How fmcg product use co branding and joint sales promotions to increase sales

April 21, 2022 Team DigitalGumma

The Basics of Co-Branding: Benefits, Strategies and Examples

Want to level up your reputation while boosting sales?

Try co-marketing!

After all, partnering up with fellow businesses is a proven way to scale.

But co-marketing partnerships represent so much more than just joint promotions.

Co-Marketing Activities and Ideas for Joint Promotion

Co-branding is an effective way for companies to combine forces, leading to increased brand visibility and profits while reducing individual costs and risk. Many companies use this marketing strategy to create better products and share other companies target consumers. Because of this, it is important for marketing and business professionals to understand the concept of co-branding. In this article, we will discuss co-branding benefits and strategies and give several examples of co-branding successes.

What is co-branding?

Co-branding, also known as a brand partnership, is a marketing strategy that pulls two or more brands together in an alliance for the mutual benefit of all parties. Co-branding is not simply adding two company names together on a product. A co-branding partnership combines the identities and resources of each partner to create a new service or product, complete with new logos, brand identifiers and colors.

To be successful, co-branding campaigns create a product or service that is unique or has added value for customers. Sometimes that value is in a better product, a specialty food item, a status symbol or an improved public image.

Co-branding vs. co-marketing

Co-branding is not the same as co-marketing. Co-marketing occurs when two firms align their marketing efforts but do not create a new service or product. Spotify’s partnerships with Uber and Starbucks are a great example of co-marketing. Spotify’s services add value to your Uber ride or coffee time in Starbucks, but the partnership doesn’t ultimately produce a new product for consumers.

How does co-branding work?

Co-branding involves two or more independent brands working together on a new product or service. The most successful co-branding partners have similar values, missions and cultures. Co-branding partners pool resources including in-house expertise, technological advances and funding. The new product or service created by the co-branding effort usually has its own brand name or logo.

If the co-branding campaign is successful, it may reward partners with increased profits, positive associations and a larger customer base. Unsuccessful co-branding campaigns may not earn money, but the risk is spread out among all partners, lessening each company’s individual loss.

Benefits of co-branding

Co-branding can be beneficial to all parties involved, including the consumers who purchase the products or use the service. Here are a few of the most notable benefits of co-branding for companies:

Increased customer base, including customers in previously unreached demographics
Increased sales
Creation of better quality products
Generation of a royalty income
Increased customer loyalty
Enhanced brand recognition
Increased credibility and respectability when aligned with the right partner or project
Sharing of the financial burden for marketing, technology development and promotional events
Revenue from mutually produced technology
Sharing of risk across all partners

Types of co-branding strategies

Here are the most common co-branding strategies used today with notable examples:

1. Ingredient co-branding

In an ingredient co-branding strategy, professionals use the ingredients or components of one well-known brand in another well-known brand’s product. In an ingredient co-branding partnership, each partner is usually a major brand in their industry, with unique qualities and products protected by patents.

2. Same-company co-branding

Same-company co-branding is a marketing strategy used by companies to promote multiple in-house brands under one product. Large food conglomerates often use same-company co-branding to promote their products. This form of co-branding only involves one company but may feature collaborations with subsidiaries.

3. National to local co-branding

National to local co-branding occurs when small local businesses team up with a nationally known brand. The goal of this partnership is to increase national brand awareness while increasing small business revenue. Visa often co-brands credit cards with department stores and other small retailers. Vehicle manufacturers often co-brand with local car dealerships.

4. Joint venture or composite co-branding

Joint venture or composite co-branding is an alliance between two or more well-known companies with the goal of presenting a new product or service that wouldn’t be possible individually. This can include creating an entirely new product together or improving an existing product. An example of this is when a streaming service platform partners with film studios to create or host movies and television shows.

5. Multiple sponsor co-branding

Multiple sponsor co-branding occurs when two or more companies pair up to share technology and promotional events. Professionals use multiple sponsor co-branding in athletic events, concerts and attention-grabbing stunts. Each company involved often earns an opportunity for increased sales, brand recognition or reputation.

