Co-branding refers to several different marketing arrangements:
Co-branding, also called brand partnership, is when two companies form
an alliance to work together, creating marketing synergy. As described in
Co-Branding: The Science of Alliance: Co-branding is an arrangement that
associates a single product or service with more than one brand name, or
otherwise associates a product with someone other than the principal
producer. The typical co-branding agreement involves two or more companies
acting in cooperation to associate any of various logos, color schemes, or
brand identifiers to a specific product that is contractually designated for
this purpose. The object for this is to combine the strength of two brands, in
order to increase the premium consumers are willing to pay, make the product or
service more resistant to copying by private label manufacturers, or to
combine the different perceived properties associated with these brands
with a single product. Intent
According to Chang, from the Journal of American Academy of Business, Cambridge,
there are three levels of co-branding: market share, brand extension, and
global branding. Level 1 includes joining with another
company to penetrate the market Level 2 is working to extend the brand
based on the company's current market share
Level 3 tries to achieve a global strategy by combining the two brands
Forms There are many different sub-sections of
co-branding. Companies can work with other companies to combine resources and
leverage individual core competencies, or they can use current resources within
one company to promote multiple products at once. The forms of co-branding
include: ingredient co-branding, same-company co-branding, national to
local co-branding, joint venture co-branding, and multiple sponsor
co-branding. No matter which form a company chooses to use, the purpose is
to respond to the changing marketplace, build one’s own core competencies, and
work to increase product revenues. One form of co-branding is ingredient
co-branding. This involves creating brand equity for materials, components
or parts that are contained within other products.
Examples: • Betty Crocker’s brownie mix includes
Hershey’s chocolate syrup • Pillsbury Brownies with Nestle
Chocolate • Dell Computers with Intel Processors
• Kellogg Pop-tarts with Smucker’s fruit Another form of co-branding is
same-company co-branding. This is when a company with more than one product
promotes their own brands together simultaneously.
Examples • Kraft Lunchables and Oscar Mayer meats
National to local co-branding occurs when a local small business teams up
with a national brand or network to target local audiences and interests.
Examples: • Visa co-branding credit cards with
local retailers • Auto manufacturers with local dealerships
Joint venture co-branding is another form of co-branding defined as two or
more companies going for a strategic alliance to present a product to the
target audience. Example:
• British Airways and Citibank formed a partnership offering a credit card where
the card owner will automatically become a member of the British Airways
Executive club Finally, there is multiple sponsor
co-branding. This form of co-branding involves two or more companies working
together to form a strategic alliance in technology, promotions, sales, etc.
Example: • Citibank/American Airlines/Visa credit
card partnership Examples
An early instance of co-branding occurred in 1956 when Renault had
Jacques Arpels of jewelers Van Cleef and Arpels turn the dashboard of one of
their newly introduced Dauphines into a work of art.
A successful example of co-branding is the Senseo coffeemaker, which associates
the Philips made appliances with specific coffee brand of Douwe Egberts.
Other examples include the marketing of Gillette M3 Power shaving equipment with
Duracell batteries. Co-branding can be between an
organization and a product also. An example of co-branding between a charity
and a manufacturer is the association of Sephora and Operation Smile: Sephora
markets a product carrying the logo of the charity, the consumer is encouraged
to associate the two brands, and a portion of the proceeds benefit the
charity. A very unique case is the McWhopper
proposal, a co-branding attempt between two direct competitors, Burger King and
McDonald's. See also
Brand alliances Business partnering
Marketing co-operation Colocation
Store brand Brand
Marketing Cross-promotion
Further reading Kalafatis, S., N. Remizova, D. Riley and
J. Singh, “The Differential Impact of Brand Equity on B2B Co-branding,”
Journal of Business and Industrial Marketing, Vol. 27, Issue 8, p 623-634.
Litvinov, Nikolai. Hi-level Cobranding Identity. — 2007. — №13(4). — P.96-105.
Singh, J., S. Kalafatis, and L. Ledden, “Consumer Perceptions of Cobrands: The
Role of Brand Positioning Strategies,” Marketing Intelligence & Planning, Vol.
32, Issue 2, p 145-159. Wei-Lun Chang, “A Typology of
Co-branding Strategy: Position and Classification,” Journal of American
Academy of Business, Cambridge, Vol. 12, No. 2, March, pp.220-226, 2008.
References