With rising customer acquisition costs, strategic partnerships are emerging as a smarter, more efficient way for brands to connect with audiences and drive growth.

When Merit Beauty approached Completedworks with a collaboration proposal, founder Anna Jewsbury had doubts. Why would a jewelry brand partner with a beauty company? Yet the collaboration led to a unique campaign that attracted both brands' audiences. It also highlighted a growing trend: strategic partnerships as a smart, cost-effective growth strategy.  

The Backdrop: Rising Customer Acquisition Costs

Amid rising costs, we've seen partnerships shine. Customer acquisition costs (CAC) have seen a sharp increase over the past few years, signaling a major shift in digital advertising’s role for brands. By 2019, warning signs emerged as paid digital ads began to lose their efficiency. The situation worsened in 2021 with Apple’s iOS 14.5 privacy updates, which severely limited user tracking. This change saw targeting precision drop, forcing brands to spend more on digital ads with lower returns. Reports show that Facebook ad costs alone spiked by 47% in just six months following these changes, leaving many brands scrambling for effective alternatives.

For emerging brands like Petite Blume and Merit Beauty, these economics make digital advertising nearly untenable. Competing for ad space against larger companies with deeper pockets means smaller players must spend more to achieve the same reach. Many brands are shifting their focus to other platforms such as TikTok, Pinterest, and YouTube. eMarketer predicts TikTok’s ad revenues will grow by 36% annually through 2024, compared to just 2.6% for Facebook during the same period. Strategic partnerships have also emerged as a creative alternative—authentic, scalable, and far more cost-efficient.

Partnerships: A Smarter Alternative

Next year, luxury sleepwear brand Petite Plume is expanding into home and hospitality with lifestyle collaborations. Now in its ninth year, the company is a profitable, eight-figure business—and collaborations are central to its growth strategy. They’re likely to close the year at an 80% increase in revenue to last year.

One of the reasons these lifestyle partnerships among brands have taken off is because they are a relatively low-cost customer acquisition play. By leveraging existing customer bases, brands can grow organically without relying on pricey digital ads. And the benefits go beyond just cost savings. 

As marketing expert Julia Atkins noted, “There’s so much content pollution out there; partnerships enrich social media while also driving commerce.”

Compared to traditional advertising, these partnerships are far more cost-effective. While a single Instagram ad campaign can cost $20,000 for a mid-sized brand, many partnerships require little more than product samples, shared assets, or joint marketing efforts.  

For brands like Petit Blume and Petite Plume, the formula is simple: partnerships provide scalable, low-cost ways to reach new audiences and reinforce brand positioning.

What the Critics Say

Still, partnerships are not without their challenges. Skeptics often question whether collaborations risk diluting a brand's identity—particularly for premium or niche players. For Merit Beauty, the brand’s jewelry collaboration raised eyebrows, with critics wondering if the move might alienate its core beauty audience. Merit Beauty has 550,000 Instagram followers, 213,000 TikTok followers, and confirmed $100 million in sales for 2023, as per Glossy. Missteps in collaborations could risk their strong brand positioning. 

Poorly executed collaborations—those that clash with brand values or stray from customer expectations—can indeed backfire. They risk confusing audiences, damaging reputations, and quickly feeling “gimmicky or forced”, as Emily Quehe noted.

Yet Merit Beauty’s approach exemplifies how brands can sidestep these pitfalls. They prioritized partnerships rooted in shared values and creative alignment, allowing them to connect with their audience while expanding their brand vision. As one partner put it, “There’s a similarity with jewelry, makeup, and fragrance—it’s intimate. You put it on, and it acts as armor. So when Merit came to us with the idea to design some earrings, it made so much sense.” 

Merit Beauty’s success proves that collaboration can strengthen brand identity when partnerships are rooted in shared purpose and careful planning.

The Future of Brand Strategy: Partnerships Lead the Way

The success of collaborations like Merit Beauty and Petit Blume underscores a vital truth: growth doesn’t have to come at the cost of authenticity. By prioritizing thoughtful partnerships, brands can build meaningful connections, reduce acquisition costs, and adapt to an increasingly complex marketplace.

For founders like Anna Jewsbury, the initial skepticism around collaborations transformed into a lesson in the power of partnership: sometimes, it takes a leap of faith to find new ways to grow.

If you’re uncertain about whether a strategic partnership could be the right path for your brand, let’s connect.