Launching a new product under the umbrella of a brand lets you take “cuts in the line.” Branding is a cost cutting tool, not a revenue enhancing tool. (Okay, much later it is a revenue enhancing tool too! But not at first.)
I think branding is about cutting your costs of a new product introduction. Branding is a long term investment, not short term cost to juice product sales.
No, the objective of branding programs isn’t to sell product. The goal of a brand program is to build brand name equity, so you can introduce new products less expensively. Your target market has already heard of you, so you’ve got “trust” and “innovation” and “high quality” already mapped out. (Assuming that’s what your brand stands for.)
In essence, you jump ahead in the mind of your target market. The better the brand, the farther you jump.
By launching your new product under the umbrella of a brand, you don’t have the enormous start up costs of all the new product marketing. You can add the new product to your line. What a difference. You start out familiar.
On the other hand, if you continue to introduce one new product after another, without the advantage of building a brand name first, you have to break through all the clutter that bombards your target market and then get their attention. Wow. That is $$$$$ expensive.
Another way to do to jump the line, is to “borrow” the equity of another brand. You know, license someone else’s brand name. It’s faster, but doesn’t help you long term.
The advantage of a brand is the target market will have some familiarity so you can start up higher in the stair steps of the purchase cycle. You know how people have to hear about something many times before they take action? Well launching a new product under a brand umbrella gets you started on the 3rd floor or even 4th floor instead of the basement. It may take a lot of little steps before they’re ready to buy.
Can you think of a product that wouldn’t have “made it” on it’s own? Or at least wouldnt’ have made it quickly, without it’s brand? Please leave me a comment with an example. We’ll see if you and I are thinking of the same product!!
By investing in your brand as opposed to spending on individual product, you build value long term. Equity. It’s like buying instead of renting.