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Co-branding
To put in the words of inter-brand definition, "Co-branding is a form of co-operation, in which all the participants' brand names are retained."
And 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.
Most companies have explored co-branding at one time or another. But few have realized its full potential. While there are many forms of co-branding; before a company can decide which option makes the most sense for its situation, it must fully explore four main types of co-branding.
Each is differentiated by its level of customer value creation, by its expected duration, and perhaps most important, by the risks it poses to the company. These risks include the loss of investment, the diminution of brand equity and the value lost by failing to focus on a more rewarding strategy.
Reach & Awareness Co-branding
This is the lowest level of shared cooperation in a co branding exercise and its objective is to rapidly increase the awareness of the sharing brands through each other's strength in the respective domains. The example for this type of co-branding is found in the credit cards.
In fact co-branding of this type finds the maximum utility of co-branding. In the Indian context, we have already observed a spate of co-branded credit cards between Citibank and Jet Airways, Standard Chartered Bank and Indian Railways, Indian Oil and Citibank, and Citibank and The Times of India.
The benefits of co-branded cards to the cardholder is that he gets points whenever he uses it and he can get these points redeemed for additional products or services for free. Thus, it builds loyalty to the brand or service in use by the customer. This is a sort of affiliate marketing between three brands, viz., a payment service franchiser (Mastercard, VISA), a bank and a product or service.
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* Contributed by -
Abhishek Mishra & Manisha Singh,
PGP - II,
XIM Bhubaneswar.
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