What if the success of your brand depends, in part, on another brand? No matter how tight the relationship might seem, it’s always subject to change.
All-time brand titan, Procter & Gamble, has had a long and fruitful partnership with Wal-Mart. But last year, P&G’s ubiquitous Tide suddenly found itself jostling for space on Wal-Mart’s shelves next to Persil, a higher-end European competitor, threatening a relationship that accounts for a fifth of P&G’s sales.
Truly, e-commerce is biting big box hard, and—just like any committed relationship—retailers are asking their supplier partners to share the pain. Witness Woolworth in Australia, which in 2014 demanded its Tier B suppliers cough up as much as 1.5 per cent of annual turnover in a single payment, to make up for a shortfall in sales.
Other partnership pangs are evident. Wal-Mart has also gotten in a spat lately with Visa, and stopped accepting it in Canada. Meanwhile, Costco decided last year to end its 16-year relationship with American Express after the firms couldn’t agree on card fees, turning to Visa instead. The right partnership can boost sales better than Bogey and Bacall, or can fail like Kim and Kris. Are your brand partnerships an enduringly good fit, ready to bolster both your fortunes in an uncertain future?