The desired outcome of a brand alliance is to increase each other brand’s equity. Some of the examples could be as follows: “Two companies pool their resources to co-brand, with the idea that the new product can enjoy a unique positioning or two manufacturer’s pool resources to develop a promotional campaign featuring both brands. ” (Samu, Krishnan & Smith, 1999, p. 57). In general, brand alliances carry along great benefits but at same time ome inevitable risk. Well-established alliance is a powerful tool that can help to promote, to specify, to enrich, and to increase the brand value.
Good example for increasing the brand value is brand alliance of PorscheDesign and Adidas, where PorscheDesign clearly raises the image of Adidas and on other hand PorscheDesign has more presence and can sell its products in many lucrative locations. (Adidas Annual report, 2009). Brand alliances are used at times of prosperity as well as in times when the brand suffers; they may serve as a driver for a brand to regain its market position. Wrong arketing strategies can ruin the attractiveness and image of a brand and successful brand alliance can revitalize them.
According to (Samu et al. , 1999, p. 57) “A new brand might partner with an established brand to build a stronger presence for a specific usage occasion”. If one of the brands has very good image and brand equity, it is likely that customers will perceive the partner brand with similar attitude. This strategy is risky and can harm the stronger company. The risk factor can be lowered by extensive market analysis that can reveal some of the unfavourable issues for the xact brand alliance. A common practice for possible alliance partners is creation of an exit strategy.
That allows companies react quickly if some of the planned outcomes goes wrong or in other direction than planned. (Melvin Prince & Mark Davies, 2002) Very common reason for creation of brand alliance is a launch of a new product. It serves as a great advertising tool because it drags attention. New product is associated with some extraordinary brand, which creates a message for consumers. A successful example of brand alliances to promote new product launch where two trong brands allied and which worked perfectly was Range Rover and Victoria Beckham.
The outcome was the new model line of Range Rover, Evoque. Targeted mainly at female customers, sales growth rose significantly after the introduction of Victoria Beckham’s special luxury edition. Even though the actual limited edition was produced only in small volumes, it created great deal of exclusivity for the new product. Associating the new model with Victoria Backham and creating a well- managed advertising campaign led to a successful launch of the new model line crowned by many design awards. About Land Rover, 2012). . Analysis of Successful Factors in Brand Alliance 3. 1 Successful Factors Before going deeply in the analysis, it is important to understand in theory the successful factors behind a brand alliance and their effects on consumer attitudes. while the effects they produce are the independent variables. While engaging in an alliance, it is fundamental for companies to work on the successful factors in order to produce and maintain the positive effects while reducing the negative ones