By Jahnavi Singh
Co-branding is a marketing approach that utilizes the synergy of joining two well-known brands to create a third, distinct branded product.
Co-branding is a powerful activation that encourages both firms to collaborate rather than act alone. It enhances each brand's reach, visibility, and sales potential by catching potential customers.
Co-marketing refers to when two different brands promote several items through a joint campaign, as opposed to co-branding, which refers to when companies collaborate to produce a new, unique product. The strategy focuses on communications in this case. Companies will seek to synchronize their messaging to catch the target audience's attention.
When forward-thinking brands contemplate co-branding vs. co-marketing, the most important factor to consider is how they can improve their market position and how much time and money they are willing to put into it.
When firms commit to each other and cross-promote current products or services, co-marketing is effective.
A co-branding initiative can produce outcomes and income and be a win-win for each partner in situations when businesses want to convey a deeper connection and develop a new, attractive offering.
Co-branding is the collaboration of two or more independent companies on a new product or service. Co-branding partners with similar beliefs, missions, and cultures are the most successful. Co-branding partners pool resources such as in-house experience, technical advancements, and financial resources. Co-branding frequently results in a new product or service with its own brand name or logo.
If the co-branding strategy is a success, it may result in improved profitability, good connotations, and a wider consumer base for the partners. Co-branding initiatives that fail may not generate revenue, but the risk is shared among all partners, reducing each company's individual loss.
The advantages of co-branding
Co-branding can benefit everyone involved, including the customers who buy the items or utilize the service. Here are a few of the most noteworthy business benefits of co-branding:
· Customers from hitherto untapped demographics have been added to the consumer base.
· Improved product quality because of increased sales
· Obtaining a royalty income
· Customer loyalty has improved.
· Brand recognition has improved.
· When partnered with the correct partner or initiative, you gain more credibility and respectability.
· Financial burdens for marketing, technology development, and promotional events are shared.
· Revenue from jointly developed technology
· Risk is shared among all partners.
Types of Co-Branding strategies:
· Ingredient co-branding
· Same company co-branding.
· National to local co-branding.
· Joint venture or composite co-branding.
· Multiple sponsor co-branding.
Some of the examples of Co-Branding are:
Taco Bell and Doritos: The new Doritos Locos Taco was created because of a Doritos ingredient co-branding collaboration with Taco Bell, and it sold over 100 million units in its first ten weeks. The alliance is still going strong, with both parties reaping the rewards.
Starbucks and Spotify: Campaign for Co-Branding: A One-of-a-Kind Music Ecosystem.
Starbucks used music to create an atmosphere surrounding its coffee as it grew from a small, high-end coffee shop to a large global brand. Spotify, a music streaming service, has accounted for nearly 25 billion hours of listening worldwide. Starbucks and Spotify have formed an unusual co-branding collaboration to create a "music ecosystem," allowing musicians to reach more Starbucks customers while also giving Starbucks access to Spotify's vast discography.
Starbucks employees receive a Spotify premium subscription as part of the project, allowing them to construct playlists (which customers may access via the Starbucks Mobile App) to play throughout the day in the store. This music ecosystem is intended to increase Starbucks' well-known coffeehouse environment while also providing musicians with more exposure to Starbucks customers.
Pinterest and Levi's: Levi's Styled Co-Branding Campaign
Levi Strauss & Co., one of the world's oldest and most well-known jean manufacturers, recently partnered with Pinterest, a social media platform where users may pin posts they like to their profiles.
Pinterest is a popular source of fashion inspiration, so a co-branding collaboration with Levi's is a perfect fit. Styled by Levi's is a new venture from Pinterest and Levi's that provides a "custom styling experience," or style insights suited to each user's preferences and tastes.
In an increasingly digital environment, the alliance provides a true and personalized brand relationship, which is tough to come by. Levi's has a major social network with millions of users who are interested in visual offerings, and Levi's addresses these needs through digital personalization and visual-focused boards on Pinterest.
Jahnavi Singh [PGDM]
AirCrews Aviation Pvt. Ltd.
By Jahnavi Singh