Deep diving into the determinants of how brands can influence one another. The good and the bad.
Something I have been asking myself recently is, to what extent do other brands and the brands of players influence the clubs brands?
Through my post on Determinants of a successful brand – consumer relationship I realised that brand strategy and brand equity rely heavily on brand alliances, sub-brands, sponsors, and co-brands. The concept of ‘borrowing’ equity from another brand by establishing a mutual product or service is not new. However, the extent, strategies and complexity of co-branding, especially in a sporting context, have reached new heights. Clubs are incorporating co-branding into the brand strategies in order to maximize competitive advantage and create a synergy. Hill & Vincent (2006) recognize that synergies are being practiced through sponsorship deals, player transfers, merchandise outlets and pre-season tours. Although co-branding is a proven tool in building brand equity, there are concerning contradictory empirical studies on “how brand equity transfers between brands and how this has an impact on the individuals brand equity” ( Tsiotsou,2014). Founding studies explaining sports co-branding relied heavily on cognitive theories, such as Associative Learning, Attribution Theory and Awareness-Trial Reinforcement model. Yet, within the context of sports branding, more recent studies view such explanations as insufficient. In the last decade an emphasis has been put on studying affective perspectives. Thus, contemporary studies consider affective conditioning, classical conditioning, mere exposure and hierarchy of effects of sports sponsorship. Tsiotsou (2014) divided the effects of sports sponsorship into three stages; perception/awareness level (i.e.image transfer), cognitive/rational level (i.e.meaning transfer) and affective/attitude level (i.e.attitude transfer). In disagreement, Walliser (2003) review into sponsorship research found no definite principal methodology in empirical research.
Most recently, Tsiotsou et al. (2014) sought to explain co-branding in the context of sport sponsorship through evaluative condition framework. Unlike the mentioned studies, which concluded that co-branding is a versatile tool with varying levels of benefits for the partners involved, Tsiotsou et al. (2014) conceptual model[1] evaluates the process and levels of co-branding (Tsiotsou,2014). The model is based on Associative Learning Theory – whereby attitudes are formed through information processes – and Evaluation Conditioning – whereby attitudes are formed when brands are paired. The Evaluative Condition study aligns with previous findings, stating co-branding has significant influence on consumers relationship with the host (higher brand value-usually sports brand) and partner (lower brand value-usually sponsor) brands. However, considering that Evaluative Conditioning suggests the reverse effect – the host brand likewise was found to receive small, yet significant benefits. This belief dismisses previous research, which found that co-branding has no effect (positive or negative) on the host brand. Therefore, making co-branding with similar calibre brand equities irrelevant as consumers opinions of the brands wouldn’t alter.
Appendix 1
Regarding the transition of brand equities in a co-branding context, some studies overlook the emotional factors. Others view these factors as crucial. Thus, the stronger the consumer-brand relationship the more the partner brand will experience host “brand-equity-relevant behaviour and increased word of mouth”(Tsiotsou et al.,2014, p. 316). To illustrate, a study on Manchester United (MU) found that their co-branding with airline AirAsia was a win-win strategy. MU increased their competitive advantage in the Asian market through increased exposure, increasing financial benefits, while AirAsia’s MU-themed liveries capitalized on the MU brand equity, thus increasing their own. Many of the most successful co-brands are established through unconventional synergies.
Similarly, a study on the benefits and risks of strategic brand collaboration[2] identified financial, functional, emotional and/or self-expressive benefits, for both partners. It can therefore be claimed that emotional factors are important when considering co-branding. Co-branding can enhance the clubs self-expression (defining brand salience) making the consumer feel they are represented-like in the case for AirAsia. The host co-brand must have high levels of emotional and self-expressive qualities, in order to transfer emotional factors.
Appendix 2
However, if mismatched the consequences of mismatched co-brands values and personality should not be underestimated. Identified risks associated with co-branding are;
(1) Brands can lose control over their brand’s identity, values and other alliances. In sports this most commonly happens between players and the team. The unpredictable nature of human behaviour makes clubs particularly vulnerable when co-branding with a ‘living brand’.
(2) Brands must complement each other, either with personality or origin, or risk losing image, due to confused positioning and consumer targeting.
(3) Over-use of co-branding can have a reverse effect, whereby the brand image is distorted. This is apparent when working with living brands. Thus, brands should where possible co-brand with exclusive brands, only collaborating with one brand at a time.
(4) Reduced leverage points for the future. Borrowed – unlike built – brand equity is a limited asset, and therefore cannot be leveraged by the host brand in the future.
The above highlights co-branding as a robust and adaptable tool to increase brand equity, yet it indicates potential risks. A thorough screening process, should help minimise risks and increase potential for successful alliances. Nonetheless, much research suggests a need for further investigation into co-brand fits and the uniqueness of sports co-branding to understand what makes them successful.
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