For business owners who own or are looking to acquire multiple brands, a brand architecture strategy is an absolute must-have.
Without it, they will struggle to develop a strong brand identity that will keep their revenue flowing through their assets, both old and new. They will also face the risk of wasting thousands, if not hundreds of thousands of dollars on ineffective marketing campaigns that lack focus and direction.
Choosing the right brand architecture strategy can be a tough decision, as there are numerous types of strategies. But knowing the key elements to look for will help you decide which architecture aligns with your brand goals.
In this post, I’ll take a deep dive into the key elements in brand architecture strategy. This is critical information that will help you make a better decision about how to structure and implement your brand architecture going forward.
But first, let’s refresh your memory on the basics.
What Is Brand Architecture?
Put simply, brand architecture is the way that companies, including well-known large corporations, structure the brands that they own.
To help you visualize this structure, it’s important to know about the types of brands that make up the architecture. Some are at the top, while others called “sub-brands” are at the bottom, but the key takeaway is that they all relate to each other in some way.
Starting with the brand types that make up the top of the architecture model, we have the master brand, the parent brand, and the umbrella brand.
Out of all your brands, the master is the one that is most recognizable to your customers. In most cases, it’s the name of the company, and its logo is featured on all the products and services that are offered by the sub-brands beneath it. For example, Apple is a master brand, and Apple TV is one of its sub-brands.
In terms of which type of brand is at the top of the architecture, the parent brand is it. The parent has many sub-brands beneath it, but these often don’t all fall into the same product or service category. For example, Procter & Gamble (P&G) owns several different types of brands, including Tide, Gillette, and Pampers.
The umbrella brand is a well-known brand or company that owns several sub-brands. These sub-brands all have different names, but they sell the same type of product. The Coca-Cola Company uses the umbrella style of brand architecture because it oversees a wide range of beverage sub-brands, like Coca-Cola, Sprite, Dasani, and Barqs.
Now that you know the main types of brands that make up a brand architecture, it’s time to learn about the architecture itself.
What Are The Types Of Brand Architecture Strategy?
There are four strategies that corporations use to construct an architecture for their various brands: branded house, endorsed brands, house of brands, and hybrid.
The branded house architecture puts the master brand at the top of the structure and sub-brands that share its name beneath it. All the brands in the architecture feature the same brand identity – hence the name, branded house. Apple is a great example of this style.
In an endorsed brand’s architecture, the parent or umbrella brand endorses sub-brands within their company to lend them legitimacy. These sub-brands are completely separate and independent from one another. You’ll often see this structure in hotel companies, like Marriott.
House Of Brands
A house of brand architecture is composed of several different brands that are independent of one another in terms of the customers they serve, the products they sell, and their brand identity. Yet they are all owned by a parent company. P&G uses this structure.
A hybrid architecture is one that leverages two or more of the above types within the same company. Amazon is a great example of a hybrid structure, as they use the branded house strategy as well as the endorsement style.
What Are The Benefits Of Having A Brand Architecture Strategy?
Companies of all sizes, from small to midsize enterprises to large corporations, reap benefits from having a brand architecture strategy. Here are 5 of those benefits.
1. Helps Companies Develop A Strong Brand Identity
Having a brand architecture strategy in place will help you develop a strong brand identity across your company. In some cases, you may need several identities. For example, in a house of brand architecture, you’ll own several different brands that are completely unrelated and unconnected. As such, you’ll need an identity for each brand that reflects its unique value, audience, services, etc.
2. Establishes Corporate Structure And Hierarchy
With an overarching architecture strategy guiding your company, you’ll have a map for establishing your corporate structure and hierarchy. You’ll be able to visualize how your sub-brands should interact with each other (or if they shouldn’t), which brands are the most important, and how your overarching brand identity (if you have one) trickles down to all the rest. The result will be a more organized, unified company.
3. Helps Shift Customer Perception The Way You Want
If you’re looking to shift customer perception in a certain direction – to promote a new product or service, or to highlight your company values – you can do so with a brand architecture strategy. For example, if you’ve developed a popular parent brand, you can use the endorsement architecture and put the name of the parent brand on a new product or service you’re trying to sell. This will increase interest in the new sub-brand among your existing customer base.
4. Helps Companies Expand And Scale Successfully
I emphasized early on in this post that companies who want to expand and scale their brands should prioritize developing a solid brand architecture strategy. The strategy will guide how, where, and when they should scale, and how their expansions will integrate into the architecture. Companies that use it will ultimately be more successful at achieving their goal to grow in size, output, and variety of brands.
