The expansion of any business requires a careful approach and detailed organization. And as you work toward developing your moving company and expanding its brand, you also must make sure to create a functional operational structure. There are many examples of brands that experienced rapid growth, only to stop there, ending up acquired and absorbed by larger corporations and conglomerates. To ensure that your company doesn’t meet the same fate, you need to understand how to organize its structure. Today, we explore the very notion of brand architecture, its importance, and how to choose the best type for your moving business.
What is brand architecture?
- Brand architecture is a method used for organizing various subsections (sub-brands) of a larger brand. It is a layout that explains how one brand branches out into a sub-brand structure (and how they relate to one another).
The importance of creating this type of system applies to larger brands, helping them expand in a structured manner. It helps marketers as well as company higher-ups get a clear image of how their brand is organized. And it also creates a foundation to boost brand awareness for each part of the brand as well as holistically. There are three different types of brand architecture that a business can consider opting for:
- Branded House
- House of Brands
- The Endorsed Brand
Each of these come with their pros and cons that you will want to consider. Let’s take a closer look at each one:
The Branded House
The branded house approach is your typical example of a family tree.
- You have the parent brand which carries the name, such as Google.
- Then you have the sub-brands that share the parent brand name + their own extension (Google Maps, Google Translate, Google Books, Google Drive, Google Mail, etc.)
All of the sub-brands are subordinate to the parent brand, sharing its name and adding their own functionally to it. This type of brand architecture is common for corporations that want to minimize confusion, build equity, and maintain consistency in their brand awareness.
The House of Brands
The house of brands presents the complete opposite structure from that of a branded house. There is still a parent brand and sub-brands, but they do not share the brand name. In most cases, parent brands allow sub-brands to keep their brand name which overshadows the small-printed parent brand name. In other scenarios, we have holding companies that buy up subsidiaries and maintain ownership while leaving the brand intact.
A typical example of this would be the Volkswagen Group, which has ownership of other car brands such as Audi, Lamborghini, Bugatti, Bentley, Porsche, SEAT, etc. All these car brands are well-known across the globe, and for their buyers, the parent brand is irrelevant compared to the actual cars that they are buying. Changing the names of such well-established brands would only cause unwanted confusion and potential loss of business. This way, Volkswagen retains the brand equity of all its subsidiaries.
Of course, we should also mention that there are hybrid brand architecture systems, where you might have a some sub-brands that share the parent brand name while others do not (Coca-Cola being the example here).
The Endorsed Brand
This type of brand architecture is what one might call the middle ground between the other two. You have a parent brand that does form a protective dome over the sub-brands, but those brands are not required to share the parent brand name. However, the parent brand still has a role to play beyond the simple notion of ownership.
Microsoft is your example of a hybrid endorsed brand, where you have sub-brands such as Windows and Office that share the name and sub-brands like Skype, Bing, and Xbox which do not. The endorsed brand structure offers flexibility and efficiency in choosing whether or not to boost sub-brands with the parent brand name. On the other hand, it doesn’t prioritize customer segmentation.
How to choose the right one?
Consider the long-term scenario where your company has come to a point where it has acquired other companies throughout the years and has now become a parent organization for all of them. That puts your brand in a unique position to spread its influence further through brand architecture. However, in order to do so, you need to understand the customers for each of those brands, as well as their operational and marketing processes. There are a plethora of different ways to advertise your business, and each company has its own unique strategy that it follows. Stepping in as a parent brand and making drastic changes can upset the delicate balance that the company has spent years building.
There are plenty of factors that a brand needs to consider before opting for any of these three types:
- Current architecture
- Marketing goals and objectives
- Current products/services
- New products in the pipeline
Of course, another important factor that plays a role here is the customer base. Shifting to a different brand architecture takes time and resources, and it can significantly influence the behavior of consumers. Therefore, much like any marketing strategy, businesses need to take careful steps to maintain the effectiveness of the brand.
Benefits of maintaining a consistent brand architecture
The acquisition of other companies can be a complex and difficult process. And no matter how accommodating the parent brand is toward the child brands it buys out, there is always an initial tension between the two. Whether you decide to change the name of the domain, add your own brand name to the acquired one, or simply take over the entire managing team and replace them with your own, the transition can prove difficult. However, despite the initial struggle, all parties need to understand the benefits of creating a brand architecture and presenting a unified brand:
#1: Unified strength in the marketplace
A consistent visual and verbal identity that matches your parent brand with its sub-brands clarifies the strength of each brand on the market. The clarity serves to emphasize the connection companies have with existing customers while instilling confidence in its staff, the board of directors, CEOs, and shareholders.
#2: Ever brand deserves a good story to support it
We recently wrote an article on the subject of creating your brand story – how to do it and why you need to. Modern consumers tend to have a skeptical view of large corporations that simply acquire new assets and “convert” them. That is why all globally-known brands consolidate their brand and sub-brands with strong and compelling background stories. You need to find a common cause that will be able to unite your brand architecture in the eyes of others. And it won’t be an easy process – it will require careful research, strategizing and creativity.
#3: Revenue growth through cross-sales funnels
Once you find a common foundation for your entire brand structure, it will be all the easier to cross-promote the different products that your parent brand and sub-brands offer. By presenting them as products/services that complement each other, you will gain that shared value for each that will boost the impact they have on target audiences.
#4: Strengthens the inclusive culture of your brand
A compelling unified story can serve as a rallying cry for all your employees, one that makes everyone in various business units and locations feel like they’re all fighting for the same cause. That’s why it’s important to plan the internal launch when you’re working on a new brand: to create an authentic buzz before the external launch.
How best to prepare for brand consolidation
Consolidating brands isn’t something that can be done overnight. It requires a holistic and systematic approach, one supported with research, strategy, and detailed planning. This can involve:
- Customer/prospect interviews to tell you what they value and how they view the market and your company
- A discovery session and internal interviews to discern what executives, subject matter experts, or other key stakeholders think you should be saying
- A communications audit to determine how you’re currently communicating to the marketplace
- Competitor research to understand the brand structure of your competitors and how they’re communicating
- Creation of strategies for communications, as well as the internal and external brand launches
The case for hiring a neutral party
In many cases, a marketing agency can bring great value to a brand consolidation project. They can serve as an impartial observer who asks important questions and makes strategic recommendations without any office politics getting in the way. Also, your organization doesn’t go through a major branding project very often, while an agency that specializes in branding does numerous such projects each year, so they can bring a great deal of relevant experience.