Introduction
Brand loyalty is the extent to which consumers repeatedly commit to buying a particular brand. It is a crucial aspect of brand management as it directly impacts a company’s profitability and market share. Co-branding, on the other hand, is a marketing strategy where two or more brands work together to develop a particular product or service. However, specific issues should be considered when using co-branding. This paper aims to discuss the key degrees of brand loyalty, provide examples of products, explain co-branding, and highlight the significant problems associated with this concept.
Brand Loyalty Degrees
There are three significant brand degrees of trustworthiness, which include brand recognition, brand preference, and brand insistence. In this context, brand recognition is the lowest level, where consumers know the brand and can identify it among competitors. However, they do not have a strong preference or attachment to it. Thus, Coca-Cola is a globally recognized brand. However, this does not necessarily mean consumers will always choose Coca-Cola over more cola brands. At the stage of brand preference, consumers view the brand as superior to others and are more likely to choose it when making purchasing decisions.
Apple is a prime example, as many consumers prefer Apple products, such as iPhones and MacBooks, instead of similar brands due to their perceived exceptional quality and design. Finally, brand insistence is observed when consumers are wholly committed to a particular brand and refuse to consider alternatives (Pride & Ferrell, 2022). They have a strong emotional attachment to the brand and are willing to go out of their way to buy it. Nike is a brand that has achieved brand insistence. Many sports enthusiasts are loyal to Nike and insist on purchasing their products for their performance, style, and association with top athletes.
Co-Branding
Co-branding is a strategy in which several brands interact to create an artifact that leverages the strengths of each brand. It is a way for brands to increase their visibility, reach new markets, and improve their brand image. First, partners must have a strong brand fit. The brands should complement each other regarding values, target market, and positioning (Abedsoltan et al., 2022). For instance, the collaboration between Spotify and Uber is a good example as they address young, tech-savvy consumers and share a common goal of providing convenience and enhancing experiences. The partnership allows Uber riders to control the music during their rides through the Spotify app.
Second, co-branding can also lead to brand dilution if not executed carefully. When two brands come together, there is a risk of diluting each brand’s essence, confusing consumers, maintaining brand clarity, and ensuring that the product aligns with the brand’s core values (Abedsoltan et al., 2022). A successful case is the partnership between GoPro and Red Bull. Both brands are associated with adventure and extreme sports, and their collaboration on content creation and distribution has enhanced their brand image without dilution.
Conclusion
Brand loyalty plays a crucial role in a company’s success. Co-branding involves collaboration between two or more brands to create practical goods or services. While brand partnerships can be beneficial, factors such as brand fit and dilution must be considered. Companies can strengthen their brand image and gain a competitive advantage in the market by understanding and effectively utilizing brand loyalty and co-branding.
References
Abedsoltan, H., Taleizadeh, A. A., & Sarker, R. B. (2022). Optimal production of remanufactured products with collaboration and co-branding of luxury brands. Computers & Industrial Engineering, 172, 108533.
Pride, W. M., & Ferrell, O. C. (2022). Foundations of marketing (9th ed.). Cengage Learning.