Today, almost all markets are full of goods. Such an excess of supply makes the consumer very picky and harder to persuade to make any purchase. In response to growing competition and the increasing complexity of customer involvement in communication, cross-marketing appears. How to quickly and cheaply attract customers? This question plagues marketers around the world. There is no single correct answer to it. But cross-marketing can solve a number of problems in attracting consumers, but there are a number of nuances in its application.
Cross marketing concept
Answering the question of what is cross-marketing, you need to remember that marketing is the company's activity in promoting goods or services in order to meet consumer needs and make profit.
However, marketing efforts are becoming more expensive, and their effectiveness is declining due to the high information richness of the consumer environment. Promotion specialists are trying to come up with new ways to reach the target audience, so there is a technology of cross, co-marketing or cross-marketing. Its essence lies in the accumulation of efforts to promote several companies within a single communication program. Two or more producers of goods or services in one advertising campaign affect the general target audience.
The history of cross-marketing
Cross-marketing, as a special technology of promotion, arises in the 90s of the 20th century, when traditional methods of sales bring less and less results or require more and more investments. Then large companies in the United States decided to join forces to promote goods and received a great synergistic effect. So the concept of cross promotion or cross-marketing was born, which very slowly took root in the commercial sphere, but at the beginning of the 21st century it became a familiar technology for advertising some goods and services. Today, this technique is poorly studied from the point of view of theory, but practical experience allows us to say that it has its undoubted advantages.
Cross Marketing Benefits
Thinking about who and how to conduct cross-marketing, it is worth identifying the main advantages of this promotion method. The most obvious benefit of collaborative promotion activities is to save your advertising budget. The consumer receives double benefits, therefore, with great pleasure responds to offers.
All this not only reduces costs, but also enhances the effectiveness of communication. Another advantage of cross-marketing is the possibility of wide coverage of the target audience and access to new segments. Since each partner company enters into advertising activity with its target audiences, the recipients expand due to the partner’s audience.
When finding a worthy partner, cross-marketing can significantly improve your image, increase customer loyalty, and increase the number of consumers aware of the brand. Cross-marketing campaigns cause more confidence in the client, he transfers part of the ideas about a well-known company to his partner, thereby improving the image of this company. The consumer forms associative relations of partner companies, this greatly simplifies the storage of information and gives a greater psychological effect.
Types of Cross Marketing
Co-branded advertising campaigns are traditionally divided into:
- Tactical. Those that are limited in time and solve short-term problems. These usually include one-time affiliate promotions.
- Strategic. Long-term, versatile cooperation between partner firms. It allows you to solve various problems, including in the field of image-making and branding.
Cross-cultural marketing is also distinguished as a form of promotion in international markets. In this case, the resources of two or more countries are combined to advertise products. In its pure form, such an advance cannot be called cross-marketing, since cooperation is conducted within the framework of one brand. When collaborating with different countries, it is necessary to take into account cultural and linguistic differences so that the product receives the correct semantics in the new region. Often, to translate in other countries, it is not enough just to translate advertising texts. Often, it is required to develop new packaging and sometimes even change the name so that the image of the product is positive.
You can divide cross-marketing activities by the distribution of roles between partners. They can be equal in rights and then their common efforts can achieve higher goals. For example, a company promoting an expensive brand of kitchen furniture may partner with a well-known brand of built-in appliances. The second option is an unequal relationship, when one brand is much more famous than a partner brand. In such cases, the contract is concluded in such a way as to balance the situation and distribute the benefits in accordance with it.
Conditions for applying cross-marketing
Joint marketing activities require the observance of special conditions for promotion activities to be successful. The co-branded advertising campaign program is influenced by the objectives pursued. Already proceeding from them, a promotion concept should be developed.
Thus, strategy and tactics determine cross-marketing. Examples, conditions that are taken into account, can be divided into two groups: from the initiator and from the partner. The initiator should have a good idea of the image of the partner and his target audience. The partner, in turn, should see the benefits and advantages of cooperation.
