When entering a new market a common strategy to take is co-branding.
Cobranding is a marketing partnership between at least two different brands of goods or services. Cobranding encompasses several different types of branding partnerships, such as sponsorships, to achieve mutually beneficial goals.
When testing your brand in new geographical locations co-branding allows you to build awareness and marketplace exposure to give your brand the best chance of success on arrival.
Joining two brands together can be extremely powerful. Picking out the strengths from each retailer is a great way to drive further engagement from existing consumers and attract new. Co-branding can be a win : win for both retailers, brands can immediately capitalise on each others consumer base to increase awareness and visibility to new audiences and demographics – ultimately generating new sales and building loyal customers quickly.
It is of great importance to partner with a trustworthy, reliable brand. If the customer experience isn’t delivered as promised or as expected, it can really affect the future of your company in the proposed market. It is also a risk for the company based in the local market, if the consumer reaction to the merge is negative, their association with the new brand will put their reputation in danger. To ensure the relationship is a success, both parties involved need to be transparent and share the same values across all aspects of the business, if either company receive bad press or complaints both brands run the risk of being tarnished with the same brush – On the reverse, if one brand receives positive publicity, both brands will reap the benefits.
Working with another retailer reduces costs as you can share resources, and split the cost of the product creation, advertisement etc. This is a great benefit of co-branding as entering a new country is an expensive, high-risk investment. Sharing resources delivers the opportunity to create better quality and more innovative products. This opportunity allows you to influence the consumer’s opinion of the brand and gain the markets trust and interest before you completely enter the new location.
When customers see a new brand they are often sceptical. Promoting your brand alongside a distinctive retailer in the local market before arrival will encourage favourable associations to be made. This ensures when you enter the marketplace and begin to trade, you have already positioned yourself, meaning not only are you recognisable, but have started to build a strong brand image and client base.
If you create a brand alliance with a strong retailer who is dominant in the market and shares the same values as your brand, it can highly increase your chance of success and encourages longevity in the new country. Working together to introduce a new product or offering, at the right time, in the right place with the right promotion = success!
Katrina Whitehead, Marketing and Operations Executive, Foundation Recruitment