Is co-branding the magic word in times of slump?
Industry experts say co-branding can be a strategic marketing tool and the success of one brand can bring success to its partner too
With the Indian markets experiencing a slump, co-branding has emerged as a new trend.
Labels like Spotify, Zoomcar, Swiggy, Ola, OnePlus and Uber have joined the co-branding scene. We spoke to experts to know more about the significance of this trend.
According to Azazul Haque, Chief Creative Officer, Mullen Lintas, co-branding helps brands to perform better during a downshift in marketing. From a marketing cost-efficiency point of view, there can be various benefits of co-branding during phases like recession, he said.
He explained that co-branding is a strategic marketing and advertising partnership method between two brands wherein the success of one brand brings success to its partner brand too. Even during a recession, co-branding can be an effective way to build a business and boost awareness.
“Co-branding not only reduces the cost of marketing expenditure, but also utilises the equity of both the brands for a positive rub off on each other," Haque added.
“The digital economy has been instrumental in breaking down walls between business entities, especially in the consumer internet realm, and has made it easier for brands to collaborate at much ease for mutual growth and expansion,” said Varun Jha, Chief Marketing Officer & Head – Demand Business, Zoomcar.
Co-branding helps partner brands to collaborate and tap into the other's mindshare and outreach. Also, new-age consumers are more value-oriented. Hence, a collaborative approach tends to increase the value of offerings and makes it more appealing for the end consumers.
“However, before commissioning a co-branding campaign, the brands must ensure they share a similar vision and core values as these nuances often result in a successful campaign,” said Jha.
Similarly, Swiggy has also partnered with Hotstar and the food delivery platform has seen a 25 per cent increase in order numbers.
According to Srivats TS, VP, Marketing at Swiggy, co-branding helps them earn large profits but it depends on what the company aims. A successful co-branding needs all partners to have a customer-centric approach, Srivats emphasised.
According to Dr Kirti Sharma, Assistant Professor, Management Development Institute, co-branding during a slump in the market helps both brands to have more ROI and reach with less money spent on marketing activities.
“The impressions are more because of co-branding. Both brands are able to reach out to consumers and this helps in reducing the marketing spends,” she adds further.
When asked how co-branding during recession affects customers, Sharma said, it’s a win-win situation for consumers as well since they get a better deal because of co-branding. For instance, some brands give an exclusive discount to certain card-holders to the new-collection of an apparel brand.
Co-branding can do wonders if both the brands have the same equity but there are times when one gets benefited more, she pointed out.
Dr Ashavaree Das, Chair of Media Division in Dubai Women’s, and a brand expert says co-branding is a strategic alliance where the strength of both brands can be leveraged.
“And when it comes to a slowdown, co-branding can prove to be a gold mine because it's a cost-cutting measure with optimum utilisation of resources,” Das added.
In today’s age of social media, brands are giving their best to survive in this phase of a slowdown, Das said.
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