Related: 30 Event Promotion Ideas

Co-branding examples

Here are a few examples of the most successful co-branding partnerships:

Dawn and The Bird Rescue. Dawn dishwashing detergent partnered with International Bird Rescue to help birds and other wildlife affected by oil spills. The Bird Rescue gets thousands of bottles of Dawn and Dawn gets a reputation as a compassionate community partner.
Hershey and Betty Crocker. The partnership between Hershey candy company and Betty Crocker is a classic example of ingredient co-branding. Hershey candy products have been used in Betty Crocker baking mixes and frostings for years with great success. The co-branding campaign has created some of the most popular baking mixes on store shelves today.
Doritos and Taco Bell. The Doritos ingredient co-branding partnership with Taco Bell resulted in the new Doritos Locos Taco, which sold over 100 million units in its first 10 weeks. The partnership is still going strong, with continued benefits for both parties.
GoPro and Red Bull: A well-known example of multiple sponsor co-branding is the partnership between GoPro, Red Bull and the Stratos event. At this event, Felix Baumgartner performed a historic and record-breaking free fall from 128,000 feet above the Earth’s surface. The collaboration between GoPro and Red Bull funded this event. The companies worked together to address technological challenges, film and edit the event and create promotional campaigns.
Coca-Cola and American Red Cross. Coca-Cola helps local chapters of the American Red Cross organize charity events, promote small-scale healthcare events and assist with disaster relief. Local Red Cross chapters benefit from this arrangement by having a partner that can supply volunteers, much-needed funds and event visibility and Coca-Cola gets a boost to its reputation.

Food for thought: Brand Managers note that 58% of brands are laser-focused on raising awareness (while 35% are attempting to grow their audiences, too). Partnerships are key to doing both.

Because working alongside other businesses in your industry empowers you to build relationships and leverage your brand as an invaluable resource.

Curious about co-marketing? This guide breaks down everything you need to know and how to get started.

What is co-marketing, anyway?

Let’s kick things off with a quick definition.

Co-marketing is a strategy that involves brands or organizations partnering to expand their reach. Typically, companies involved in co-marketing campaigns share common audiences or work within the same industry (but are not direct competitors).

The concept is simple enough: working side-by-side with another brand is a way for both parties to introduce themselves to new audiences, drive additional revenue and build awareness. Everybody wins, right?

While the concept isn’t exactly groundbreaking, co-marketing relationships are totally different from the typical partnerships we see brands make today (such as affiliate programs, brand ambassadorships or influencer marketing).

The key difference? With co-marketing campaigns, the collaborating brands are treated as equals. This rings true when it comes to both promotion and doing the actual legwork of putting together the campaign.

3 common co-marketing examples (and why they work)

So, what does co-marketing actually look like in practice? Here are a few marketing campaign ideas for inspiration:

Partnering up to educate your audience

Whether in-person or through digital events (such as webinars), educating your audience is perhaps one of the easiest ways to get on board with co-marketing in B2B.

Social platforms like Twitter and LinkedIn make it a cinch to drive sign-ups and build buzz for webinars. Such events are a brilliant way to drive sign-ups and provide legitimate value to your audience.

co-marketing webinar example between Tinuiti, IZEA and Gorgias.

Co-hosting promotions and product launches

Co-marketing is perfect for product launches, helping you get the word out and build buzz when you need it the most.

Giveaways, contests and brand takeovers are all popular campaign ideas that allow multiple brands to leverage each other’s followings to get as many eyes on their promotions as possible.

Creating a totally new resource for a shared audience

The idea here is that two heads are better than one when it comes to sharing insights with your audience.

For example, the Harris Poll and Sprout Social teamed up for our social media investment report that served as an invaluable resource for both parties. This highlights how co-marketing campaigns can complement the strengths of two totally different brands.

Example of co-marketing between Sprout Social and The Harris Poll.

Co-marketing vs co-branding (and why they’re different)

The terms “co-marketing” and “co-branding” are often used interchangeably but they’re far from the same.

In short, co-branding typically involves two brands partnering up to launch a new product and using their respective name recognition to build buzz. Co-branding campaigns are typically reserved for brands with larger audiences and are common in the world of ecommerce (think: brand collabs, limited edition runs of products).

