Alliances to expand into new markets are particularly useful, since independent expansion requires a huge investment of resources and forming new channels.
Both businesses need a clear understanding about what each partner is expected to do, and how management decisions will be made in cooperative efforts.
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It occurs when 2 or more companies co-operate to jointly promote and sell a product, service or even a concept.
It can take place on any scale national or international.
It can be employed by any business when it finds partners interested in mutually beneficial co-operation.
It involves pooling of resources.
Alliances of non-competitive businesses. e.g. car-rental business.
Destination alliances, where hotels, restaurants, and tourist businesses pool resources to market their location to prospective travelers.
Technology alliances often are formed to promote a new device or concept.
Alliances to expand into new markets are particularly useful, since independent expansion requires a huge investment of resources and forming new channels.
Companies usually trade loyal customers, increasing business for both members of the alliance.
The marketing team identifies the business opportunity that could potentially be met through an alliance.
Considering an international alliance, additional research must be conducted on the other country’s economy.
Both businesses need a clear understanding about what each partner is expected to do, and how management decisions will be made in cooperative efforts.
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