Scholarly Insights: AMA’s digest of the latest findings from marketing’s top researchers
Cobranding, the marketing of brands in combination, is pervasive. Yet cobranding is not a complete concept. It is a loose label that encompasses a number of distinct ways in which a brand can partner with another brand. A company contemplating cobranding should first ask: “Which type of cobranding, if any, is appropriate for my brand?” While financial rationales such as cost savings are cited in support of cobranding, marketing managers would do well to recognize the potential of cobranding in shaping customers’ preferences. Surprisingly, little to no work has compared and contrasted consumer responses to various types of cobranding to improve managerial decision making in this important strategic domain.
Higher cobranding integration leads to a greater impact on attitudes and consideration of the partnering brands.
Cobranding integration represents the degree to which the brands are intertwined in development, form, and function. Integration can range from almost completely self-standing to completely intertwined. Yum! Brands Taco Bell, Pizza Hut, and Kentucky Fried Chicken co-located in one building exemplify the low end of the integration spectrum. A low integration means the brands remain separate in form. Joint use of the brands, while not necessary, has the potential to add utility for the customer. At the other extreme, Nike + iPod for example, a music and fitness product co-developed by a Nike–Apple joint venture, is a case where the two brands are fully integrated. In the case of high integration, the partnering brands are combined in form and function and the consumer is forced to use both brands.
As integration between the brands increases (e.g., Oreo in Breyers Ice Cream) greater interdependence between the brands increases. When higher-integrated brands are consumed jointly, confusion can set in among the consumer as to which brand deserves responsibility for the outcome. In these arrangements, the brands are more likely to share the credit (or blame) for the outcome of the partnership. On the other hand, in a low integration cobrand (e.g., Starbucks in Barnes & Noble), the brands are more clearly separated in form and function and retain individual image and quality perceptions. Consumers are unlikely to attribute the performance of one brand (Starbucks) to its partner (Barnes & Noble), and so consumers’ evaluation of one brand is not likely to be influenced much by the cobranding arrangement.
Higher levels of integration reinforces the association between the brands in consumers’ minds, allowing the brands to be mentally co-categorized. Linking the brands together by using a cobrand partnership will enhance the memory retrieval of the brands and even facilitate a kind of brand recall. Accordingly, in a low brand integration arrangement, the performance of one brand is not clearly related to the other brand, joint sales are not mandatory, and, of course, the bond between the brands is weaker.
The impact of cobrand integration is mitigated by the details of the the partnership including the duration and exclusivity of the arrangement. Additionally individual brand characteristics such as brand image fit and how the brands “work” together also play a role in how consumer’s attribute credit (or scorn) to a brand.
Source: Casey E. Newmeyer, R. Venkatesh, and Rabikar Chatterjee (2014), “Cobranding Arrangements and Partner Selection: A Conceptual Framework and Managerial Guidelines,” Journal of the Academy of Marketing Science, 42, 103-118.