When it comes to effectiveness, it’s not really a matter of either/or of co-marketing versus co-branding. They’re two totally different types of campaigns. Co-marketing represents more of a straightforward promotion while co-branding involves the legwork of creating an entirely new product.

That said, both are great for building awareness and reeling in customers.

What are the big-picture benefits of co-marketing?

At a glance, partnering up with other businesses might not seem like a priority in your pursuit of a larger audience.

The reality, though? A staggering 77% of brands agree that partnerships are key to growth.

Below is a quick breakdown of how brands benefit from co-marketing campaigns.

1. Tap into totally new audiences

The more people you can get your brand in front of, the better.

Instant exposure to a partnering brand’s social following or email list is nothing to scoff at. This is especially true if you’re an up-and-coming business or you’re making your introduction to an audience that has no idea who you are.

2. Cement yourself as an industry leader

No matter what industry you’re in right now, competition is fierce and attention is scarce.

Brand partnerships provide an opportunity to break through the noise. Doing so also signals you as someone worth working with that has potential name recognition. This can immediately set you apart from competitors in a big way.

3. Build relationships within your industry

Perhaps one of the underrated advantages of co-marketing is the ability to build relationships with like-minded business owners and industry experts.

You really can’t afford to be an island in today’s social landscape. Whether short-term or long-term, having a network of people that can build you up and boost you can be a game-changer.

4. Explore new markets without expanding

Co-marketing also provides an opportunity to dip your toes into a new market without a full-blown expansion.

If nothing else, a campaign might serve as an opportunity to conduct some market research and learn more about audiences parallel to your own.

5. Acquire new leads

Beyond brand awareness, this is the big one.

When done right, co-marketing seamlessly allows you to grow your list, drive opt-ins and drive traffic to any given promotion.

How to put together a co-marketing strategy from scratch

Although co-marketing campaigns are arguably easier than ever to put together, they still require planning and attention to a few key details. Let’s look at some of them below.

1. Define your goals and objectives

Just like any type of campaign, you need to have your specific goals and desired outcomes defined before it goes live. There are no “right “answers here, but you should at the very least be able to define:

Why you’re running the campaign (brand awareness, leads, a combination of both)
What resources will be required to fulfill your end of the campaign (creatives, time and so on)
How you’re going to measure success (metrics and KPIs such as sign-ups, traffic or conversions)
What your deliverables are going to be (social posts, emails, webinar slides and so on)
What are your expectations are in terms of what your partnering brand(s) will deliver

2. Build relationships prior to outreach (and be open to opportunities yourself)

You should obviously be thoughtful when it comes to who you partner with.

Ideally, co-marketing opportunities should spring up organically with brands and marketers you trust and have existing relationships with. As noted earlier, brand partnerships are ideal for those that are industry-adjacent without being direct competitors.

Co-marketing campaigns usually aren’t going to come from cold outreach. That said, it doesn’t hurt to start thinking about potential partnership candidates to explore opportunities.

Likewise, be open to opportunities yourself. You can probably tell pretty quickly whether someone’s done their homework and actually wants to engage in a meaningful co-marketing effort.

What matters most is that the relationship is a win-win for both parties and isn’t one-sided in terms of who’s doing the bulk of the work for the promotion.

3. Make sure to measure your campaign results

Even if your campaigns are centered primarily around awareness, tracking your efforts with KPIs is a must-do.

Reach. Engagement. Conversions.

There are so many ways to measure success and they should be front-and-center before you get started. For example, you should consider:

Tracking sign-ups, opt-ins and other conversion-related metrics (and tying them to your co-marketing campaign)
Assessing followers, @mentions and sentiment through social listening to see if your campaigns actually built positive buzz)
Looking at landing page traffic and lead sources see how engaged your co-marketing audience was

How social media can drive your co-marketing strategy

Social media is key to modern co-marketing campaigns and maximizing your reach.

How so? Let’s look into the role that social plays in getting the most out of your brand partnerships.

Promote your co-marketing campaigns organically

No surprises here! Basic promotional strategies related to co-marketing might include:

Making announcement posts and hyping up your brand partnerships
Expanding the reach of your efforts through employee advocacy to reach even more people (see below)
Funneling social traffic to a specific branded landing page (and measuring engagement)

What is co-marketing?

