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Passive income is revenue that an individual or a company generates without actively working for it on a regular basis. Make no mistake, it can sometimes take a great deal of upfront effort to generate passive income. But once the initial lift is completed, little to no active effort is required for that revenue to keep coming in on an ongoing basis. This makes it a really attractive method of earning revenue, especially over time.
Partnerships provide companies with an opportunity to generate this kind of passive income. For example, an agency may generate revenue (very actively) by working on client projects. But if they also sell software subscriptions on behalf of vendors, and that vendor offers them 15% of the monthly recurring revenue (MRR) of customers they sold to, then the agency will receive a nice chunk of passive income each month.
Example: With passive income from partnerships rolling in every month, marketing agency CEO Lissandra can feel confident that she could still pay all employees, even in dry months without a lot of new clients.
A partner ecosystem is a network of businesses who serve similar audiences but are not competitors and may thus benefit from collaborative marketing and sales strategies. For example, a marketing automation platform (MAP), a video marketing platform, and a content management system (CMS) are three businesses who target similar customers and would benefit from joining or creating a network together.
By co-marketing and even co-selling in strategic partnerships, companies can sell more products and support happier customers who have a suite of complementary tools at their disposal. Partner ecosystems help businesses serve their customers’ needs in ways that they can’t necessarily do themselves through their own technology. By recommending trusted products that fill functionality gaps, companies can set their customers up for greater success, and of course, greater retention and customer lifetime value (CLTV.)
Example: The Quickbooks partner ecosystem contains hundreds of companies — mostly technology vendors — who serve small businesses.
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A customer loyalty program is an organized system that allows a company to reward customers for their engagement. The company may offer incentives to customers who promote their brand on social media and in real life, refer business, and perform other activities that are beneficial to the brand. In return, the customers may receive points, swag, conference tickets, gift cards, or other rewards.
Many B2B software vendors understand that their customer base is one of their greatest untapped marketing and sales resources. By encouraging happy customers to share their positive experiences with their peers, vendors can leverage customers as a low-cost, highly effective marketing channel. For example, customers may receive points that can later be redeemed for rewards by referring new business. Or customers may receive cash incentives when they generate new deals that close.
Also known as customer advocacy programs.
Example: As ChamomileCorps’ #1 fan, Refika told all her entrepreneurs friends that the software was a must-have and had saved her a great deal of time and money. Since she received 500 points on ChamomileCorps’ Cham-pions program for every referral, by the end of the year, she had received enough points to redeem them for a brand new iPad.