When planning a cross-marketing campaign, you should make sure that the target audience of the partners overlap, but do not coincide completely. Offered products should also have common ground, ideally, to satisfy some common need. For the consumer, there should be some benefit from participating in the action, for example, he receives a discount or a gift. Partner products must be in the same price segment. You should not conduct a cross-marketing campaign, for example, for Mercedes and any water from the village of Penkovo. The quality and level of goods must match each other.
The main forms of cross-marketing
Cross-marketing can be presented in three main forms:
- Joint advertising campaign of partner products. In such events, partners act as equal customers of advertising. For example, the Coca-Cola brand conducted a co-branding campaign with McDonald's under the slogan “Tasting Together.”
- Joint bonus or discount programs. In such campaigns, the client, using the services of one company or buying one product, receives discounts or bonus points on products of another brand. For example, Aeroflot issued a joint card with Sberbank, which accumulated points for transactions.
- Joint BTL events. A tasting, celebration or promotion can be carried out by two or more campaigns.
Cross marketing technology
Like any marketing event, co-branding companies require a certain sequence of actions. Cross-marketing usually involves the following steps:
- definition of goals: as in any marketing event in co-branding, you need to understand what should be the result;
- selection of partners: a very important and crucial stage, which requires separate consideration;
- preparation for the event: at this stage it is necessary to determine the resources, conduct motivational procedures for the staff;
- development of a cross-marketing event plan and its coordination with partners: it is necessary to determine such campaign parameters as the volume of databases to exchange, the frequency of actions, campaign periods, fines and bonuses, developing a campaign scenario, determining who is responsible for implementing the plan;
- implementation of a cross-marketing campaign;
- summarizing and evaluating the effectiveness of activities.
Search and evaluation of partners
Cross-marketing, partners in which play a key role, is based on the following principles:
- partners should not be competitors;
- goods also should not compete with each other or replace each other, it is desirable that they are complementary;
- partners should overlap in target audiences;
- goods must be in the same price segment.
Search for a partner is a very important and crucial stage in co-branding. Evaluate a potential partner by the following parameters:
- real image, it must correspond to the level of the initiating company;
- the presence of a common target audience;
- the presence of loyal consumers;
- fame;
- marketing activity.
This information will help you find a potential partner for cross-marketing campaigns.
The use of cross-marketing in various fields
Cross-marketing is not suitable for all products and fields. So it is difficult to imagine it in the B2B field, mainly such campaigns are designed for the end user. Such measures are very effective in the segment of premium goods and services, provided that a partner is found at the proper level.
Such campaigns in the promotion of food and various services are excellent. Most often today you can see the application of this technology in the restaurant, banking, insurance and tourism sectors, in the promotion of cars, clothes, household appliances.
Sociologists estimate that the 500 largest companies in the world over the past 10 years have entered into more than 60 different affiliate programs. This contributes not only to joint advertising campaigns, but also to the release of new products.
Cross-Marketing in Tourism: Limitations and Opportunities
Cross-marketing, examples of which can be found in the field of tourism, today is becoming a very popular technology. Co-branding in this field of service delivery is possible at all levels. For example, when promoting air tickets, you can combine efforts with search and reservation services or transfer services to the hotel.
Travel agencies very well combine with insurance companies, providing the client with a better service and enhancing each other's image. Difficulties in applying cross-marketing in tourism arise in finding a reliable partner. Today, customers trust travel agencies with great caution, so you should only cooperate with trusted companies.
Worldwide Cross Marketing Experience
Cross-marketing, the proposals of which can be found in various fields, already has a long history. For example, a rather long and effective relationship has developed between the Sheraton hotel chain and Lufthansa Airlines. An interesting move was invented by Procter and Gamble by launching a co-branded advertising campaign for Bosch washing machines and Calgon laundry detergents. The combined efforts of air shows, credit and insurance organizations have already become classic in cross-marketing.