So confident have I become in this answer that I’m considering printing it onto an A-frame board and wandering around the streets wearing it.
We’ve written and podcast loads on the issue about products, portfolios and brand architecture more broadly, but I don’t think I’ve ever written a piece about sub brands specifically.
The first thing to say is that I completely understand how it happens and why it seems to make sense. It’s one of the curses of marketing that the temptation to ‘be creative’ and create something new is very alluring. That’s why we write (in another piece) about discipline being one of the most important factors in modern marketing. It’s not about being creative (that’s not marketing’s job) it’s about being commercial, consistent and sensible.
But be warned. It’s a slippery slope, and once you’re past the sugar high of creating something nice, shiny and new – that’s when things get tricky. Here’s my list of watchouts and observations on why I think sub brands are not the answer in the B2B space.
B2B v B2C
There’s a reason companies in the B2C space adopt House of Brand structures (e.g., P&G). They have many millions of consumers which means the market can support multiple brand offerings across different sectors. The B2B brands we work with tend to have much smaller customer bases, focussed in niche sectors which means they don’t need multiple brands.
It’s Probably a Product; not a Brand.
What’s the difference? Good question. Brands are things that transcend the functional role the product or service plays. They embody the intangible aspects of a business, including its mission, vision and values, which build up a set of associations in a consumer’s head that (in time) can affect purchasing decisions. It takes a lot of time and money to first define these intangible elements and establish the associations in consumer’s heads. So, if you’re not going to go all in and invest in the brand, it’s probably better to label it as a product and slot it into the existing portfolio.
As above, it’s time consuming and expensive to define a brand and build it. And once it’s done, you must maintain it. That means people, websites, packaging, events & stands, social media feeds - the list goes on and on. Brands are like spinning plates…you have to keep tending to them and investing, or they’ll fall off. All these costs are incremental to the costs associated with the main parent brand.
Manpower and Expertise
In addition to the cost, it takes a decent amount of experience and knowledge to manage brands well. A lot of it is common sense, but as we know, common sense isn’t very common, and you’ll need to find people who know what they’re doing. That can be challenging. In our time, we’ve seen people placed into ‘brand’ roles with no experience or understanding of what’s really required, and we know how that film tends to end.
Setting a Precedent
Once a sub brand’s been created, it’s easier for others to do so again. Soon, you’ll have HR creating a stand-alone employer brand and IT designing logos for their branded fleeces. Again, the point about made about discipline.
Create too many sub brands and people get confused. Customers drift to the competition where it’s easier to buy, and staff become frustrated. This is the most common complaint we get from stakeholder groups when we’re brought in to consult. And from this point forward it tends to be an inexorable march toward simplification and consolidation.
Chances are you’ll have some brand equity in the main brand. And that means something to a consumer. Why throw all of that out and start again? (see cost point above). Better to piggyback on it. Think of it this way…when Coke invented a sugar free version of Coke, they didn’t call it ‘ZeroSweet’; they called it Diet Coke.
Never Seen One
I started this business 20 years ago, and in that time, I can honestly say that I’ve never seen a B2B client run a ‘sub-brand’ successfully. Contrast that to the hundreds of sub brand (products) we’ve re-integrated into a main corporate brand across scores of projects. I guess that says it all.
In summing up, I’m not saying that the creation of a sub brand is never the right answer. Of course, there will be occasions when it does make sense to build something new. What I’m saying is that in B2B particularly, these occasions are relatively rare and should be underpinned with some solid strategic thinking.