Co-branding is a strategic partnership between two or more separate entities to market products and services. Co-branding has stretched into almost every industry imaginable. The advantages of co-branding are beefy. The resources behind what each brand could bring together are certainly greater than what could be afforded alone.
Co-branding is certainly not a new concept and it is something that many consumers may take for granted these days but they remain an excellent way of introducing the company’s products to the loyalists of another. There are also significant cost savings to be had when times are tough. Sharing license costs and even physical spaces (buildings etc.) is great for business and the end consumer. A successful co-branding strategy can even push itself into new markets depending on it’s uniqueness and offering.
There are largely four co-branding strategies of interest, very briefly:
- Market penetration – Maintain the horizontal convergence of two companies. Share resources, build capability and share the benefit. (BMW and Mini Cooper).
- Global brand strategy – Serve existing customers with an existing co-brand in new markets (take advantage of convergence). This is especially true in spaces relating to telecommunications.
- Brand re-enforcement strategy – A decision is taken by two organisations to use a new co-brand in an existing market, deviate somewhat from the original brand names. This can be viewed as a more risky approach.
- Brand extension strategy – Utilizing a new co-brand in a new market. possibly uncharted territory, existing strong competitors.
Read more on how to select a co-branding partner, benefits and drawbacks.
What other co-branding partnerships are you aware of? Have they all been a success story? Would you follow a brand to the ends of the earth irrespective of who they partner with?
“You can’t do today’s job with yesterday’s methods and be in business tomorrow” – George W Bush