In the ultra-competitive luxury environment, brands are continuously looking for new ways to grow in the marketplace whilst reducing expenditure on areas such as product launches. Image Credit: Adidas Why is co-branding so successful in the luxury industry? Apart, Bugatti and Hermès create incredible products but together, on this occasion, through co-branding, the end result was even more extraordinary. The name of the exclusive model nods to the main Hermès store on Paris’ Rue du Faubourg Saint-Honoré, and the product blends iconic Hermès styling with Bugatti’s world-class engineering. One of the best co-branding examples here is the Bugatti Veyron FBG Hermès supercar, created in 2008 through a brand partnership between supercar manufacturer Bugatti and luxury fashion house Hermès. With an understanding of what co-branding is, let us now look at the different types of brand partnerships frequently used in marketing strategies, which can be divided into two categories functional co-branding and symbolic co-branding.Ĭompanies that are looking to create a product or service that gives users an even more enhanced and improved experience through an association with another brand will seek out what is called functional co-branding. It is typically also the ‘initiating’ brand that takes responsibility for actually creating and producing the end product. The brand that initiates the partnership tends to seek out a collaboration with a brand that will bring added value to its operations. This unique partnership is only possible if the collaboration between the two brands (or more) results in the co-creation and co-signature of a product, conceived through a shared vision and common values. There is typically no domination from either brand, with each company in the partnership contributing a part of its own identity to create a ‘new’ fused product representing both parties. In very simple terms, it’s when two separate brands join forces to build something extra-special together.Īlso known as a brand partnership, co-branding is very much about sharing an experience and working side-by-side. What is co-branding and how does it work?Ĭo-branding is an alliance or association between two or more brands with the objective to create a unique product co-signed with their two names.