A case in point is AOLTimeWarner, whose plethora of brands spans across
Time, Fortune, Business2, People, Money magazines, America Online, Warner
Music, and CNN, to name some. Recognized by its independent identity and
target audience, each brand maintains an online territory of its own that
conveys individual character, spawned by the design, content, and domain
name. There is a very little - if any - feel of and reference to
AOLTimeWarner as the parent brand.
Credibility of corporate brand
The positive image of a strong company brand can extend to and boost
the credibility of the products under it, especially those new to the
market. Sony and Philips for instance, capitalize on their long-held image
as trustworthy makers of high-quality and durable electronics to support
the marketability of their products. Furthermore, this strategy serves as
a competitive advantage when launching products of either little/ no
innovation, without meaningful features in the consumers' eyes, or of
major innovation. Consumers will associate the 'useless' products with the
company brand, hence they will be more receptive to the marketing message.
In a similar vein, when encountering major technological advancements such
as plasma TV or MP3-capable stereo, consumers rely on the trustworthy
corporate brand to unload the burden of dissonance off their back when
considering trial or purchase.
The power of a strong corporate brand is even visible in company with
multiple brands as demonstrated by CNET, which incorporates its well-known
name into less popular sub brands under its network -- News.com,
Search.com, Download.com, Shopper.com, CNET Radio -- to boost their
credibility. You can instantly get the 'feel' of CNET when logging on to
any of these sites as they essentially share the same colors, layout, and
navigation. News junkies are ensured of the credibility of content
presented by News.com, which bears the CNET logo of trustworthy brand of
network of technology-related sites.
Ironically, the strongest point of a company brand is also its weakest
link. Relying on a single brand can do widespread damage across sub brands
in catastrophic episodes, even when only one product involved. In the wake
of Ford-Firestone tire debacle in 2000 for a while both companies were
down in the toilet with eggs on their face, despite the exclusivity of the
mishap - Firestone Wilderness AT tires on Ford Explorer.
On the other side of the spectrum, individual brands can stay virtually
unscathed when their corporate parents stumble upon mishaps. The downward
spiral that illustrates AOLTimeWarner's image since the completion of AOL-TimeWarner
merger in early 2001 does little harm to its brands; the general public
sees Fortune and Warner Music as separate entities with their own image
and characters, without drawing any reference to the fact that
AOLTimeWarner has become an example of a failed mega merger.
Association to established brand
It is more practical and easier to launch an individual brand when not
operating under the shadow of corporate brand - particularly in the wake
of a disastrous event that hurts the image of the company. The new brand
can be safely introduced to and accepted by the market without the fear
for consumers' associating it with the corporate brand under crisis.
This advantage has been enjoyed repeatedly by consumer-goods companies
such as P&G and Unilever. P&G exploits the potential of emerging markets
in South America and Southeast Asia by creating regional brands, without
noticeable connection to the image of P&G and its other brands in the
United States and other countries. Furthermore, except for those in
business and economy sector, probably nobody has no idea what P&G is or
what it does, or what company makes their laundry detergent.
Conforming to the unofficial but widely existent phenomenon that no
school of thought can be valid at all times, the two branding strategies I
am proposing here are subject to a set of constraints -- current condition
of market, nature of business, and consumer, economy, and social
environments. The persistent success of Sony in sustaining mind share as a
household name in advanced and long-lasting electronics, may justify the
option of going with company brand. Yet for more than fifty years Nestle
and P&G, and now AOLTimeWarner, have proven that settling down in the
background and instead diverting the spotlight to a set of well-managed
individual brands, can be a lifesaver during times of crisis.
Johann is an Internet Marketing Consultant at Microsoft The
Business Internet Competency Center in Jakarta, Indonesia. You can reach him via
email at independent@excite.com or
visit his company's website
http://www.mbicc.com and his online branding e-zine
http://www.pranala.com