Co-marketing is about two companies coming together to undertake joint promotional efforts as a team. Partnering in this way results in high-quality content or products that promote both businesses. The results can range from special packaging to completely new products.

For example, there may be a business that sells glasses and another that promotes recycling. The two could team up to sell a special range of glasses made from recycled material.

Why Co-Marketing Works

Making a successful online brand is about finding your niche and connecting with an audience. Creating a partnership through co-marketing can help you with this as it allows you to explore a new angle. This type of marketing is based on connecting two companies that sell online, with each company promoting the other’s product or services. The result is that both end up benefiting and making a profit from one another.

It could be that the two firms create and sell a product together. Or it could be that each firm sells a partner product that the other could benefit from. Either way, the firms then work together to market the new products to a bigger online audience.

Are Co-Marketing and Co-Branding the Same?

Co-branding is very similar to co-marketing, but often focuses on more established, big-name brands. This is more about bringing together the elements that make up a brand, such as the logos or colour schemes. It focuses on creating a partnership to increase brand exposure, rather than ‘marketing’ a new product or running a new joint campaign.

The reason brands tend to team up in co-branding is that their audience will already have some sort of overlap. Even if it is small.

Of course, when starting a business, companies don’t intend to partner up. But after realizing similarities, co-marketing or co-branding can bring huge success.

What Are the Benefits of Co-Marketing?

The aim of co-marketing is to provide mutual benefits. In general, co-marketing can improve company reputation and save money. Other benefits include:

1. Reaching a bigger audience.

One of the major benefits of co-marketing is that firms can double up on audiences. This is done by sharing the finished product or campaign with fans of both companies. But not only that, it even creates customer loyalty and can give each brand a stronger voice.

For example, say you are a media communications company. But you want to expand more into cloud computing to be more involved with tech. So, you look to work with a cloud company to create a fresh product. You may end up with something similar to Talkdesk but with more of a media-based focus. And it will be that perfect fit between communications and cloud.

Another related advantage to co-marketing is that firms can use separate campaigns to reach a bigger audience in general. Taking the previous example, a campaign can go to the media firm’s base and another campaign to the cloud company’s audience. On top of this, a third campaign can also be created that is shared with a new audience completely.

2. Being able to analyze campaigns.

After taking part in a co-marketing campaign, both firms can analyze and compare which audience gave the best response, and then can build or work on that. Fortunately, there are lots of free business tools that can help you see which campaigns work for each firm. You can then compare and contrast to get a fresh perspective and outside advice.

It could just be that your partner recommends using a grammar checker. Or it might be that you notice they have a lot of engagement through using influencers. Whatever you discover, co-marketing is a great way to learn more about your company.

How to Know Who to Partner With

A major point of co-marketing is that it benefits both sides. And the firms also need to bounce off one another and work well together. So, you will want to pick a firm that aligns with your values and goals.

There is no point in a vegan cheese company partnering with an organic dairy farm because the values don’t align. And, if anything, there is a risk of losing fans, rather than gaining them. So, to plan and be a success for the future, the choice of partnership needs to be smart.

Therefore, you need to pick someone you will be proud to partner with, and who you are happy to tell your audience you work alongside. Then, you need to check that your partner’s audience is a good fit for your audience. Remember that co-marketing isn’t just about building numbers. It’s about building a loyal following, putting trust in a partnership and telling your audience you care about their interests.

Keep in mind that the partnership doesn’t have to be huge. It could just be that you have written a quick “Bitrix24 review” as a guest post for a cloud firm’s blog. Or maybe you will decide to bring two unique specialist flavors together to create a cupcake that represents both you and your partner brand.

Conclusion

Co-marketing is an excellent way to bring an audience something new and to boost both you and your partner’s reputation in ecommerce or another niche. Whoever you partner with, choosing a firm is about bringing together the best of both your worlds to create something unique and enjoyable. Just make sure that you are both comfortable with any decisions made.

