Build Your Brand Together

The Ingredient Branding Way

Understanding role of secondary associations in brand building.

Learning in brief about Co-Branding.

A special case under Co-Branding: Ingredient Branding.

Learning from case : Ingredient Branding The DuPont Way.

Indian Ingredient Branding examples.

Do’s & Don’t of Ingredient Branding in 21st century.

Summary.

Table Of Content – 7 items

Leveraging Secondary Brand Associations to build Brand equity

An effective way to build brand equity of your brand by linking it to other entities.These linkages help brand to borrow some brand equity from other entities.

Puerto Rico Rum makers leveraging their geographical roots to establish dominant market position.

Secondary Brand Association Sources

Brand Places

Countries of Origin

ChannelsThings

Events CausesThird-party

endorsements

People

Employees

Ensdorsers

Other Brands

ExtensionsAlliances

Ingredients Company

Important factors in predicting the extent of leverage

Awareness and Knowledge of identity.Question needs to be answered : What do consumers know about the other entity?

Meaningfulness of the knowledge of the entity. Question needs to be answered : Does the knowledge about other entity affect what customers think about the brand when it is linked with the other brand?

Transferability of the knowledge of the entity.Question needs to be answered : How strongly the knowledge of other brand will be linked by consumers to the brand?

Co-Branding

Cobranding is a marketing partnership between at least two different brands of goods or services. This strategy typically associates the brands of at least two companies with a specific good or service.

Advantages and Disadvantages of Co-Branding

Advantages• Borrow Needed Expertise• Leverage equity brand doesn’t have.• Reduce cost of Product Introduction.• Source of Additional Revenue

Disadvantages• Loss of Control• Risk of brand equity dilution• Negative feedback effects• Lack of brand focus and clarity• Organizational distraction

Successful Cobranding Partnerships

The French fashion house

Louis Vuitton has created a range of carbon fibre

luggage designed

specifically to fit BMW’s new i8

sports car.

The Bonne Bell a US based lip balm company created a lip

balm containing flavor of Dr.

Pepper’s brand.

Ingredient Branding

A special case of Co-Branding which creates brand equity for materials, components or parts that are necessarily contained within other branded products.

Producer decides communication policy of ingredients used in the product.

A symbolic relationship providing tangible benefits for both host and ingredient.

“Intel Inside” : The Ingredient’s Story

Intel owes it’s success to “Intel inside” Integrated Branding campaign.

“Intel Inside” campaign was launched in 1991 with 200 OEM’s.

“Intel Inside” taught consumers to look for Intel Inside logo in computers.

By 2007: 1000 OEM licensees. 80% consumers prefer Intel in PCs.

The ingredient brand must bring significant enhancement to the product.

Ideally, the ingredient brand should have high awareness.

Ingredient brand should have a strong performance attribute or feature.

Linking the ingredient brand to product should increase brand awareness.

Financial deal struck between two brands must be mutually beneficial.

The ingredient brand must be visibly featured on the product or it’s packaging.

Keys To successful Ingredient Branding Strategy

Ingredient Branding the DuPont Way

Case Analysis

• Founded in July 1802 by “Eluthere Irene Dupont de Nermours”.

• Headquartered in Delaware,US. Dupont started as a gun powder making mill.

• Product line of DuPont ranges from apparel to aerospace.

• Brands created by Dupont have been used as components in variety of products.

Should I go for Ingredient Branding

or not?

DuPont Brand Manager

Quantitative Analysis• Model estimate the return on promoting

the product as an ingredient brand. • Input provided are brand resource

allocations, in return model predicts favorability ratings and potential sales.

Qualitative Analysis

• DuPont assess through consumer and competition analyses that if ingredient branding will help in product’s positioning or not.

Ingredient Branding - Win-win strategy for DuPont

Higher Price Premiums (often as much as 20 percent)

Enhanced Brand loyalty

Increased Bargaining power with other members of value

chain.

Marketing The Stainmaster Brand

DuPont integrated Stain-resistant carpet fiber with tough brand like

Stainmaster

Result: Beyond Expectation75% sales in stain Resistant carpet segment belong to DuPont

P&G and Dupont turning corn leaves to clean washing

Watch this wonderful video on Ingredient branding

“Desi” Ingredient Marketing stories

Pani Puri waala based out of Mumbai creates brand awareness using Bisleri as an ingredient.

https://foursquare.com/v/bisleri-chaatwala/4f0d8d84e4b050cacf526b72

Established in 1946 Amul is considered as an epitome of quality when it comes to dairy products in India.

Local Restaurant and hotels use Amul’s brand to establish credibility of their food items.

Do’s & Dont’s of Ingredient Branding

Ingredient selection for the product is becoming complicated; earlier with limited competition and innovation ingredients which offered value were chosen but now the market presence of ingredient is also taken account.

Be careful whom you are dealing with; Ingredient Branding is a risky business where sometimes ingredient eats away the host brand e.g. DuPont built the Lycra, Kevlar, Teflon, and rayon ingredient brands and slowly these brands become more popular than the manufacturer brand which used them.

Not only the choice of ingredient brand but also the fact that how long one stick with ingredient brand; determines the course of host brand in future.

Summary

• If there is a secondary entity that already exists which has good brand image and brand awareness, we could somehow link our brand to their brand to transfer equity to our brand.

• If consumers have no awareness of the secondary entity, then they cannot transfer anything from it. Therefore it is important to carefully evaluate the secondary entity before linking to the brand.

• A special case of Co-Branding, Ingredient Branding offers a potential for successful brand awareness and increased profits for companies which mutually decides to come together, along with added value for the customer.

• One of the greatest successful stories in Ingredient Branding history is of "Intel". Intel Corporation demonstrated the marketing possibilities of Ingredient Branding for both component manufacturers, as well as the manufacturers of finished goods.

DISCLAIMER

This work is created By Nishant Hirani, IIM Lucknow, as a part of term end project for the

Brand Management course under the guidance of Prof. Sameer Mathur

https://in.linkedin.com/in/sameermathur