Brand architecture

What is brand architecture?
Brand architecture refers to the structured organization and hierarchy of a brand or brand portfolio, including the relationships between corporate, product and sub-brands. 

A brand architecture project clarifies, for example, the question of how many and which brands a company needs to successfully operate its business and reduce costs.

How many brands does a B2B company need?
B2B companies usually get by with just a few brands – ideally with one main brand and a few additional brands that cover exceptions. Examples include premium brands that distinguish discount offers with a separate brand, or acquired company brands that are initially managed separately from the main brand for risk reasons. Additional brands may also be required for legal or regulatory reasons.

Does every offering need its own brand?
Strong branding focuses on as few brands as possible. Especially in B2B, a single strong corporate brand is usually enough to communicate a wide range of offers. B2B offers are ideally designated with a self-explanatory offer nomenclature. This way, the company can use the trust in the well-known corporate brand to quickly bring new offers to market.

How many brands does a B2C company need?
B2C companies usually maintain a multi-brand portfolio with different strategies: global food companies often have well over 1000 product brands. The company’s expertise is often communicated with a reference in the trademark – a so-called corporate anchor. Luxury brands also maintain large brand portfolios, but the group remains in the background. In both scenarios, the reason for the numerous brands is a fine gradation of price ranges – and maximum visibility on retail shelves.

What are common mistakes in brand architecture?

• Lack of or unprofessional strategy for defining the brand architecture.
• Brand portfolio that is too large or brand architecture that is too complex: a brand portfolio that has grown over time or has been designed in a complicated way dilutes the attention of customers and weakens the overall perception of the company. In addition, a large brand portfolio requires considerable financial and human resources.
• Insufficient differentiation of brands within a brand portfolio – this leads to confusion and makes it more difficult to address stakeholders in a targeted manner.
• Choosing the wrong brand architecture, for example when a B2B company imitates a B2C brand strategy and tries to manage a very large brand portfolio. Due to limited resources in B2B, the individual brands are not sufficiently maintained and deteriorate, while the main brand is suppressed or even cannibalized by the other brands in the portfolio.
• Missed integration after the acquisition of attractive small to medium-sized technology brands by large corporations: the new technology is not attributed to the corporate brand, but to the acquisition. The corporate brand is standing still, while the stand-alone technology brand faces difficulties in scaling.