5. Helps Eliminate Wasteful Spending On Scaling And Marketing
The last but by no means least benefit of brand architecture strategies that I want to discuss is how they help companies eliminate wasteful spending. Without an established strategy for organizing, marketing, and selling your brands, you can easily end up spending thousands, or even hundreds of thousands of dollars on pointless, unfocused marketing campaigns. You can also waste the time and energy of your employees and swallow up valuable resources.
The reason? You have no overarching brand architecture strategy, so you’re basically throwing everything you have against the wall to achieve your business goals with no real direction or focus. Put that strategy in place, though, and you’ll soon eliminate those pockets of waste.
What Are The Key Elements Of A Brand Architecture Strategy?
When deciding which brand architecture strategy to implement in your company, it helps to know the key elements that are universal across the board.
The first key element of a brand architecture strategy is a hierarchy. Each strategy model we laid out earlier in the article has one.
For example, in a branded house, the master brand is at the top of the hierarchy, while its sub-brands – with the master name attached – are at the bottom. In a hybrid architecture, a parent brand may be at the top of the hierarchy, followed by two or three master brands which in turn oversee their own sub-brands.
The higher up in the hierarchy a brand is, the more important it is to the company. However, this importance can manifest itself in different ways.
For example, returning to the branded house model, you’ll want your master brand name to be associated with all your sub-brands. In this structure, the highest brand in the architecture – the master – has a direct relationship with all the entities in the structure beneath it, as well as all the customers who interface with them.
If, however, you’re using a house of brand architecture, then you’ll most likely have a parent brand at the top of your hierarchy that is not necessarily associated with any of its sub-brands by name. Instead, these sub-brands function as independent entities. The customers who interface with them may not even realize they are owned by the same parent brand.
This is why examining the hierarchy of each brand architecture strategy is crucial to finding the one that best fits your company. The hierarchy will help you structure each of your brands in terms of their importance to your brand identity, your customers, and your overall business model.
Brand Identity (Or Identities)
Brand identity is not just important to your brand architecture strategy, but to your entire company, as well. Every aspect of marketing, from generating brand awareness to establishing loyalty among your customers, depends on it. Sales and customer support are also responsible for upholding the messaging, values, and graphics that make up your brand identity.
Your brand architecture strategy is extremely helpful for helping you achieve your desired brand identity. Take Apple, for instance. Apple is famous for its beautiful, innovative tech, but also for its clean, streamlined branding. They apply it to all their sub-brands, including Apple TV, Apple Music, Macintosh, iPhone, etc., so that even if a customer only sees one of their ads or products, they know exactly who’s behind it.
Even if you choose to implement a house of brands or hybrid brand structure, rather than a branded house like Apple, you can still use the architecture strategy as a guide to developing your brand identity. In such cases, where you own several different brands, referring to your strategy will ensure that you maintain your parent company values while designing a unique visual aesthetic for each sub-brand.
Always let your goals for your brand identity (or identities) be a deciding factor in your search for the best brand architecture strategy for your company.
Finally, the third most important key element of any brand architecture strategy is its growth potential. This, of course, is tied to the growth potential of your own company.
To determine the type of growth potential you need, you must define your long-term goals. Consider what you want your company to look like one year, five years, and ten years down the road.
Do you want to branch out into other types of products and services and reach completely new audiences with each sub-brand? Or do you want to establish sub-brands that all occupy the same market, and that is all tied back to a master brand? Or perhaps you’re looking for a combination of the above.
Once you’ve determined where and how you want to grow, you can find the brand architecture strategy that aligns with these long-term goals. That way, you already have a built-in plan for success, a roadmap to the future you desire.
I’ve just identified 3 key elements of brand architecture strategies – hierarchy, brand identity, and growth potential – that will help you choose the most optimal structure for your company. With a proper brand architecture strategy in place, you’ll experience incredible benefits like stronger brand identity, greater success while scaling, and cost savings on branding expenditures.
I am often criticized for my policy of non-zero set-up/licensing fees. I am asked: why not? Our competition is charging zero set-up fees? Why not us?
I want to quote to them the bulls-eye story, and I begin to, too, then I hold back. The legacy of wanting and taking things for free – hocking up a competitor in your face, and the fear of losing your prospect to someone less capable – has come full circle for my sales and marketing peers.
What I am offering, and of what value it is or can be to the prospect, is often ignored.
What Sales usually forgets and don’t address deliberately is the “generation part” – and that is something that needs to be equally addressed: the nurturing part – and this is specifically for long and complex sales. I personally believe that a good client may take even a year to sign up, eventually; though this is all supposedly left to “marketing” as if sales in the online niche is like a car sale in a car distribution outlet.
With branding, as in marketing, the bulls-eye story is the way I would go, with the theme: I have clients in order to build than building in order to get clients.