If another brand fits, co-opt it

Co-branding could well be the key that will unlock the door to a brand-focused Chinese industry

Even though co-branding or brand alliances have been around for many years, 50 years or more in fact, there remains no universally accepted definitions. However, there is more and more agreement on the growth and importance of co-branding to any sustainable competitive brand advantage in today's globalized marketplace.

It is also an area that many Chinese companies, with aspirations toward developing internationally competitive brands, could explore further, especially those with some form of existing joint venture or alliance with foreign companies.

Before discussing a few of the more common definitions, it is worth introducing some of the terms often used interchangeably with co-branding such as: brand alliances, symbiotic marketing, joint branding and cross-promotion. Of these, brand alliance is favored due to the range of possible types of cooperation that fit neatly inside this umbrella statement.

Early definitions of co-branding centered on an integration of two or more products and either a symbolic or physical brand alliance. More recent definitions include a slightly more refined statement the essence of which claims that, co-branding occurs when two or more (but usually only two) existing brands are combined into a joint end product or are marketed together in some way.

While an infinite number of Chinese companies are involved in alliances with foreign companies, it remains the case that precious few (if any) can boast a genuine brand alliance in which their company brand or product brand(s) benefit substantially. Most play the role of low-cost producer and little or no brand development takes place within the Chinese company and therefore little or no understanding of branding take place too.

Even when the Chinese company name appears on the final (Western) branded product, as is the case with a few automotive industry joint ventures, such representation barely registers with the market.

Knowledge co-branding

This is the weakest form of co-branding since it requires little extra financial investment. The aim here is to build brand awareness and brand image via elaborate contact with the partner's target market.

An example of this type of co-branding is provided by American Express and Delta Airlines who between them designed a Sky Miles program where they developed combined promotional activities. The objective was to reward members with bonus points while at the same time allowing them to use the credit card in stores.

This joint initiative allowed Delta Airlines to build loyalty further among its customers and enables American Express to acquire new customers. This form of co-branding is often not a long-term partnership and frequently focuses on the short-term needs of the companies involved.

Value-endorsement co-branding

Unlike knowledge co-branding, this form of co-branding involves the explicit reference to and promotion of each brand's respective brand values and brand associations. Values endorsement of both brands together aims to create a spillover effect where both brands benefit from the joint exposure.

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