Ideas for Effective Co-Marketing Activities

There are many different co-marketing activities you can implement, though not all will be equally suited for your particular audience and goals. Examples of ideas to consider include:

Partnered Content & Guest Blogging

Examples of partnered content include ebooks, blogs, and infographics. You jointly create a valuable resource designed to benefit your shared audience. Typically, it’s a good idea to identify a topic about which you can each share differing insights in order to provide a fresh perspective for your readers. After all, the goal is to create a co-marketed piece that is greater than the sum of its parts.

Original Research

Original research is a powerful tool that can be enormously beneficial for authority and SEO. Collaborating with a partner, you can conduct a survey and compile research for an industry study. While this is a demanding effort, it can also be one of the most rewarding. When done correctly, your original research will be an authority in the industry that people link back to for years to come. For further information, we recommend reading White Paper Marketing Strategies to Promote Your Thought Leadership.

Webinar or Video Series

Similar to partnered content, webinars and video series are great ways to share your expertise with a partner. Collaborate to highlight a unique perspective or educate on something specific. Lean on some big names at your organization to drive additional attendance and engagement.

In-person or Digital Events

Since organizing events can be so costly and time-consuming, they’re an ideal co-marketing activity. Your partner will ideally help out with the required costs and labor, as well as enrich the overall experience for attendees. Additionally, like with other co-marketing ideas, you’re able to reach a broader audience than you would alone.

Click here for additional ideas on marketing with partners

Joint Promotion Efforts to Ensure Visibility

Even the best content or product will have minimal impact without the proper activities to build awareness. No co-marketing strategy would be complete without detailed plans for joint promotion. While the preferred channels and methodology depend greatly on your unique situation, options include Google PPC ads, social media ads and organic social media campaigns, email blasts, sponsored posts, press releases, and more.

It’s a good idea to connect with your partner to determine the best-fit promotion vehicle for your partnership. Your collaborators’ past strategies may have differing success levels than your own, and their marketing team structure could potentially supplement your weaknesses. Co-marketing presents the unique opportunity for organizations to bounce around ideas, learn from one another, and leverage resources otherwise unavailable, so make sure to maximize such rewards!

Best Practices for Effective Co-Marketing

Once you’ve decided you’d like to move forward with co-marketing activities, there are best practices you should keep in mind to ensure your campaigns are successful.

Look for Appropriate Audience Overlap

Your goal should be to co-market to an audience that is likely to purchase from you, which means that their audience should match your target customer profile. However, most of these individuals should not be existing customers.

It’s a good idea to also consider your own audience when selecting a partner. Is there something they could learn from your partner that you’re unable to teach them alone?

Discuss Shared Goals

Co-marketing shouldn’t be one-sided. Both partners should stand to benefit from the campaign, so discuss your goals ahead of time. If you look to collect email addresses and your partner just wants to generate new backlinks, you might not be able to achieve both objectives.

Establish a Timeline

If you thought it was challenging to coordinate internal campaigns, wait until you start developing co-marketing campaigns. With so many stakeholders and contributors involved, it’s imperative that you outline a timeline for your activities and define ownership early.

Build a Co-Marketing Agreement

It’s important to define who’s responsible for what when it comes to co-marketing. Develop an agreement that details the timeline and expectations for each team. This includes the allocated budget, level of participation, targeted audiences, asset ownership and trademarks, customer support, confidentiality, and other elements your legal team may deem necessary. Remember, the more points, the better; at no point should there be ambiguity about who should handle an unforeseen scenario (and how).

If it’s a long-term project, consider implementing regular check-in meetings to maintain progress and pivot strategies when necessary.

Co-Marketing Takeaways

Co-marketing can be an incredibly effective tool when implemented well. In order to drive the best results, you need to identify a great-fit partner, who has a little bit of audience overlap and a common goal. Share ideas, historical insights, and resources to jointly determine the optimal co-marketing ideas for your brands and customer bases.

Allbound PRM is the platform for successful partnerships. Simplify your entire partner lifecycle — including partner marketing efforts with Allbound PRM. Our Content Library and Content Management tools make it easy to store and organize your marketing materials where you already keep your customer data. Learn more about partner marketing and co-branding capabilities within the Allbound portal.

What Is Synergy in Co-Branding?

