In today’s business climate, where mergers and acquisitions and new product launches frequently disrupt the marketing landscape, it’s more important than ever to understand the fundamentals of brand architecture and design a clear approach for your company and products. The implications reach far beyond brand names, logos and taglines to bottom line results.
Brand architecture is the plan for structuring your company’s image. Most companies follow one of two common brand architecture models: House of Brands and Branded House. Often, complex organizations mix the two models.
House of Brands
With the House of Brands model, individual product or company brands each have a strong presence and the parent company brand takes a back seat. You may not even recognize the connection between the parent company and individual brands. Examples include consumer brands like Proctor & Gamble (Tide, Pampers, Dawn) and Fortune Brands (MasterLock, Moen). Building multiple brands requires resources; It takes time, energy and investment. This strategy works well for organizations with significant marketing budgets that can invest in adequate support for each individual brand. It also makes sense for companies that offer products in different markets.
In the Branded House strategy, the overarching company brand is the main source of identification. Examples of this architecture include Virgin and Apple, where diverse products are marketed under the company brand and draw their strength from it. Many smaller organizations use this strategy because concentrating resources into a singular brand is more economical and simpler.
Which Model is Best for Your Brand?
Economics alone, however, shouldn’t dictate your strategy. It’s also important to consider the existing brand reputation, target market, products and goals. For example, when Toyota wanted to enter the luxury car market, instead of simply offering a new luxury model under the Toyota brand, it created an entirely new brand: Lexus. Separate brands (House of Brands model) enable distinct, independent identities.
Sometimes as companies grow they acquire new brands and this can create brand confusion. This was the case for one of our clients, Wausau Equipment Company. It had undergone ownership changes and was marketing similar products using seven different identities. See how we helped them realign their brand and craft a stronger, more cost-effective marketing strategy.
Is your brand strategy in need of a review or a fresh outside look? Contact Responsory for details on our brand positioning workshops.