A very interesting article in NY Times, couple of days ago, on how (co) branding and nowadays marketing strategies had changed the way music industry is running its business. It is focused especially on names and bands “whose generation embraced the anti-big-business motto â€œnever trust anyone over 30â€ in the 1960s, toots the corporate horn” nowadays.
Band branding appears to know no bounds. The Black Crowes market rolling papers, Bon Jovi offers $1,000 signed canvas art prints and MÃ¶tley CrÃ¼e peddled MÃ¶tley BrÃ¼e, a carbonated drink. Celebration Cellars, a California winemaker, teamed up with several rockers, including Bon Jovi, Kiss, Madonna and the Rolling Stones, to issue special-edition wines that feature band logos and sell for $100 or more a bottle.
branding lucre rolling in for those who do choose to indulge, some record labels are pressuring artists to share their promotional and merchandising income as a condition of getting record contracts â€” so-called 360 deals.
Co-branding (also called Dual Branding) has become a rage in the marketing arena, with companies realizing that isolation is not after all the best policy.
The markets of yesterday saw companies focusing on the customer thinking about “How can I promote my jeans?” The marketers today believe that the myopia needs to clear off to a “How do I define my customer?” approach. By saying, “defining my customer”, i don’t mean getting back to classroom and assessing who the target consumer is. Defining a customer means more in terms of creating a persona for the customer, or rather shaping the customer.
We discussed earlier that co-branding is not a new concept, and that it remains crucial to consider the strategic objectives of the project and to address all the possible risks before it is launched.
Co-branding can be an asset in nearly all aspects of marketing, from creating initial awareness to building loyalty. There are four main approaches to co-branding that companies should consider.
Co-branding began with endorsements. This approach can be a good beginning point for organizations; the relationship is simple, but it can result in significant brand enhancement and sometimes even an unplanned opportunity.
Partners in ingredient co-branding are usually the company’s current suppliers or largest buyers. Easy access to offerings and a well-established relationship translates into a lower level of investment required than in other forms of co-branding. An ingredient brand’s success relies on being distinct, either through patent protection or by being a dominant brand.
Value chain co-branding.
Other players in the value chain can create new experiences for the consumer, which, in turn, can create a level of customer value and differentiation not possible with promotional or ingredient co-branding. There are three types of value-chain co-branding:
- Product-service co-branding. This approach allows partners to share industry-specific competencies while at the same time opening previously unavailable customer bases.
- Supplier-retailer co-branding. These relationships can range from the natural to the less obvious—even to traditional rivals, which can help both partners become better positioned against well-entrenched competitors.
- Alliance co-branding. Globalization and better, broader offerings through cooperation aside, forming alliances with similar companies may be crucial for rapidly consolidating industries.
In this approach, partners create entirely new offerings to provide substantial increases in customer and corporate value. It offers the potential to grow existing markets and create entirely new ones. Because both partners are seeking a high level of value creation, the rewards and risks are often an order of magnitude larger than those created by other co-branding approaches.
Marketing goods or services under two or more trademarks of different companies is a popular way to broaden an existing or new brand’s exposure in the marketplace and can be used in many ways.
Although co-branding is not a new concept, it remains crucial to consider the strategic objectives of the project and to address all the possible risks before it is launched.