Co-Branding the State of Art



Due to the fierce competition between manufacturers and retailers in a saturated market, especially for FMCG, the use of co-branded products has become more and more important for brand managers in recent years. In addition to classic brand extensions and other brand alliance strategies, such as advertising alliances and dual brands, co-branded products provide a way to differentiate products in a competitive environment. Through the physical integration of the product, a product is branded, that is, it is recognized with two other brands at the same time, and the company can obtain a positive influence for these two products. Therefore, compared with other forms of brand alliances, the physical integration of products is an indispensable component and differentiated standard for co-branded products.

Co-branding is a long-term strategy in which products are branded and identified under two brands at the same time. According to this definition, the following characteristics consist the overall product: First, the participating brands must be independent before, during and after proposing a joint product. Second, branded companies must consciously pursue their alliance strategy. Thirdly, the collaboration between the two brands must be visible to potential buyers, and lastly the product must be matched with the other two brands at the same time.

An advertising affiliate strategy is closely related to a brand's affiliate strategy. As with any branding strategy, the main reason for using other affiliate branding strategies is to improve the overall image and profit signals working with additional affiliates. According to the theory of signs, the combination of the two brands gives consumers more confidence in the quality of the product, which leads to higher product reviews and higher prices. However, co-branding is the only approach where one product consists of two or more brands at the same time. Other brand affiliate strategies can avoid the severity and reduce the complexity of negative spreads, but the benefits of this strategy may not be as strong as other brands.

There are two popular types of co-branding you can consider:

  • Ingredient co-branding. This is a situation where a well-known brand is promoted with a less well-known brand. The purpose is to help the less well-known brand gain recognition. When you want to focus on the market You can use this type of co-branding when attracting non-known brands. When consumers search for branded products, they will find unpopular products. This provides consumers with an opportunity to try lesser-known brands, thereby increasing their sales.

  • The composite co-branding jointly provides unique products or services that are highly valued by customers. This combination also allows you to create value for the brands involved.

If planned and executed properly, a good co-branding campaign can create the potential for each brand and overcome weaknesses by leveraging the strengths of another brand. For example, if one brand is known for its technical knowledge but lacks fun or creativity, and another brand has a lot of creativity but has technical limitations, cooperation can overcome the negative impact of each brand and get the best out of each of them.

A carefully selected co-branding plan can bring various benefits to each brand involved. By joining forces, brands can take advantage of each other's strengths and success, and develop their businesses by reaching out to each other's markets and audiences. The transfer of active brand association from one brand to another can even have a lasting impact beyond the co-branded association itself.

Co-branding is a useful strategy for companies that want to increase brand awareness, improve reputation and brand image, or increase sales and market share, and you don’t have to be Nike or Beyonce to succeed in brand co-branding. The joint partnership must be strategic and logical. Two brands or companies must share common values ​​or have some similarities with their image or brand identity; otherwise, you may damage the integrity of the brand.

If you are considering co-branding for your own brand, please make sure you have a complete understanding of the value and image of other brands. Determine what makes the two compatible and assess the potential risks. Understand what benefits the partnership brings to other brands, and make sure it aligns with your own activities and strategic goals. With the right combination, it can cause quite a sensation.