Co-Branding

Co-stigmatisation involves combining two or more brands into a single product or service. Companies engage in co-stigmatisation to leverage strong brand. It is becoming a popular business practice to strive for a positive association between different brands that can develop synergy. A well dead co-stigmatisation scheme can lead to win-win situation for both co-brand partners and can help in realizing undiscovered markets or unexploited opportunities. Concisely, it is instrumental to handle most every marketing matter from creating first awareness to building client loyalty.

Companies form co-stigmatisation alliance to fulfill following goals:

  MARKETING MIX

â–º Expanding client base

â–º To make commercial enterprise benefits

â–º Respond to the expressed and latent inevitably of clients

â–º To strengthen its competitive position

â–º Introduce a new product with a strong image

â–º Creating a new client perceived value

â–º To gain operational benefits

Co-stigmatisation is a often experient in fashion and apparel industry. Some of the examples of co-stigmatisation are between Nike - Phillips (Electronics Manufacturer) and Adidas -Porsche (car manufacturer). Co-stigmatisation can be used for promotion campaigns, to use cartoons on t-shirts, for victimisation logos, distributing through proprietary retail merchant etc.

Co-stigmatisation Agreements

In a co-stigmatisation alliance, both companies should have a dealingship that has potential to be commercially beneficial to both parties.

Co-stigmatisation agreement admits rights, obligations and restrictions that are binding on both the parties. It admits important commissariat and inevitably to be carefully drafted to give clear guidelines to the parities involved.

Agreement also explains about marketing scheme, brand specifications, confidentiality issues, licensing specifications, warranties, payments and royalties, indemnification, disclaimers, term and termination. Person involved in campaign must be very clear about these issues.

Co-stigmatisation can take following forms:

Promotion

Promotional co-stigmatisation is the most common type of co-stigmatisation practiced by companies. Co- stigmatisation starts with endorsements with celebrities and institutions. It can enhance brand image. Sponsorship can provide with ample opportunities.

Agreement with Supplier

Alliance with suppliers gives easy access to offerings and long lasting dealingships which leads to low level of investment. Distinctiveness is very important for such co-stigmatisation which is possible through patent protection.

Agreement with Value Chain members

It aims to give clients altogether new experience and enhance client value. In value chain co-stigmatisation, members in a channel both horizontally and vertically joined form alliance. Such co-stigmatisation can be between supplier-retail merchant, companies offering similar product or service or between product and service provider.

Innovation

This approach offer chance of growth in existing market and exploring new markets. In such alliance companies close to create new offerings for clients. Risk and return are two important aspects which need to be considered. Top level direction co-operation and organisational collaboration is essential for a made agreement.

Benefits of Co-stigmatisation

â–º Increased gross sales revenue.

â–º Exploring new markets with minimum expenditure.

â–º Appropriate approach when company seeks faster response.

â–º Access to new source of financing.

â–º Technological collaboration between two companies give better results than what could be achieved by single company's efforts.

â–º Royalty income.

â–º Sharing of risk.

â–º Companies can fetch higher price for value added by additive brands associated with it.

â–º Improved product image and believability with another brand association.

â–º Increased client confidence on product.

â–º Increased coverage and exposure from joint advertising.

â–º Prospects to develop working dealingships leading to future joint undertakings

Problems with Co-stigmatisation

â–º Proper understanding between co-brand partners is must. Greed to fetch overmuch in brief time may spoil the dealings and even result in failure.

â–º Once a co-brand take position in market, it becomes difficult to dismantle co-brand and even more difficult to reestablish the brand alone.

â–º Companies having different visions and culture are in-compatible for co-stigmatisation.

â–º If brand don't have enough believability in market, it can negatively affect the other partner's brand.

â–º Repositioning of brand by one party may adversely influence the other party's brand or campaign.

â–º When two products are whole different and have different set of clients, co-stigmatisation may not work.

â–º Inability to meet the requirements of other party may result in termination of co-stigmatisation agreement.

â–º Legal requirements.

â–º Mergers and takeovers of one party may prove prejudicial to other party.

â–º Future environmental changes like political, legal, social, and technological or changes in consumer preferences may give unexpected outcomes.

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