Saturday, September 12, 2009

The Co-Branding Route

Some of you might remember a time few years back when there was a plethora of co-branded cards hitting the market. Almost every day, we found pics of well dressed dudes (never ladies- but well, that's a different story) hanging on to huge plastic cards and smiling down from the newspapers- card companies and petrol firms, airlines, banks, everyone jumped on the bandwagon. Don't know how many of them survive now.

But what I am really talking about here, is the co-branding concept, which has a lot of potential beyond just co-branded cards. Apart from what you will read in books, it's basically two corporates with similar synergies, coming together, to start an initiative, in which both of them stand to gain EQUALLY. This never works if each one is getting less than the other.

Sometimes it takes the form of a barter route. You take my goods in lieu of which I take yours. Airlines tyipng up with corporates to give away the perishable seats or hotels doing the same in lieu of their products, come under this category. This could however lead to some creative accounting complications unless handled carefully.

Another could be a scenario where a chocolate manufacturer piggy backs on a bisuit company's channel route - similar target audience- to reach out more widely, while sharing the advertising costs.

A mobile manufacturer can tap the rural markets through a tie up with TV production companies or even bicycle manufacturers as TV / bicycle are No. 1 purchases of a rural household once they start generating disposable income and well, mobile can well be No. 2 with its gaining functional prominence. They however need to figure out how they would compensate each other.

In India, there are a lot of firms which can gain through this marketing tool. You just need to put your mind to it.