Co-branding is a marketing strategy that utilizes multiple brand names on a good or service as part of a strategic alliance. Also known as a brand partnership, co-branding (or “cobranding”) encompasses several different types of branding collaborations, typically involving the brands of at least two companies. Each brand in such a strategic alliance contributes its own identity to create a melded brand with the help of unique logos, brand identifiers, and color schemes.

The point of co-branding is to combine the market strength, brand awareness, positive associations, and cachet of two or more brands to compel consumers to pay a greater premium for them. It can also make a product less susceptible to copying by private-label competition.

KEY TAKEAWAYS

Co-branding is a marketing strategy that utilizes multiple brand names on a good or service as part of a strategic alliance.
Co-branding can boost the reputation of two or more brands, depending on the strategy employed. There are four distinct strategies including market penetration, global brand, brand reinforcement, and brand extension strategy.
For example, Citi AAdvantage cards that give you American Airline miles when you spend money incentivizes both companies.

Understanding Co-Branding

Co-branding is a useful strategy for many businesses seeking to increase their customer bases, profitability, market share, customer loyalty, brand image, perceived value, and cost savings. Many different types of businesses, such as retailers, restaurants, carmakers, and electronics manufacturers, use co-branding to create synergies based on the unique strengths of each brand. Simply put, co-branding as a strategy seeks to gain market share, increase revenue streams, and capitalize on increased customer awareness.

Co-branding can be spurred by two (or more) parties consciously deciding to collaborate on a specialized product. It can also result from a company merger or acquisition as a way to transfer a brand associated with a well-known manufacturer or service provider to a better-known company and brand. Co-branding can see more than just name and brand associations; there may also be a sharing of technologies and expertise, capitalizing on unique advantages of each co-branding partner.

Co-Branding Strategies

According to branding and marketing experts, there are four distinct co-branding strategies:

Market penetration strategy: A conservative strategy that seeks to preserve the existing market share and brand names of two partnered or merged firms.

Global brand strategy: Seeks to serve all customers with a single, existing global co-brand.
Brand reinforcement strategy: Exemplified by the use of a new brand name.
Brand extension strategy: The creation of a new co-branded name to be used only in a new market.

Advantages and Disadvantages of Co-Branding

Overall, co-branding will affect the bottom line as separate brands agree to develop and jointly promote an enticing, new product or service.

Benefits

When guidelines are followed, and execution is flawless, both brands are bound to benefit.

Each company is launching a product extension tailored to its loyal customer base yet geared to attract new business. An example of this is Nina Ricci and Ladurée.
When executed strategically and effectively, companies maximize exposure and enhance brand recognition.
Companies earn respect and credibility when they align with a reputable, aspirational brand partner.

Co-branding allows each invested partner to drive revenue, attract new customers, share the risk, and essentially double its advertising budget.

Disadvantages

Co-branding is built on the foundation of collaboration, and when completely different cultures collide, it might not always be ideal.

The agreement requires a lot of trust, guidelines to be followed very closely, and resources shared.

Most importantly, brands need to consider consumer reaction to this newly established partnership. Brand images can clash, and market segments can be misled if companies fail to demonstrate a seamless, sensible connection. For example, if a prestigious high-end brand shares voice with one perceived as mass-market or lower quality, the co-branding partnership can fail due to mixed messages and confused consumers. Examples of this are Lego and Shell or Custo Barcelona and Lidl.

In the worst-case scenario, the product could flop, the brand image can be tarnished, and the venture can be considerably costly.

Co-Branding Examples

Let’s explore some prominent co-branding case studies that provide like-minded brands with competitive advantages when focused on high-quality production and cooperative communication.

Starbucks & Spotify

In 2015, Starbucks complemented its Coffeehouse ambiance by teaming up with the mega music-streaming machine, Spotify.

As part of the agreement, Starbucks employees receive a Spotify Premium subscription, where they curate playlists serving as a musical background for coffee lovers to access through the Starbucks app. Spotify then provides these playlists “on-the-go” and offers discounted subscription plans, thereby attaining a plethora of new potential users.

Tail Piece.

Top line or Bottom line…it’s your choice.

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