‘X’ Marks the Spot: 3 Steps for a Successful Co-Branding Partnership

With COVID-19 causing major consumer behaviour changes, many preconceived notions about branding were challenged. Brands are forced to adopt inventive thinking to meet their consumers' ever-evolving needs and explore new opportunities to engage potential customers.

Co-branding is one such strategy – and its recent upsurge has prompted brands to consider how they can best leverage this opportunity.

What is it?

Much like marriage, co-branding entails the strategic merger of multiple brands, typically two, into a newly branded product or service.

While co-branding has been extensively researched, its success variables remain unclear. In this article, we will discuss the idea of co-branding and the factors to consider when establishing these partnerships.

Why do brands do it??

If you are having trouble deciding if co-branding is right for you, here are the top three reasons why global conglomerates such as Apple and Nike collaborate:

#1 Establish Relevance

While entering a new market may be challenging, brands can concurrently strengthen each other's market positions through coalitions.

OMEGA x Swatch's Bioceramic Moonswatch?exemplifies this by highlighting the latter's competitive pricing in a bid to broaden public accessibility and resonance to "high-end" watches.

#2 Widen Brand Reach

Additionally, co-branding can increase a business's exposure/traction in otherwise inaccessible markets.

As this strategy seeks to support businesses in gaining more followers, and more importantly, views;?Parlov's conditioning theory?suggests that much to the success of Shopee and Pizza Hut, an increased presence may enable brands to transition from a customer's inept set into their consideration set, and ultimately become top-of-mind.?

#3 Resource Sharing

Because campaigns are often resource-intensive, co-branding enables brands to increase their individual capacity by conserving resources (i.e., time, money, manpower).

What to Consider

Co-branding can be advantageous when executed correctly. Here are 3 steps to consider, with noteworthy examples:

Step 1:?Discover your Purpose

To start, we should first identify the objective of the brand. For example, is there a market/brand gap we are looking to fill?

Only when there is a clear message and strategic direction, can the two brands gear themselves towards a shared goal/purpose.

The?fishbone diagram?and the?Strength, Weakness, Opportunity, and Threat (SWOT) analysis?are two possible tools to help you and your brand determine your objectives.

Step 2:?Find the Right Partner

Working with a brand that does not complement your brand identity could be damaging. But when two parties collaborate to create new value, having a good partner can give your brand a competitive edge.

For instance, BMW and Louis Vuitton joined forces to contribute their diverse values and expertise to promote the campaign's key message: the Art of Travel, giving rise to new possibilities. While they are not overtly aligned brands, they are complementary to their target audiences.?

Still undecided on which brands to collaborate with? Ask your audience!

Step 3:?Choose the Right Moment

Like any business decision, co-branding carries risk. It can fall prey to poor communication, misaligned values, and even poor execution, derailing a once successful collaboration; citing Shell x Lego's partnership.?

While the partnership initially made sense in the 1960s, Lego grew to become a brand renowned for energy efficiency, contrary to Shell's reputation of being an oil giant. With pressure from Greenpeace in 2014, their 50-year partnership ended. While unfortunate, situations like this serve as a reminder to stop, reflect, and reassess. In certain cases, shelving a campaign until a more apt time, such as a milestone anniversary, can assure its success.

By keeping the aforementioned in mind, brands could further enhance their brand experience by bringing it to life. Whether it surrounds a theme, products, or season, a pop-up series much like the?Adidas x Gucci Pop-up?can generate real buzz and exposure, making it a sure-fire approach to greater success.

Conclusion

With an essentially universal application, you are only limited by your imagination. Just consider the whopping (pun intended) impact the McDonald's x Burger King collaboration had on paediatric cancer.

About the writer        

Written by Angela Chen. A Social Strategist Intern at GOODSTUPH, Angela has an intense fear of heights. Thankfully, she is short.

Information is accurate as of 27 July 2022.