Nov 19, 20193 min read

Here’s Why Online Retailers Need to Have Cool Friends.

Peter Grensund headshot

by Peter Grensund

In the Amazon and Super-Brand era, smaller e-commerce players need to play a heads-up team game to stay competitive. Partnering with strong brands and companies that bring smart solutions to your core operation will arguably be an important factor for success.

As a partner to merchants, Klarna delivers a lot more than payment solutions. It’s a well-known consumer brand with 70 million shoppers globally, an app and with unrivaled purchase experience, and a guarantee for safe and prompt payments. But, argues Mikael Oldebäck, Senior Marketing Manager at Klarna, it’s also a business to business brand willing to ”exceed expectations”. This means, with Klarna you’ll get a partner who’s determined to attract more customers, drive sales, and make your customers happier than ever. In other words, innovate throughout the full shopping experience.

There are many official business partnerships out there. High-profile brand collaborations like Spotify and Starbucks, or Red Bull and GoPro come to mind. The obvious aim is that the brands strengthen and support one another; a win-win for both parties.

The same type of thinking – but with fewer dollars spent on advertising – can be applied by the rest of us as well.

“I believe the e-commerce business chain is increasingly being looked upon as a joint venture,” says Mikael Oldebäck. “More and more retailers are partnering up with other businesses to deliver a competitive shopping experience for their customers. It is almost considered a must if you want to be competitive in a world of tech-giants.”

The overall trend within e-commerce at the moment is the segmentation of different functions. The e-commerce platform is owned by A, the order management system is run by B, maybe Klarna provides your checkout and payments, then there is the transport management system, and so on.

“I can imagine that the infrastructure around having an online store can feel overwhelming for individuals who enthusiastically entered the online retail space with an ambition to ‘sell great products to great customers’. All of a sudden they’re instead coordinating a complex IT project.”

How do you profit from having cool friends?

Think of it like this instead:

All these segments are potential beneficial partnerships. Every link can add value to the overall customer experience and make your e-commerce chain stronger. The obvious pros:

  • Access to companies that can solve specific problems for you or your customers
  • Strong external brands can boost your own brand and increase awareness
  • Your offering becomes more relevant to your customers

Mikael Oldebäck highlights two smart logistics companies, Budbee and Urb-it, the latter providing sustainable deliveries in larger cities, i.e. through walking, biking or using public transport. By carefully selecting partners, he argues, you give yourself an opportunity to zone in on topics important to your brand and your customers. Whether it’s cutting pollution, offering fast and convenient payments, or making home delivery less annoying, your choice of partners says a lot about you.

“The most important aspect to consider before partnering up with somebody is to make sure that your goals are aligned. Does the partner company really have a business model that means that your success is also their success? Is it good for their business that your customers are happy at all times? Are they truly committed to providing you and your customers’ outstanding value? If the answer is yes to all of these questions, it might be a match made in heaven.“

Join the inner circle

Another way of understanding the mechanism of associating your business with strong brands and smart partners: if you hang out with the whiz kids in school you’ll soon be part of an inner enlightened circle. It’s maybe not enough to make you the smartest person in the room, but compared to the rest of the school, you look like a genius!

How do you find your partners?

  • Identify what value you need to add, what customer expectations you need to meet.
  • Identify companies wanting to “exceed expectations”, be it in logistics, payments, customer service, etc.
  • Check that they match your core values and align well with your business.