Successful Co-branding

What is Co-branding? 

The word brand comes from the old Norse word 'brandr' meaning to burn. Early humankind would brand their livestock so they could mark their ownership and distinguish their cattle from those of their neighbours. Therefore the role of branding was established, this being to identify ownership or origin (Boad et al, 2000). 

So looking at this co-branding must be the marketing arrangement where two different brands join forces to create a product or service indicative of both their identities.  This opens up an opportunities for the brand to introduce their product or service to the devotees of another brand (Stec, 2013).

Successful Co-branding 

1) Nestle

An early example of this is where Nestle bought Rowntrees in 1988 for £5 billion, which was twice the previous market capitalization of the company. Here you ask, why so much for just another sweet brand? well Nestle wanted the ownership of such famous brands as Areo, Smarties and Kit-Kat, as Rowntrees couldn't adequately exploit these brands with their lack of funds (Boad et al, 2000). 

2) Harry Ramsden's
Harry Ramsden, the fish and mushy pea restaurants, successfully broadened the public awareness of their restaurant chain by attaching their Harry Ramsden brand to the frozen food packets of the fish packers Youngs. The co- branding partnership not only increased customer recognition of the food chain, but at the same time increased the sale of the branded fish fillets too! (Blackett, 2000)

3) McDonald's: McCafe
The first version of McCafe was created in 1993 where a coffee pot was left on the counter for customers coming in at peak times, which was evolved over the next 6 years until the emergence of the brand 'McCafe' was introduced in 1999. The most important part of the co-branding function providing separate values to the respective target audiences but combining the experiences of bot brands at the point of exchange. (Wright et al, 2005)

4) Nike Air Jordan's

Nike, who already had an enormous following prior to the launch of this co-branded product, decided to capitalize on their core competency of producing superior quality footwear. They took their line of shoes to the next level by signing basketball extraordinaire (and my celebrity idol), Michael Jordan, to their label. This outran competition by offering two great things wedded into one HOT item - See more at: http://www.qualitylogoproducts.com/blog/the-art-of-co-branding/#sthash.VvAxZjvu.dpuf

Nike, who already had an enormous following prior to the launch of this co-branded product, decided to capitalize on their core competency of producing superior quality footwear. They took their line of shoes to the next level by signing basketball extraordinaire (and my celebrity idol), Michael Jordan, to their label. This outran competition by offering two great things wedded into one HOT item - See more at: http://www.qualitylogoproducts.com/blog/the-art-of-co-branding/#sthash.VvAxZjvu.dpuf

Nike, who already had an enormous following prior to the launch of this co-branded product, decided to capitalize on their core competency of producing superior quality footwear. They took their line of shoes to the next level by signing basketball extraordinaire (and my celebrity idol), Michael Jordan, to their label. This outran competition by offering two great things wedded into one HOT item - See more at: http://www.qualitylogoproducts.com/blog/the-art-of-co-branding/#sthash.VvAxZjvu.dpuf

This is seen as one of the most successful co-branding in history. Here Nike tried to capitalize on their well known image of creating the best sports shoes, by partnering with basketball legend Michael Jordan. In 2013, Nike released its 28th shoe in the Jordan line and control 58 percent of the U.S. shoe market, according to SportsOneSource.com (Penhollow,2014) Kurt Badenhausen wrote last year for Forbes.com that "The terms of Jordan’s current deal with Nike are a closely guarded secret, but royalties now generate more than $60 million annually for MJ, according to sources,and it is the vast majority of MJ's earnings".

5) GoPro & Red Bull 

Here GoPro were used by Red Bull for their marketing videos, although the two companies have never explicitly said they are linked, although it was of an advantage to both of the companies. In regards to GoPro its enabled their relatively small brand to grow much quicker and as Rao et al,1999 put it, 'the use of co-branding can influence consumers’ perceptions of a brand for which a consumer has no previous experience with'. Therefore, GoPro, by featuring Red Bull in their advertising, demonstrated their links with the extreme sports scene (in which Red Bull is a major sponsor), and that their brand values, relate in some way to those of Red Bull, which is sometimes referred to as a spill-over effect (Erevelles, et al. 2008). 

Although these examples seem like, if a company does co-branding it will be an instant success, but this isn't always the case. This can be shown where the accounting company Accenture, branded their "performance" with Tiger Woods "perfection" brand at the time to create a message of "perfect performance"(Evans, 2010). Although as we all know now in hindsight, Tiger wasn't the most perfect of sportsmen with his off the course antics and this led to Accenture having to drop Tiger and wasting $20 million on their marketing campaign. 






References
Tom Blackett & Bob Boad. Co-Branding: The Science of Alliance. [Macmillan Press 2000] Available at http://bit.ly/SCYIMm

Tom Blackett (2000) 'Co-Branding: The Science of Alliance'. European Intellectual Property Review.
E.I.P.R. 2000, 22(7), 344. Available at http://bit.ly/1l16n02

Owen Wright, Lorelle Frazer & Bill Merrilees. (2007) 'McCafe: The McDonalds co-branding experience'. Journal of Brand Management. VOL. 14, NO. 6, 44 457

Sunil Erevelles, Thomas H. Stevenson, Shuba Srinivasan & Nobuyuki Fukawa. (2008) 'An analysis of B2B ingredient co-branding relationships'. Industrial Marketing Management. Volume 37, Issue 8, pg. 940-52

Akshay R. Rao, Lu Qu and Robert W. Ruekert. (1999) 'Signaling Unobservable Product Quality through a Brand Ally'. Journal of Marketing Research. Vol. 36, No. 2, pg. 258-68