Co Branding

CO BRANDING CONCEPT
Definition:

The term 'co-branding' is relatively new to the
business vocabulary and is used to encompass a
wide range of marketing activity involving the use
of two (and sometimes more) brands.

Thus co-branding could be considered to include
sponsorships, where Marlboro lends it name to
Ferrari or accountants Ernst and Young support
the Monet exhibition.


Kotler defines co-branding as, "two or more well-
known brands combined in an offer" and each
brand sponsors expect that the other brand
name will strengthen the brand preference or
purchase intention and hope to reach a new
audience
Investopedia
A marketing partnership between at least two
different brands of goods or services. Co-
branding encompasses several different types of
branding partnerships, such as sponsorships.
This strategy typically associates the brands of at
least two companies with a specific good or
service.

One form of co-branding is ingredient co-branding. This
involves creating brand equity for materials, components or
parts that are contained within other products.

Examples:

Betty Crockers brownie mix includes Hersheys chocolate
syrup
Pillsbury Brownies with Nestle Chocolate
Dell Computers with Intel Processors
Kellogg Pop-tarts with Smuckers fruit
Another form of co-branding is same-company co-branding.
This is when a company with more than one product
promotes their own brands together simultaneously.
Examples
Kraft Lunchables and Oscar Mayer meats

Joint venture co-branding is another form of co-branding
defined as two or more companies going for a strategic
alliance to present a product to the target audience.

Example: British Airways and Citibank formed a partnership
offering a credit card where the card owner will
automatically become a member of the British Airways
Executive club Finally, there is multiple sponsor co-
branding. This form of co-branding involves two or more
companies working together to form a strategic alliance in
technology, promotions, sales, etc.
INTENT

There are three levels of co-branding: market share,
brand extension, and global branding.

Level 1 includes joining with another company to
penetrate the market

Level 2 is working to extend the brand based on the
company's current market share

Level 3 tries to achieve a global strategy by combining the
two brands

FORMS
Ingredient co-branding:
Creating brand equity for materials, components or parts that are contained
within other products.
Examples: Betty Crockers brownie mix includes Hersheys chocolate syrup

Same-company co-branding
. This is when a company with more than one product promotes their
own brands together simultaneously.
Promotional Co Branding:.
Co-branding with persons or events. Eg Tiger Accenture
Joint venture co-branding
is another form of co-branding defined as two or more companies going
for a strategic alliance to present a product to the target audience.
Example:
British Airways and Citibank formed a partnership offering a credit
Multiple sponsor co-branding
. This form of co-branding involves two or more companies working
together to form a strategic alliance in technology, promotions, sales,
etc.

CO-BRANDING IN INDIA

Co-branded credit cards from LG and SBI, ICICI and
HPCL, Air-Sahara and Standard-Chartered Bank, HSBC
and Star India Bazaar, show that these have spread
across to all possible business sectors in India.

P&G, India, undertook a co-branding exercise with the
National Association for Blind in the form of Project Drishti
,

Benefits of Co branding

According to an article written by Juliette Boone about co-
branding, at least five reasons exist for forming an alliance:
1. to create financial benefits;
2. to provide customers with greater value;
3. to improve on a property's overall image;
4. to strengthen an operation's competitive position; and
5. to create operational advantages.

Disney worldwide has an agreement with McDonalds where
by the characters from its new films are distributed as toys
with McDonalds "Happy Meals".

Disadvantages
- If a brand has too many Brand Liabilities this can be
detrimental to the other brand.-
Customer dissatisfaction
Environmental problems
Product or service failures
Questionable business practices
Devaluation
If one partner files for bankruptcy-an unexpected challenge
Threats to operation-the partnering organizations may not be
able to work well together
-Conflict of interest if two organizations are looking to attract
the same customer, this can be detrimental to sales of one
or both partners

DMRC AND CITIBANK

India's first co-branded, '2-in-1'transit credit card

Launched in May 2008
Citibank credit card
Metro Smart card

Citibank gained through wider reach while Delhi Metro
gained by greater prospect of luring in customers who
were looking for bundled benefits

REASONS FOR SUCCESS

The reward points accumulated on this card can be
redeemed for free Metro rides

2 Reward Points for every Rs.100 spent on the Metro,

1 Reward Point for every Rs 100 spent elsewhere

Offer several benefits - exclusive shopping deals and
discounts in Delhi and the NCR, fuel surcharge
waivers(2.5%) at Indian Oil outlets.

The special "Delhi Delights" feature - unique deals from
some of the biggest brands in Delhi, including Dominos,
Fun Cinemas, Nirula's, Bercos, India Today and VLCC.


WOODS-ACCENTURE
Accenture entered into an agreement with Tiger Woods on
October 2003.
Tiger Woods' strength, mastery, discipline
and relentless focus on winning mirrored the characteristics
of a high-performance business.

Accenture used Woods to personify its claimed attributes of
integrity and high performance.

Accenture made the brand building of Tiger Woods an
equal part of their own brand building


FAILURE
Woods car crash, the revelations of third parties, marital
issues were key reasons for failure.

Accenture backed out of an endorsement deal worth an
estimated $7 million a year.

Six year investment ended abruptly on a low, negative note
rather than strategically timed graceful separation.
An early instance of co-branding occurred in 1956 when
Renault had Jacques Arpels of jewelers Van Cleef and
Arpels turn the dashboard of one of their newly introduced
Dauphine's into a work of art.
A successful example of co-branding is the Senseo
coffeemaker, which associates the Philips made appliances
with specific coffee brand of Douwe Egbert's.
Other examples include the marketing of Gillette M3 Power
shaving equipment (which require batteries) with Duracell
batteries (both brands owned by Procter & Gamble).Co-
branding can be between an organization and a product
also. An example of co- branding between a charity and a
manufacturer is the association of Sephora and Operation
Smile: Sephora markets a product carrying the logo of the
charity, the consumer is encouraged to associate the two
brands, and a portion of the proceeds benefit the charity.
Store brands are a line of products sold by a retailer under a
single marketing identity. They bear a similarity to the concept
of House brands, Private label brands (PLBs) in the United
States, own brands in the UK, and home brands in Australia
and generic brands.

But they are distinct in that a store brand is managed solely by
the retailer for sale in only a specific chain of store. The retailer
will design the manufacturing, packaging and marketing of the
goods in order to build on the relationship between the
products and the store's customer base.

Store-brand goods are generally cheaper than national-brand
goods because the retailer can optimize the production to suit
consumer demand and reduce advertising costs. Goods sold
under a store brand are subject to the same regulatory
oversight as goods sold under a national brand.