Every business strives to acquire the biggest share of its targeted market. It’s not uncommon for businesses to create new products or offer new services with a different brand name, And this is where multi-branding marketing comes into play. In this article, we will explain the basics of the multi-brand strategy and share some tips on how to successfully implement it for your business.
What Is a Multi-Branding Strategy?
Multi-branding strategy refers to a practice in which one business creates and promotes multiple brands within the same market. This approach helps companies target all customer segments as different services with different marketing styles cater to every individual in their own way. One famous example of a multi-branding strategy is Meta (Facebook) – it owns Instagram and WhatsApp which are both mobile applications but don’t have the name mentioned in the brand’s title. Another example is FedEx which uses its brand in the title of each separate service such as FedEx Cargo, FedEx Office, etc.
Whether you use the same parent company name for your product or don’t want to mention the parent company in the title, all of these brands should be managed properly and, moreover, separately. A multi-brand marketing strategy allows businesses to ensure their brands are positioned and promoted within the same market addressing separate target audiences without creating internal competition.
Benefits of a Multi-Brand Strategy
Like any other strategy, multi-branding has its own advantages and downsides. Let’s start with the pros:
Better Brand Visibility
When your company is introduced in several market segments and targets different audiences, people are likely to see your name more often. And on top of more frequent public appearances, you’ll get a wider reach in general – more people will be able to explore your brands. As a result, you increase your brand awareness and sales.
Benefit From Previous Success
If your previous product is in demand and gains some traction within your target audience, your new brands and products can feed with the success you’ve already achieved in the same or related market segment. Newly launched products from an already existing company are likely to be more visible to customers rather than a product introduced under an unknown name.
Risk Diversification
Having various brands might help you diversify your business and reduce your risk. Your other brands can continue to generate money and maintain overall business stability even if one brand is having problems or seeing a fall in sales. By diversifying your business, you can prevent your company from relying too much on the success of a single brand.
More Options For Customers
Modern clients want to have more options and choices within a single market. When introducing new brands you give your customers an opportunity to switch between your products rather than leaving you for a different company. A good practice is also to smartly integrate your brands with each other so that when one product is bought, another one of your products can be bought as well as a supplement.
More Space For Experiments
More brands usually means more flexibility to create and experiment with your product/service line. You’ll have more freedom to take measured risks and investigate new options since if one brand’s innovation doesn’t provide the expected results, it won’t have a catastrophic effect on the entire organization.
Multi-Brand Strategy Disadvantages
Here are some struggles you may experience in your multi-brand marketing efforts:
Lack Of Focus
Having multiple brands inevitably comes with the need to divide resources and attention between them. If done right, it will never be a problem, however, many businesses have struggled to stay focused enough on the objectives of their individual brands. It can be difficult to devote enough money, effort, and knowledge to each brand, which could result in missed opportunities or less-than-ideal performance.
Increased Marketing Costs
Operating numerous brands also comes with an increased cost with regard to marketing and administration. Each brand needs its own marketing initiatives, brand building, distribution networks, and infrastructure for customer service. These expenses may mount, particularly in the absence of adequate economies of scale or resource sharing among the brands.
Cannibalization
When many brands within the same portfolio target comparable customer segments or provide comparable goods or services, there is a danger of cannibalization. Loss of market share and decreased profitability may result if the brands compete with one another rather than enhancing one another’s proposals. Additionally, managing too many brands can confuse consumers and diminish brand equity, making it more difficult to establish distinctive brand identities.
Loss Of Customer Trust
Sometimes businesses that implement multi-branding become more focused on profits rather than clients, resulting in potential reputational risks. If one brand in the portfolio suffers from a reputational problem or receives unfavorable press, it may have an effect on the parent company’s reputation and the trust of other related brands. Thus, reputation risk management and proactive monitoring are some of the most essential parts of multi-brand marketing.
How to Manage Multiple Brands to Succeed?
The advice here is clear and straightforward – marketing strategy for different brands should be created and implemented separately. When you introduce a new product to the market, it doesn’t mean that the marketing approach for your previous release will work. Here are some steps to follow with your multi-branding marketing.
Create Landing Pages, Sites, and Domains
New brands require a proper presentation. If you want to launch a product using the same parent brand name, a separate landing page on the official site will be enough. However, if you are planning to introduce a product within an adjacent market, a new website is a must. It will allow you to attract as much attention from customers as possible, specifically to the new product. Along with the new site, your product will need a separate email domain to reach out to your clients and partners.
Connect Your Brands
Connecting existing and new brands allows you to leverage your current business capabilities and apply them to the new market segments. For instance, Instagram provides a possibility to connect your account with your Facebook profile, thus allowing your friends to find you in the new app. The same strategy can be applied to other types of products.
Cross-Promote Your Brands
Once you’ve connected your brands, figure out what they have in common and what makes them different from each other. Then use that knowledge to selectively cross-promote your brands, integrating them with each other not just in terms of functionality, but also marketing. Cross-promotion is great at utilizing existing brand loyalty and increasing interaction with other brands in your portfolio.
Create A Unique Message For Each Brand
Each of your brands needs to possess a distinguishable identity to stand out from the rest in its own way. Make sure that your messaging and communication style are tailored to that distinct identity. Create enticing brand narratives and value propositions that appeal to each brand’s target market by directly addressing customers’ problems and providing solutions.
Enable Marketing Automation
Marketing automation software makes managing multiple brands look effortless. Such powerful solutions as Salesforce and HubSpot save a tremendous amount of time by automating routine tasks and providing full visibility of all the marketing processes. They also offer great analytics and reporting capabilities, allowing you to make informed decisions.
Some businesses may be put off by many difficulties that come with the integration of the software; however, marketing automation experts like OMI will make this process as smooth as possible and will be there with you every step of the way.
Create Impactful Ad Campaigns
New products should be powered by strong multi-brand marketing campaigns that address different market segments and audiences. Try not to rethink previously launched campaigns but rather create new ones aligned with your new business goals.
Make Use Of Analytics
Utilize data and analytics technologies to measure and assess the effectiveness of your multi-brand marketing initiatives. Keep an eye on KPIs like brand awareness, customer growth, engagement, and conversion rates. Make data-driven decisions and optimize your tactics with these insights.
Final Thoughts
When launching various products into the same market, multi-brand marketing will be a crucial component of your business plan. Multi-branding will help to improve your company’s overall marketing strategy as long as you are clear about what your new brand stands for and the demographic it is intended for.