I've recently blogged about an example of co-branding between Missoni and Target. Co-branding can be an effective way to boost the brand of your product or service, and make your company more profitable.
Although their positioning is quite different from each other, and they serve different types of customers, Missoni and Target seem to go well together because they are part of the same industry -- fashion. Some other examples you've encountered on my blog -- for example a brand partnership between nail polish OPI and Dell laptops -- might seem less logical at first sight -- but they still work. Provided they have been formed in line with both parties' brand strategies.
The main example discussed in the article is the already mentioned partnership between Missoni and Target in the USA. Ritson refers to it as an "impressive demonstration of the commercial and strategic advantages of co-branding." He then proceeds to giving a set of co-branding rules, which I found important to summarize here for my readers:
Co-branding rule #1: Explore the yet unexplored
According to Ritson, for co-branding to work, it would need to be based on contrasts rather than similarities.
This indeed sounds like a no-brainer to me, although I've noticed that many companies have difficulties grasping this simple rule. Many of them think that a win-win partnership is only possible with brands similar to theirs. Usually this kind of approach will waste you a lot of time with little return. Instead of reinforcing what you've already got anyway, why don't you explore something totally different? Of course, exploring the unexplored needs to be already part of your brand strategy -- co-branding is not good for experiments.
The way to go is to look for a brand partner whose strategic positioning will bring your brand to the area you haven't explored yet. In other words, a smart brand partnership will help you implement your brand strategy quickly and efficiently. For instance, in the case of Missoni and Target, Missoni got access to a huge US market which it would have otherwise needed to reach by very expensive and possibly lengthy campaigns, whereas Target strengthened its brand attributes such as design and affordable luxury in no time.
Co-branding rule #2: your co-branding partner needs to have a target market different from yours
If you plan to generate brand awareness about your product within a totally new target market, then partnering with a brand which already has this reach could be a very smart move. I don't know the details of the agreement between Missoni and Target, but just imagine how big Missoni's US marketing budget would have been if the brand had decided to reach US consumers all alone, without Target's help -- it would have been simply astronomically huge.
Co-branding rule #3: your brand has to have a "legitimate fit within a product range being offered."
Your brand positioning within your product category needs to be well-known in order for you to start thinking about co-branding. This is why you usually see well-known brands entering into partnerships with each other, rather than one strong brand pulling along an unknown one. Exceptions to the latter could be partnerships between well-established brands and young artists and designers. There are plenty of examples to prove this, and I invite you to have a look at the Kipling's Monkey Mashup contest for artists and designers. Whereas I wouldn't call it a long-lasting brand partnership, this kind of contest created a lot of buzz for the participating artists, and once again refreshed Kipling and its DNA of funky, innovative design.
Finally, on November 17th H&M is set to release a collection designed by Versace. Do you think this will be a fruitful co-branding project for both brands?