Wikipedia defines Co-branding as a marketing strategy that involves strategic alliance of multiple brand names jointly used on single product or service. Co-branding, also called brand partnership, is when two companies form an alliance to work together, creating marketing synergy.
Co-branding is basically combining the strengths of 2 brands to reap more profits or expand market potential. While this is a popular business practice in the offline market, it is not yet fully embraced as part of online marketing. It is very useful if both businesses serve the same target market with complementary needs.
Here are some examples of successful co-branding examples:
GoPro & Red Bull: “Stratos” – Since both these brands aspire to an adventurous lifestyle, it makes perfect sense to co-brand and promote each other.
Pottery Barn & Sherwin-Williams – A furniture store and paint company co-brand to promote each other’s products because they make logical sense.
BMW & Louis Vuitton – The is a great pairing since both these brands are luxury brands and both cater to the travel business. So Louis Vuitton created a custom set of luggage pieces for the new BMW i8 launch to fit into the back truck.
Uber & Spotify – These two unlikely partners tied to offer “a soundtrack for your ride.” while customers were waiting for the Uber ride and during the ride.
Alexander Wang & H&M – Although these two brands do not fall in the same positioning sector and cater to different audiences, H&M traditionally would partner with high end luxury brands to offer their customers some thing that they can aspire to while high end luxury brands such as Alexander Wang can expose their brand to a whole new set of customers.
A classic example of co-branding is the tandem Gillette M3 Power shaving equipment with battery brand Duracell. A recent example of co-branding is the combination of an express coffee shop Jo To Go and Mexican grill drive-through store Taco Flamingo. The outcome is a one-stop coffee and Mexican food drive through store aimed to serve orders in less than 2 minutes.
How Co-branding Can Help Your Startup Business?
- Explore and capture untapped categories or niche – if you are co-branding with a brand in a completely different market segment, then you would be reaching audience in that sector and introduce your brand to them which will dramatically expand your target audience.
- Expand reach to new customers – this is a great way to reach new customer who are loyal to the other brand and now by association will come to trust your brand
- Higher sales revenues and royalty income
- More efficient operations when sharing best practices
- Better exposure or coverage because of joint advertising initiatives
Implementing Co-branding Online
Co-branding remains underutilized in the online business but it can be profitable when done properly. The idea is to deal with another product or service relevant to your target market. More importantly it must add value to your customers.
An online real estate logos firm, for instance, can team up with a mortgage firm. Why? Life’s experiences tell us that anyone who’s interested in buying a new house or property usually considers the paying options. Striking a deal with a mortgage site will help customers understand their options better and save their time from checking other different sites.