While there are many different models of designing brand architecture, this article will look at two approaches: branded house and house of brands. While a house of brands contains independent, unconnected brands, a branded house uses a single master brand to span a set of offerings operating with only descriptive sub-brands. These two models vividly describe the two extremes of alternative brand portfolio strategies.
A good example of a branded house approach is Richard Branson’s Virgin empire. The business varies from record shops, credit cards, an airline, and so on. Their product lines are all wrapped into a single identity, using a single master brand to span a set of offerings operating with only descriptive sub-brands. The company is the brand, and all products draw their energy from the single brand identity. Virgin puts their label to every product.
This is an efficient method and provides consistency. It provides a centralised value, given that all products and services are centrally branded. The advantage of a brand house approach is that all the products and services can share the same budget, customer, and market position. Inherited attributes can include visual identity, messaging, values and customer perception. However, this approach limits the degree in which a product or service can be uniquely marketed. This sharing can limit business’s flexibility and reduce its ability to adapt quickly to changing market conditions and opportunities. Also with all the products housed under a single brand, the shortcomings of one can have damaging perception effects that can ripple across the entire portfolio. The negative impact is more likely to hinder all company entities.
On the other side, the house of brands separates the company into various sub-brands. Each product line is a stand-alone brand that is specifically positioned in a particular market segment independent of other brands in the company. Let’s look at the Dutch giant Unilever who owns around 400 brands. Their brands range from luxurious hair treatments, mouth-watering ice creams, low-cost nutritious foods, antibacterial soaps to germ-killing sprays. Each set of stand-alone brands focuses on maximising the impact on the market. In doing so they sacrifice the economies of scale that come with leveraging a brand across multiple businesses; each brand needs its own brand-building investment. This is generally more expensive and complicated to manage. However, each brand is free to fight its battles on its own terms and reap in their unique benefits.
LiveBackup has applied an innovative branding strategy in the digital era that uses the house of brands approach to develop new brands which target specific market segments. The aim of the strategy is to deliver the precise content for the particular online searches. Solutions provided by LiveBackup are designed for particular industries or particular customer needs.
Analysis identified that there are 12,000 local monthly searches for the term “server backup”. ServerBackup is targeted at people who have limited knowledge of backup techniques. The aim is to educate the audience by providing information on the different methods of backup, such as tape backup, onsite solution with a local backup, USB or online backup. Some solutions are more expensive than others, but so is the value of data and this is part of the task of educating website visitors.
The approach has some primary objectives of owning the domain “real estate” along with developing exact content based on user search. The sites www.sqlbackup.com.au, www.legalbackup.com.au and www.serverbackup.com.au were produced, guided by the knowledge that most people doing searches on the Internet are there to make very fast decisions. Upon landing on a particular page the visitor very quickly knows if they’ve succeeded in finding what they are looking for. So, content became the key. Finally, adequate web domains were purchased in order to rise to the top of the organic based search results.
The Internet changed the way brands develop and evolve. LiveBackup had a vision of market segments where potential business and competition could derive, which became the primary motivator behind the digital brand house – domain approach. The marketing technique that LiveBackup employed aimed to capture different market segments through the purchase of adequate web domains. Market segments acquired included: geography, technology, industries, devices, channel and application. Attaining these web domains was crucial for LiveBackup in order to ruse to the top of the organic based search results. The careful selection of market segments and domain names has yielded results by allowing LiveBackup to deliver content, without the need for excessive advertising.
For a resource packed and intriguing case study on how LiveBackup developed its innovative strategy, take a closer look at BrandState.♦ End