Brand architecture allows the business to achieve leverage, clarity and synergy by optimizing certain hierarchy linkages that help identify systems in a portfolio. Brand architecture is divided into three categories:
A brand name houses one brand that encourages offer values and purchases. For example, FedEx. There are different brand names under this brand such as FedEx Freight, FedEx Ground, FedEx Office and FedEx Trade Networks.
House of Brands
The name of the brand is not at the forefront and the product’s name is the only identity. For example, Proctor and Gamble (P&G). The products under P&G, which most people assume are a brand name itself includes Olay, Bounty, Gillette and Crest.
This is a combination of branded house and house of brands. For example: Marriott. Names that fall under this brand are Sheraton, Westin, Marriott Rewards, Courtyard, etc.
Why is Brand Structure Important?
The strategy behind choosing brand architecture is not about how the business is structured or its corporate naming system. It’s about telling the consumer how they must perceive the relationships and links between the portfolio. At the end, the right brand architecture will maximize brand input in the target group and a branding agency such as BrandMatters can help you come to a conclusion, which structure to choose.
For example: when WhatsApp was purchased by Facebook, the latter brand decided to keep its name separate and the former brand continued in the same way. This increased the brand’s equity within and outside the business.
Advantages of Brand Architecture
If the right brand architecture is chosen, a brand can achieve success and reach new heights in just three years. Following are the advantages of brand architecture:
- It ensures that business is running smoothly by keeping track of all the other brands and products under it
- It allows the brand to enter the market from every angle and this way, they are able to keep up with the currents trends and different markets
- A single brand is able to document different strategies, which helps it during decision making
- The difference between an unsuccessful and a successful company is its brand architecture
For example: say you recently had a merger and acquired a certain brand that has a negative reputation in the market. By choosing the house of brands structure, you will b able to keep the parent alive and untarnished and at the same time, work on the acquired brand to bring it back to the top.
- Brand architecture helps keep a balance between all the sub-brands and the main brand (the sub-brand needs to be organized or else the parent brand will take a hit when the sub brand will experience a loss)
- With the help of the brand architecture, the business is able to decide what product to launch and where. If the customers are more attracted towards the sub-brand, the product can be introduced as an extension and both the parties profit from it
A brand can survive in the market longer if the brand architecture supports the portfolio. The parent brand always remains at the top and is responsible for all the sub-brands. When the parent brand takes a decision, it affects all the sub-brands.
So, choose the brand architecture wisely.