Joint Marketing Agreement: Everything You Need to Know
A joint marketing agreement is a legal contract used to govern instances where two or more companies collaborate on marketing and promotional efforts.3 min read
A joint marketing agreement is a legal contract used to govern instances where two or more companies collaborate on marketing and promotional efforts. This allows them to get a larger return on their investment of time and money. Joint marketing agreements are often used to promote a product, event, or specific content.
The Basics of a Co-Marketing Agreement
When entering into a joint marketing agreement with other businesses, an agreement can help prevent misunderstandings and protect your interests by detailing specific terms and conditions. This type of collaboration is most common among businesses that share an audience. A co-marketing agreement is appropriate when:
- You want to make your products available for sale at the online or brick and mortar store of another business.
- You want to run a joint sale or marketing campaign with another business.
The contract details how the businesses in question will share tools, materials, training, and other resources required for the joint marketing effort. Sharing the costs of advertising allows both businesses to benefit. Small business owners can often leverage their limited resources and expand their visibility by partnering with a larger company.
The joint marketing agreement is legally binding and states the benefits received and responsibilities required of each business. For example, it would indicate how brand names and logos should appear in marketing materials.
While not as specific as comprehensive marketing plans, joint marketing agreements summarize the project's strategy, end goal, deliverables, and funding sources. They focus on each party's expectations and intents. This document should indicate how much financial investment each party is making and how much work each will put in. Sometimes each of these elements will be shared equally while other times one company will do all the marketing and the other will pay for it.
It's important that all marketing efforts contain the logos of both brands so the initiative's joint nature is clearly conveyed. Done well, this type of collaboration can result in increased profit and exposure for both companies as well as lower prices for the consumer.
Content is one of the most common co-marketing efforts. Each company can contribute its creative strengths to develop an effective, engaging collaboration. Most often, the companies work together to create content that will be promoted to both of their audiences. The most effective collaborations of this kind occur when companies share a similar goal, such as increasing awareness of an issue or driving ticket sales for an event. Examples include:
- Blog posts
- Videos and live streaming
- Twitter and social media chats
- In-person and online events
In some cases, this is a good opportunity to introduce your audience to a new type of content, thus expanding your reach. Co-marketing is similar to co-branding, in which companies join forces to create an offer or product more valuable than one they could create independently. Co-marketing is often then used to advertise the result of the co-branding effort.
Drafting and Negotiating CMAs
The detail and complexity of a CMA depend on the depth and breadth of the arrangement. For example, is it a one-time collaboration or an ongoing relationship? Typically, the CMA is a stand-alone agreement that details the terms and conditions of the partnership. It should specify the term of the partnership and the procedures by which a party can cancel the agreement. Exclusivity is also a consideration, including potential exceptions to exclusivity. The agreement should delineate each party's authority to promote the products of the other party and whether there are restrictions on this authority. Detail a management and governance structure so that the appropriate procedures can be followed for a smooth collaboration.
If you need help with creating a joint marketing agreement, you can post your job on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Stripe, and Twilio.