Co-branding or brand partnerships occur when two or more organisations decide to team up and work together. On many occasions this can have the potential of increasing the brand equity of the partners, but on the other hand, it can also be a challenging task when the interests, cultures and core objectives behind different brands clash.
Examples of successful brand partnerships include:
- GoPro & Red Bull
- Starbucks & Spotify
- Apple & MasterCard
Whilst the above have been successful, on the other hand, the partnership between Neiman Marcus (American luxury retailer) and Target did not go as planned. The collaboration was expected to be a huge success but consumers found the collection “ugly”, “too weird, too pretentious, too expensive” and out of line with today’s style trends.
How can we make brand partnerships work?
First of all, we have to analyse the benefits of the brand partnership we are proposing, in other words, what can we potentially get from this alliance? These are some of those benefits:
- Increased visibility and market exposure. By partnering with another brand, we may be accessing markets we have not worked in before, audiences we have not previously reached. Our brand will be more visible and the value of our company can rise as a consequence.
- Be efficient and cut costs by utilising shared resources. Both organisations can take advantage of each other’s strengths and maximise the benefit.
- Brand loyalty. You have the opportunity to build emotional connections with your customers; they can associate brands they love working together.
- More choice for our customers. It can be a great chance to offer a wider range of products and/or services to the customers, because the company has more resources.
After assessing the benefits, these steps are important to create, develop and strengthen a brand partnership strategy
- Have a clear strategy about where you stand. It is essential to analyse the connection between your organisation and your prospective partner and see what you would like to achieve as a team.
- Evaluate who you are partnering with. Take some time to do some research on prospective partners in order to identify that organisation’s reputation and any causes for concern.
- Management of activities. Guidelines should be set out in order to ensure consistency and effectiveness among the activities of the organisations involved.
- Creating an action plan. Make the most out of your alliance by creating a plan outlining each organisation’s overall strategy such as the types of customers each company would like to pursue, the markets each organisation would like to target, etc. Both companies should have a common and clearly defined strategy and work proactively towards a goal.
Although brand partnerships are often successful and increase the equity of the brands involved in them, sometimes that is not the case. The steps outlined above can help organisations make more informed decisions by identifying some of those dangers before they enter into brand partnerships or alliances.