Branding Your Relationships
Your Brand is Your Promise, So Keep it.
By Tim Pedersen - FFP Online ( article- 2 of 3) 1,3

In part one of Branding Your Relationships, we discussed that the stronger your brand, the stronger your position will be in negotiating co-branding opportunities. And from what we have seen, like in the case of Jet Blue, a strong brand permeates throughout an entire company from the front-desk up. When entering into one of these arrangements, it is important to realize the role that you are playing in the branding game. When done properly, both brands will gain valuable access to other markets.

During my years dealing with airline loyalty managers, I quickly learned that many consider “co-branding” as two logos promoted on the same product, i.e., like on a credit card. There is a psychological phenomenon that occurs when two companies co-brand a product or service, and again you must know the role you are playing in the co-branding game.

There are three seats in which you could be sitting when negotiating a co-branding deal:

1) the powerful and strong brand pairing with a lesser known

2) the lesser known pairing with the strong or

3) equally powerful brands sitting across from each other.

When you are the more powerful brand, you will obviously have control. But what you must ascertain, even though you might be a stronger brand than the company sitting across from you, are you perceived as a strong brand in the overall marketplace? If you are the latter, you basically have nothing to lose with a wise decision. Because of the strength of your brand, studies have shown that a failed relationship will do little to tarnish your overall perception. This will be especially true if it is a secondary service or product. Consider Dupont’s licensing of Teflon®. Many lesser known brands have licensed the use of Dupont’s non-stick technology, yet whilst the failure of one of those companies might have a fractional financial implication, it will do little or nothing to the overall brands’ perception.

If you are the lesser brand, you will have much to gain with the right relationship and a well-chosen partner. Simply put, you will be getting an endorsement from a more powerful brand, and this association will add credibility to your company and can have lasting effects, even if it is only a short-term arrangement. Successful situations include NutraSweet being added to Diet Coke – basically their endorsement of the product. Nutrasweet gained considerable marketshare, similar to what Splenda is now experiencing.

When equals sit across from each other, the goal is for both companies to successfully gain market share in areas that they would otherwise have a hard time reaching alone. A great success story is the teaming of Hawaiian Airlines with Walt Disney Co. and their release of Lilo and Stitch. Their co-branded short-term promotion helped the movie become the 12th biggest grosser in 2002 and produce double-digit percentage increases in Hawaiian Airlines California traffic. A strategic co-branding arrangement is a more long term one such as Slimfast and Godiva’s co-branded cake mix or Barnes & Noble’s licensing of the Starbuck’s brand inside its cafes. If a corporate scandal were to close the doors of any of these companies tomorrow, the partnered brand would carry on without a scratch. Yet, while in effect, they gain powerful access to new markets.

Here is a checklist to consider when entering these situations:

Evaluate your brand strength:
Where the other company might be technically larger, your dominance in a particular market
can equalize the playing field.

Know your status and how you compare.

Know what your proposed partner is trying to accomplish.
Clear goals and objectives on both sides can create successful wins.
Make sure your objectives line up.

Is this a short-term or strategic relationship?

Listen to your customers (FFP members)
Be sure that the partnership is a good fit in their eyes –
is this adding a product or service that surveys have indicated they want?

Value

Determine what value you want and expect to receive by the co-branding effort. What added value you will be offering through this partnership.

By asking these questions and carrying out the above research, not only will you know in which seat to sit at during a negotiation, you will also be able to maneuver from a knowledge base, and enhance the overall outcome of your co-branding effort.

In our last segment, we will discuss how to guide the corporate brand message to become a delivered promise, rather than a failed expectation. To conduct an internal brand audit within your own organization, contact us for a list of questions that will reveal if you are branding your relationships or just going through the motions.

To conduct an internal brand audit within your organization, contact us for a list of questions that will reveal if you are branding your relationships, or just going through the motions.