Importance of Co-Branding and Cross-Selling in Management
Co-branding refers to the partnership by two or more brands strategically so as to achieve mutual benefits from them. The benefits can be a halo effect or Marketing benefits. This is important because in an era where many companies are popping up with a variety of products and services all around. It is important to create a brand for the product in the market so as to increase recall and attract customers. To do this companies have to highlight their unique selling points so as to generate leads. Co-branding helps hereby collaborating with an established brand that has complementary services to your brand.
Cobranding has three main benefits to the organization that can be stated as below:
#Credibility: The credibility of the company increases when they collaborate with another respectable business. The businesses would be able to highlight each other’s assets and strengthen the position of each of them in the market.
#Extend Reach: Due to this collaboration, the businesses are getting a reach into the customers of the other business as well, thus increasing the reach of the company. This would enable a company to increase its reach into an area where they previously did not have access.
#Efficient Marketing Budget: Marketing is a costly affair and requires substantial investment. In co-branding, the Marketing budget is usually split between the parties and thus doubling the budget and again opening better opportunities for the efficient usage of the funds.
Cross-Selling whereas refers to selling a different product or service to a customer so that it increases the value of a sale. Here, if a toothbrush is sold with toothpaste, it is called cross selling. This is because a person who buys toothpaste would need a toothbrush to use it, thus the products are complementary and it increases the collective value of the sale.
For example, if AirCrews Aviation Pvt. Ltd. decided to sell a small training module on how to deal with Aviation interviews along with their Visume product, it would be an example of cross-selling.
The benefits of this can be as follows:
#Customer Loyalty: Cross-selling would be created in such a manner as to solve customers' problems and make things easier for them. This effort would be acknowledged by the customers and they would be more loyal to the brand as such.
#Improves Profitability: Cross-selling is usually done for products that are not moving on the shelf. This would also entail some discounts on the overall product which would make the profit earned lesser than the actual. But this is still increasing profitability because the expected profit on one of the products was actually zero as there was no sale expected.
#Generate Leads: Cross-selling creates better customer satisfaction and creates a word of mouth Marketing where they would suggest the same to their friends and family through referrals or any such scheme. This would in turn help in generating leads for the company
Donia Elizabeth [MBA IIM-s]
Manager Mktg [ Quiz Incharge]
AirCrews Aviation Pvt. Ltd.
donia@Air-Aviator.com
+91 94475 13699
www.portrait-business-woman.com/2021/04/donia-elizabeth-varkey.html
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