Some Partnership Pitfalls and how to avoid them

Business partnerships are great.

From outsourcing deals to franchises to tie-ups, they deliver economies of scale, let us focus on our core proposition and extend our reach.

But partnerships have pitfalls which can risk damaging your brand.

You can avoid many of these pitfalls by making sure your partnership approach is properly thought through, appropriately funded and aligned to your brand strategy.

Hardly rocket science, yet sometimes we still get it wrong.

We recently had a family trip to Costa Rica. We mostly had a fabulous time, and the bits which weren’t fabulous provided me with grist to the mill for this blog, so really a ‘win-win’.

We booked the trip with a well-known premium small group tour company in the UK because of their reputation as a quality provider with high standards.

They had partnered with an operator in Costa Rica to deliver the ground component of the tour. Perfectly fine, and necessary for them to offer the trip at a price point suitable for a semi-retired potterer like me.

It was no big deal to find on arriving in San Jose that our tour bus wasn’t the nice shiny one with the UK tour operator branding, but the one next to it in the local company livery, with an A4 laminated printout of our operator’s logo blu-tacked to the window.

It was more of a deal to find that our tour guide had never run this tour before, hadn’t  shadowed another guide on it, hadn’t been fully briefed on the itinerary, and was prepared to deliver a tour which differed in important respects from the one we had paid for. (It’s not inspiring when the tour blurb trumpets that you’ll snorkel in the Caribbean and Pacific Oceans and your guide tells you won’t be snorkelling in either).

After some gentle cajoling we did end up getting more or less what we’d paid for, hence we mostly had a fabulous time and I was left feeling amenable enough to consider what this experience tells us about partnership management, instead of just blanking the whole experience and vowing to try Scarborough next year.

The main partnership failing for us as customers was the gap between our expectations of the brand and what was delivered through the partner.

Some of this gap was pure perception (the blu-tacked sign) whereas other aspects were more material (the failure to deliver the contracted snorkelling trips).

The material aspects are clearly more important than those of perception, but both matter when it comes to brand.

I worked for a premium full-service airline when new partnerships started in the form of franchises and alliances, and we had to deal with the customer fallout.

Our customers had complaints ranging from those based purely on perception (‘I bought a ticket with your airline and ended up flying with a different one and I didn’t like the uniforms’) to material issues like differences in on-board catering.

These were dealt with by management strategies ranging from putting in more money to ensure consistent service standards, to extensive PR and comms with our customers, to simply accepting the complaints as an acceptable price for the extra business.

They were all valid management approaches because they were undertaken consciously and sustained throughout the partnership.

The problems tend to start if you under-invest in the partnership or if you neglect it when your business grows or changes.

In the case of our Costa Rica experience, and from talking to others who have used the same UK tour company, I got the sense that their growth rate might have outstripped their ability to manage their partnerships to a level which is consistent with their brand.

If you’re running two tours a month in twenty destinations, maintaining a quality proposition with your partners is much easier than when you’re running twenty tours in two hundred destinations.

I didn’t see anything to suggest the issues with the tour were due to basic under-investment in partnerships, although this is something I’ve observed elsewhere, and particularly where big brands are involved.

If you have a strong brand, it’s almost a given that you will use that brand value as a negotiating lever with partners. “We’re not paying you top dollar, but think of all the value you get from being associated with us.”

The problem being that all that reflected glory from your brand doesn’t pay your partner’s bills.

If you nail your partner to the floor on price, there’s a significant risk they won’t be able to sustain the product or service standards your customers expect from your brand.

Quality and brand value starts to slip, or your esteemed partner hits you with a bunch of costly contract change orders as punishment for your arrogance.

Invest properly in your partnerships and nurture them to protect customer retention and brand, or accept that both will suffer if you let your partnerships fall short of your brand values.

As for us, we’ve got a mildly defensive apology letter from the tour company, a money off voucher we won’t be using, and that bunch of brochures on the delights of North East England’s Riviera – see you in the Harbour Bar for a Knickerbocker Glory!

 

 

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s