Branding helps a company reach new customers and retain existing ones.
Branding is the marketing process of creating a unique image for a business in the mind of consumers. According to Business Dictionary, it is done mainly through "advertising campaigns with a consistent theme." That theme should also be extended to other forms of marketing in the form of a consistent color palette, logo and tag line. Co-branding is the process of fusing two complimentary brands together in an effort to create a new, stronger brand.
Branding
A company's brand is the symbol by which consumers identify it from the competition. Strong branding allows customers to recognize a company without seeing the name. For example, when people see the yellow double arches they automatically know they are at a McDonalds. A company with a single brand has lower marketing costs because it is only responsible for promoting one brand. Additionally, all the revenue the brand generates goes directly to it rather than having to be split across two brands.
Co-Branding
Marketing resource site MarketingProfs states co-branding is when "two or more brand names function together" to create a new product. For example: Pillsbury Brownies with Nestle Chocolate or the Braun/Oral-B Plaque Remover. Co-branding allows one product to leverage two existing brands to increase sales. However, marketing costs will increase and consumers can become confused if the co-branding effort isn't handled correctly. Consumers may think one or both individual brands are going out of business. It is important to assure current customers of brand stability and focus on the benefits of the co-branding.
Choosing
When deciding whether you will co-brand or stick to a single brand, ask yourself if the second brand you are contemplating has the same target market. Also consider whether it will compliment or enhance your current brand in some way, or if it will detract attention from an already well-established brand. If you decide that co-branding will enhance your brand, you will need to consider which companies to approach about the partnership. Inc. magazine states you should consider companies that will provide additional value to your customers and who have a similar mission statement.
Committing
If you choose to co-brand your business, you have to commit to publicizing the new brand. You will need to run multiple advertising campaigns announcing the new brand. This can be paid for jointly by both companies. Additionally, the CEOs of both companies should engage in media relations where they publicly talk about the customer benefits of the new brand. This not only encourages customers to try the new product but also reassures them that the quality of the separate brands will be upheld.
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