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When Is A Joint Venture, Not A Joint Venture…

…when it’s abused by uninformed marketers.

Here’s a tip: If you’re recruiting partners for a product launch, or you want to invite me to join your affiliate program, you just want to ask for help in marketing and promotion. That’s not a “joint venture”.

A joint venture is where 2 individuals or business entities are going to a deeper level of cooperation and collaboration – a prime example is my buddies Amit Mehta and Zac Johnson‘s newly-launched Magnetic Poetry Facebook Application.

There’s joint sharing and investment in product development and marketing, the partners might even form a new business entity to manage the business.

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On the other hand, if you’re looking for affiliates, you’re recruiting affiliates.

If you drop the term “joint venture” and misuse it, you lose a number of points right off the bat.

If in doubt, check out the Wikipedia definition of “joint venture

6 comments on When Is A Joint Venture, Not A Joint Venture…

  1. Andy Beard
    June 5, 2008 at 11:29 pm (4323 days ago)

    2 people working on a project together is a partnership, and if it isn’t set up as a business entity with a contract between them, it doesn’t meet your Wikipedia definition?

    In the info marketing space, I think a JV is in many ways more than a normal “affiliate” relationship with the “networks”, though often there are JVs that fit even the Wikipedia definition.

    For a start they are never anonymous, or very rarely

    Secondly there is an implied level of reciprocity – I doubt very much that Target or Amazon will promote my next product just because I have been one of their affiliates for years.

    Then of course there is very obvious problem that it is the term being used by thousands of people in one segment of the industry, and nothing is going to change that.

    Ultimately the Wikipedia definition needs to be expanded. If Americans can spell colour wrong, they are also able to establish different meanings for JV, and with the millions of people who have been exposed to that variant, it isn’t going to change any time soon.

    Reciprocal Information Product Affiliate Arrangement and Special Rewards Group just doesn’t roll off the tongue as well as JVAlert and JVNotify

    The Wikipedia definition is interesting, Rich Schefren used “Strategic Alliance” to describe what he is doing with Stompernet as beyond a normal JV deal.

  2. Andy Beard
    June 5, 2008 at 11:32 pm (4323 days ago)

    My comment seems to have appeared but there was a nasty error message.

    WordPress database error: [Table 'whoisand_wpdb1.wp_post2cat' doesn't exist]
    SELECT cat_ID AS ID, MAX(post_modified) AS last_mod FROM `wp_posts` p LEFT JOIN `wp_post2cat` pc ON p.ID = pc.post_id LEFT JOIN `wp_categories` c ON pc.category_id = c.cat_ID WHERE post_status = ‘publish’ GROUP BY cat_ID

    It looks like something hasn’t been fully configured

  3. Andrew Wee
    June 6, 2008 at 5:58 am (4322 days ago)

    Tks for pointing it out.
    It’s a WP 2.3.x DB error and I’ve got blog consultants working on resolving that.

    There’re a number of issues to be resolved before going to WP 2.5.1.

  4. Andrew Wee
    June 6, 2008 at 6:09 am (4322 days ago)

    Tks for your insights.

    For the purposes of the post, I focused on pointing out how the phrase “joint venture” had been abused, and given the intensity of engagement I’d associate with typical joint ventures, I’m pretty surprised at the number of “joint venture” proposals I receive each week.

    I’m not sure if it’s a semantic issue, maybe “joint venture” sounds nicer and more politically correct than “email promotion” or “affiliate promotion”.

    Who knows?

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    The key criterion for a joint venture is instrumental contribution by each partner contributing to the success of the joint effort. There may or may not be a formal business entity in place, a written agreement might also formalize the bond. (although I’ve done JVs with only an oral agreement in place…)

    Reciprocity is more an intangible amount of social goodwill that’s built up between partners.

    In the case of promoting Amazon or eBay offers, an affiliate is more an element in their supply chain (together with the distributor, reseller, retailer) than any type of “JV partner”.

    PS: I’d imagine any type of alliance would incorporate elements of strategy and tactics, so “strategic alliance” and “strategic profits” might make for nice buzzwords and great names for an “advanced” event, but I don’t think it conveys a whole lot of meaning.

  5. Mayank - Start Internet Business
    June 9, 2008 at 8:15 pm (4319 days ago)

    In case of the typical “JV” that you are invited to you, the originator would be creating the service/product, and you would also be instrumental in it’s success by providing exposure to it.
    Wouldn’t that qualify as a Joint Venture as per your definition?

    Think of it in another way -
    One partner takes care of the part of creating the product.
    One partner takes care of the marketing aspect.
    They really do not have to divide each task 50-50.

    Just my 2 cents.

  6. Andrew Wee
    June 11, 2008 at 2:08 am (4317 days ago)

    It would be a joint venture if the product creator wasn’t also sending out the “joint venture opportunity” to hundreds of other “partners”.

    It’d be like saying Florida’s Natural OJ had thousands of convenience stores as their “joint venture partners”.

    Whoever comes up with a definition like that should read some basics on supply chain management.

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