How To Grow A Small Business Using Co-Branding

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How to grow a small business using co-branding

A small business looking to grow can leverage co-branding to drive massive growth.

Do you remember the strategic alliance between Nike and Apple in 2006?

Apple and Nike, which are power brands, came together to introduce the Apple Watch Nike+, pairing the amazing Nike Sport Band with Apple watch series 2 that has a lot of really cool features.

In recent years, businesses have taken brand expansion and market domination more seriously.

Is there any better way for an industry to become a big player in a niche or market they hitherto know nothing about than to synergize with an important and powerful player in that industry?

How about Uber and Spotify? This creatively thought out brand partnership had the target audience of both brands in mind. This strategy provided an avenue for Uber users to play their playlists when in a ride.

Here is how it works: when a user hails a ride through Uber, they are prompted to connect to Spotify so they can be in charge of the music playing in the ride while they are en route their desired destination.

In this article, we would use co-branding and brand partnerships interchangeably to mean the same thing.

What Is Co-branding Or Brand Partnership?

Co-branding is a marketing strategy that utilizes multiple brand names on a good or service as part of a strategic alliance.


In essence, Co-branding or Brand Partnership is a marketing or business strategy that involves any kind of alliance or partnership between two or more brands strategically designed to be used in creation (and, to an extent, marketing) of a new product.

So many of the new product “bundles” you see that contains signature products of more than one brand is simply a product of a well thought out brand partnership.

Brand partnerships always give birth to a new product or service which is complemented by a certain aspect of all the brands in partnership.

What Are The Types Of Co-branding?

There are two types of Co-branding – ingredient co-branding and composite co-branding.

  • Ingredient Co-branding:

Ingredient Co-branding makes use of a popular brand to serve as an important element or ingredient in the production of another popular brand.

An example is “Intel Inside”. The computer manufacturers used Intel processors for manufacturing those computers with Intel as an important “ingredient”.

Ingredient co-branding involves creating brand equity for materials or parts used in creating another product.

  • Composite Co-branding:

This refers to the use of two or more brand names in a way that they can produce a different product or service that would otherwise, be largely difficult for just one brand to pull off.

To pull this off great consideration should be given to how complementary each brand is to the other or how favorable one brand is to another.

Small and growing businesses can tactically employ co-branding with other brands to create a different product or service to increase their market share and grow their business even more.

Apple and Nike Brand Partnership
Apple and Nike Brand Partnership

Why is Brand Partnership Often Overlooked?

A brand partnership is often overlooked by small businesses because of a few reasons.

Below are some of those reasons.

Lack Of Proper Knowledge: truth be told, so many business owners do not even know that the term “co-branding” exists. This lack of knowledge about co-branding or even a shallow knowledge could make a small business pass on a wonderful opportunity to grow their business.

Fear Of Heavy Risk: what scares you the most in business? Every small and growing business is afraid of spending money that would not yield a great return. It is always advised that small businesses increase their profits and careless expenditure is not one way to make profits.

There is a certain level of risk attached to every business but this single fear of co-branding being a huge risk only comes from a shallow knowledge of co-branding or an experience gotten from a carelessly executed brand partnership.

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Lack Of Strategic Long Term Vision: the role of a business leader is to be the visionary of the business. If you have it in mind for your business to still be around for a longer period, you should give co-branding a chance.

With a clear vision of where the company is going, it would become clear to you if and when to implement the brand partnership.

Examples of Co-branding
Examples of Co-branding

Examples Of Successful Brand Partnerships Or Co-branding

  1. GoPro & Red Bull
  2. Pottery Barn & Sherwin-Williams
  3. Casper & West Elm
  4. Taco Bell & Doritos
  5. Kanye and Adidas
  6. BMW & Louis Vuitton
  7. Starbucks & Spotify
  8. Apple & MasterCard
  9. Airbnb & Flipboard
  10. Uber & Spotify
  11. Levi’s & Pinterest
  12. BuzzFeed & Best Friends Animal Society
  13. Alexander Wang & H&M
  14. CoverGirl & Lucasfilm
  15. Amazon & American Express
  16. UNICEF & Target
  17. Nike & Apple
  18. Bonne Belle & Dr. Pepper

Advantages of Co-branding

  • Introduces A New Product For The Audience Of Each Of The Brands Involved.

The result of co-branding is always a new product or service.

This makes it possible for two or more brands to lay claims of ownership to a particular product or service since they own it.

Customers are always intrigued when a brand introduces a new product to the market.

How about when a new product that complements each other by two trusted brands is introduced int the market? There is this usual; rush that goes with it with everyone wanting to try it out.

