Brand architecture is an important concept, and you must understand it to grasp the meaning of branding itself fully. Just like in normal architecture, different components combine to form one whole building; brand architecture is the same. It is how various brands created by the parent company are connected to the main company or brand. The brand architecture shows the structure of the various brands created by the company and their affiliation as well. Therefore, it is the concept of how all of these brands within a company are connected and how they interact. Let’s further dive into how this concept works and how it can benefit your business.
Why is Brand Architecture Important?
Brand architecture helps communicate your brand to your target audience in an organized manner. It helps the target audience clearly understand your brand as everything is arranged and presented.
With the master brands and multiple sub-brands, the company can generate a lot of revenue through cross-selling. If any of the sub-brands has a positive impact and is bringing higher sales, it will, in turn profit the company.
Brand architecture is essential to the brand equity of a company. The brand architecture will eventually drive growth and generate more revenue, which benefits the parent company. Moreover, the overall culture of the company is improved with such organized practices.
By creating a brand architecture, you are not only increasing benefits, but you are also protecting your company from serious damages. The impact can either be shared and compensated, or the negative impact or loss of one brand does not affect the other. The result depends on the type of architecture your company is based on.
When you have a clear and organized system, it will help you adapt to changes quickly over time. The business world keeps going through changes, and many external factors can positively or negatively influence the organization and its brands. A brand architecture will ensure that everything is dealt with and necessary changes are implemented.
Types of Brand Architecture
Following are the most important types of brand architecture are:
– House of Brands
– Branded House
– Endorsed Brands
– Hybrid Brands
House of Brands
House of Brands is a brand architecture that aims at protecting all the brands of the parent brand. None of the brands would be affected by the other neither in terms of profit nor in terms of loss. In the House of brands, the master brand can have many competing brands in the same category without them being influenced by each other.
For example, Proctor and Gamble is a parent brand with multiple small brands. If one of these brands incurs a loss, the others will remain unaffected by it. Similarly, if one of the P&G brands benefits, the other brands get no benefit from it. Benefits could be monetary terms or just a general rise in the popularity of the brand, which in turn leads to monetary benefits.
Therefore, each of these brands is unique in its concept and is not strictly related to the parent brand or one another. The differences can be seen through the varying names, logos, packaging, etc.
Branded House
A branded house is a brand architecture, which is the opposite of a house of brands. In this, the brand extensions or the sub-brands are all very strongly linked to the parent brand. This indicates that an opinion about one of the extensions can form an opinion of the entire family of the brands. Even if the individual brands provide different services than the parent brand they are strongly linked and are affected by each other. Which means that they would be connected in their profits and losses.
In a branded house, the master brand and all of its extension brands have the same logo, brand name, etc. For example, all Apple products are identified by the same logo and brand name that is Apple. The Master brand influences the reputation of any of the individual brands. The increase in publicity and sales benefits all of the brands within this architecture.
Endorsed Brands
Endorsed Brands is a brand architecture that is a mix of both houses of brands and branded houses. In this architecture, the child brands are allowed to have their identity while still being associated with the parent brand. This gives the child brands to create their brand strategy while still enjoying the equity of the parent brand.
The reputation of the parent brand influences that of the extensions and vice versa. So, if any of the child brands have negative publicity, it will affect all the brands along with the parent brand. This characteristic makes this architecture similar to a branded house. The individuality factor is what makes it similar to a house of brands.
For example, Kellog’s has many sub-brands, each with its identity yet still having the Kellog’s logo on the packaging.
Hybrid Brands
As the name indicates, a Hybrid Brand architecture is a combination of two or more brand architectures. This mostly happens when the parent brand wants to extend and create sub-brands that may or may not be affiliated. In this architecture, all metrics of the relationship can exist.
For Example, Volkswagen has other child brands such as Seat, Bugatti, Audi, and Skoda, all having their reputation and individual identity but still closely associated with the parent brand. This just shows that both the master brand and sub-brands can be well-reputed brands with their own brand identities. So, the master brand may or may not be closely connected to the sub-brands, depending upon the context.
Conclusion
Brand Architecture is important to the identity of any organization with multiple sub-brands. It helps the company run effectively and efficiently and helps them manage their profits and losses effectively. You will also better communicate with your target audience and improve brand clarity to them. The type of Brand architecture you adopt must depend on the nature of the master brand and sub-brands. Promoting your brand by through a well-organized brand architecture is as important as soul to a body. So, start building your brand architecture and makes own brand identity.
