or simply a subset – it doesn’t matter as long as there is enough of a common base.

#2: Enhanced value proposition – It can’t just be about selling more to your customers. Your customers must benefit in a tangible way from the synergy.

#3: Logical extension – The partnership has to ‘fit’ the brand story of both partner companies – a logical next step in the evolution of both businesses. If it seems like an out of nowhere move to your customers, perhaps it isn’t a good move.

#4: Simplicity of relationship – It relationship has to be one that is easy to step into for the math to work. If it requires a lot of additional infrastructure, effort or resources (relative to the scale of the partnership), it fails the simplicity rule.

#5: Common vision – It’s best of both companies are united by the same vision and philosophy. The common ground will drive decisions and make the partnership an easy one to navigate.