  • Saves Substantial Advertising Cost

When a business runs solo, they absorb every expenditure by itself.

With a brand partnership, the brands involved mutually absorb the expenditure that comes up in advertising that product they co-own; this, in turn, reduces the advertising costs for individual brands.

  • Improves Credibility

Imagine if your brand is loyal to your small brand and you partner with another brand that is somewhat bigger than your brand. How do you think your credibility would perform?

Credibility always increases when a smaller brand synergizes with a bigger brand over a product or service.

It also raises your brand awareness to help in growing your sales in the long term while increasing your brand awareness.

  • Broadens A Market Reach

Co-branding increases market reach.

When the concerned brands market or promote their products, their target market would not only accept the products for a start, they would also perceive the presence of another brand on the product. This, alone, increases the market reach of the other product.

  • Creates A Spillover Effect By Altering Brand Perception

Every brand has a certain way their target market or even people they don’t target perceives them; this creates a spillover effect.

A spillover effect is an impact that unrelated brands or products have on another product or brand.

A trusted brand would spill over that trust to a less trusted brand that partners with them to create something unique.

This happens often when a very large brand co-brands a product or service with a not-so-large brand. This is more like a character rubbing off on another person.

Examples of Good and Bad Co-branding
Examples of Good and Bad Co-branding

Disadvantages of Co-branding

If co-branding is done mindlessly or without due diligence, it could yield some bad results.

Without a carefully detailed legal agreement, co-branding would be characterized by long, lengthy legal battles involving the sharing of profits.

If the perception of the bigger brand is mostly negative, that negative perception would likely destroy the perception of the other brand.

Important Points To Consider In Co-branding

  • The integrity of both brands

Both brands must maintain a good image for co-branding to work its magic.

Brand integrity does not always have to do with the part that the public sees, integrity should be ingrained in the fiber of both brands.

When going into brand partnership, do your necessary findings to be sure that the integrity and perception of the other brand are not questionable. This saves you a huge headache much later.

  • Suitability For Target Audience

Every business or brand has its target audience.

The prospective product should complement each other and also suit each of their target audience.

For example, the Apple Watch Nike+ is suitable for Apple users and athletes who use Nike products.

Another striking example is that of Spotify and Uber. Everybody likes music but not everybody has the leverage of customizing their playlists while in a ride.

The important thing Uber and Spotify achieved here is to introduce a product that would benefit their target audience equally. This campaign is a massive success.

How To Grow A Small Business Using Co-branding

Let us get to how your small business can grow using co-branding.

Every small business aims to grow and rake in as much long term profit as possible. There are several marketing strategies to help achieve this feat but co-branding offers a rather more exciting prospect.

For your business to hit its goal with co-branding, let us look at ways it can leverage co-branding to grow.

  • Partner With Brands That Have The Same Values As You.

Working with someone can be great and exciting but it can also be an ultimate source of grief.

The best way to take advantage of co-branding is by partnering with a brand that shares the same values as you.

It becomes even more rewarding and easier to process when you both are working towards the same goal; in the end, your customer gets the best value.

Your brand growth can be fostered when you create that trusted relationship with the other brand you are working with.

If you must enter into a brand partnership, consider values and common goals!

  • Look For More Than Products

Customer service has since grown into “customer experience”. Seek to give a quality experience to your customers when partnering with another brand.

As a business, one of the important things to do is to understand your customer and how they respond.

Seek to enter into a partnership that not only projects a new product but an exciting customer experience just like Uber and Spotify or Nike and Apple. The experience is what matters.

  • Competitors? No. Allies!

Business, like war, is a strategy fight. Take no prisoners when executing tactically designed business strategies.

Instead of competing needlessly with another brand that is somewhat bigger, you should go into a partnership that would also advance your course.

Collaborating with your competitor is a strong strategy that may not be as appealing but can provide a platform for your small business.

  • Think Long Term, Make More Than One Partner

There is no law against having more than one brand partnership.

Always seek to create long-term collaborative relationships that are set up to benefit you as your business grows.

With this, you have trusted brands that would stand behind you when you critically need support. Business relationships are important.

The goal s is to grow your business and marketing is at the heart of it. A brand partnership is a great way of increasing brand awareness and credibility.

As a small business owner, seek out other brands you can partner with to drive a new product or service.

When handled rightly, this always benefits all the parties or rands involved.

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I am very pleased that you have described the branding strategies. Especially the brand partnership. This is so new to me. And still getting hold of it to understand better. But thanks for the tips.

Jesse Kanadi

Simply down to earth.
Great post.


What an interesting concept! I’m
Starting a small business so I’m going to be thinking about how to eventually use co-branding to grow it.

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