The Need and Efficacy of Co-Branding

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Shannon Robinson

31st December 2019

Shannon Robinson

Defining Co-Branding:

Co-Branding is a term which refers to as marketing partnership between brands which are independent providers of goods and services. The result of this correlated partnership benefits both brands on a higher level comparatively, instead if they are promoted individually. Co-Branding works on the expression, “the whole is bigger than the parts,” indicating that unity will benefit the products more as compared to if they will be promoted individually.

A simple example of Co-Branding is when DELL or HP computers sponsor with Intel or vice versa. Both the tech-giants come together, as both the conglomerates know that neither of the brands, despite having a cornucopia of brand-loyalists, will not be able to rally a number of customers their side individually, then both could do together.

Likewise, the same goes for Dairy Milk Oreo, and McFlurry Oreo; the combination of Oreo, with two of the most famous eatery brands, that is, Dairy Milk and McDonalds has dramatically enhanced the value and demand of Oreo.

The Need and Efficacy of Co-Branding

Types of Co-Branding

One important element of Co-Branding is that both of the brands must have equivalent Brand equity, or else it will not work. For instance, if Brand A has a lower brand equity, and is advertised with Brand B, that has higher brand equity, then this lower brand equity of brand A will affect the commercial value of Brand B. This is very true if both brands that are promoting each other are not famous or new in the market. Since Co-Branding elevates the commercial value of brands, there are two types of Co-Branding existing in today’s world that affect the promotional value of each other.

  1. Ingredient Co-Branding

In this type of Co-Branding, one of the brands is well known, but the other one is not. This specific type of Co-Branding occurs when the latter brand has to be made famous. For example, Apple promoting an App Store software application, such as; Prisma (picture taking application). In such cases, the latter app is supported to publicize the new and not so famous brand.

2. Composite Co-Branding

The second type of branding is Composite Co-Branding. In such a case, two of the already famous brands associate with each other for marketing. For example, Whirlpool washing machine advertising with Tide detergent, both are the USA’s top, most used brands, and have a massive crowd of audience, this type of Co-Branding is known as Composite Co-Branding.

The Need and Efficacy of Co-Branding

The Need of Co-Branding

The need and efficacy of Co-Branding in this contemporary era has increased more than ever before. Today brands get their heads together and are seeking out new techniques to pull in more customer ratio. To learn the need and efficacy of cobranding, read out the points below:

1. To Increase the Market Size

The companies that are seeking for the most effective marketing strategy for them, Co-Branding is a must. A brand that has loyal customers, when it falls on the same page with another brand, their audience gets attached to the collaborated product as well — the association maneuvers the customers to be attracted to what the other company is offering. And hence, within no time, a big crowd is ready to invest in the other brand due to the trust and relationship that exists with the previous brand. For example: Master Card and Apple Pay.

“Coming together is a beginning, staying together is progress, and working together is success.” – Henry Ford

The Need and Efficacy of Co-Branding

2. To Establish Credibility

Those companies that are in the market for an extended period of time have already established credibility; customers trust their brand and products even with closed eyes. These companies, when they collaborate with other brands, they enhance the credibility of the other brand, and as their loyal audience trusts them so well, based on that very trust, they will readily accept the other brand. This increased brand trust is going to help grow sales in the long-term as the audience will always look to the company for that particular product and its service category. For example, Coca-Cola Co-Branding with an unknown food restaurant will automatically enhance the reputation of that place.

Talent wins games, but teamwork and intelligence win championships.” – Michael Jordan

The Need and Efficacy of Co-Branding

3. To Make Loyal Fans Feel Like They Have Been Given More Value

Those people that are loyal to a brand prefer to try all the products or services marketed or offered by the brand, and hence, when they see their favorite brand marketing something, they are most likely to try that other brand, taking it as a complimentary service for themselves. So, one way or another, the collaboration is going to build customer’s interest, eventually increasing the value of both bands in the customers’ eyes. Example: Oral B and Brown, both working on giving people quality service of personal care electronics.

“Every contact we have with a customer influences whether or not they’ll come back. We have to be great every time, or we’ll lose them.” – Kevin Stirtz

The Need and Efficacy of Co-Branding

4. To Give Rise To More Creative Ideas

When two brands join hands, both must come up front with their best team members and develop a marketing strategy that has the power to allure the targeted audience within as little time as possible. Every company has creative employees; listening to their ideas of the associative brand will allow some new perspectives and strategies to develop, and working on the best ones with joint efforts can take the partnership on a very high level.

“The key is to set realistic customer expectations, and then not to just meet them, but to exceed them — preferably in unexpected and helpful ways.” – Richard Branson

The Need and Efficacy of Co-Branding

5. To Help in Cash Injection

This need tops all the other requirements. Those brands which are comparatively new in the market and do not have a handsome budget to spend on their promotions, for them Co-Branding, is the best option available. First of all, teaming up will divide all their costs and simultaneously enable more cash flow. Second, it will bring in more customers, meanwhile promoting the sharing of resources, and third, it will enhance better relationships and networks, opening new doors of opportunities in the future. Thus, Co-Branding at time of need will turn out to be a big hit. But in order to keep things balanced and smoothly to go, a proper contract or agreement must be set up that would decide all the terms of references and profit and loss conditions; otherwise, the collaboration will hit up both the companies in their face.

“A group becomes a team when each member is sure enough of himself and his contribution to praise the skills of others.” – Norman Shidle

The Need and Efficacy of Co-Branding


Long story short, Co-Branding today is a great and most effective way of increasing consumers and converting them into loyal customers. All big and famous brands are using Co-Branding as their marketing strategy to pull in more audiences and hence benefitting on a colossal level, earning the trust of their customers and growing up. Uber, Spotify, Apple, M.A.C., Tide, HP, Dell, and several other brands have been using this strategy and are continuously growing. However, the technique has its demerits as well, and if not handled carefully, it can damage a brand’s reputation as quick as lightning. It is always better to take calculated risk rather than investing a huge amount at stake and then regretting it in the future.

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One Response to The Need and Efficacy of Co-Branding

  1. david moore says:

    hmmm… good and inspirational article.also check out my logo design work.