Strong brand architecture is one of the most important strategies for companies managing more than one brand. With brand relationships, name awareness, and customer trust often riding on how brands are presented, the brand architecture allows businesses to showcase the strength of their entire collection of brands in a way that benefits them collectively and individually. There are a variety of ways to organize brands, and choosing the right brand architecture for your company can depend on the company’s size, annual revenue, and even the types of brands in question.
This article will explain brand architecture in greater detail, including the various types of brand architecture. It will also cover the steps to creating your brand architecture and highlight the practical benefits of doing so.
What is brand architecture?
Brand architecture refers to the process used by brand strategists to strategically organize the sub-brands associated with a parent brand. Sub-brands are the small divisions of the master brand that can be whole companies or individual products or services. Brand architecture refers to the relationship of the sub-brands to the master brand as well as to one another.
The easiest way to think of brand architecture is a chart of the different brands within a given master brand. Much like an organizational chart shows a company’s hierarchy of executives, the brand structure shows the same kind of relationships between all the subdivisions of a parent company.
Brand architecture can influence customer behavior, present the depth of your brand portfolio, and play a role in how consumers view your company’s products. This makes brand architecture a key component in establishing brand equity, and nothing is more essential for the success of any single brand.
Brand positioning within the parent company is visible in its brand architecture, as is the relationship of each brand to the overall messaging and brand identity.
Types of brand architecture
Brand architecture can be set up in a variety of ways, depending on the needs and goals of the parent company. Which brand strategy a company decides to use, though, can depend on several factors (e.g., budget, expansion model, target audience).
The following sections offer insight into the four most common types of brand architecture and the types of companies they may suit best. You can also find examples of existing brands that successfully utilize them.
Branded house
The branded house model emphasizes the parent brand, with sub-brands taking a subordinate role. The major benefit of this type of brand architecture strategy is that it allows for a consistent customer experience and builds brand equity for the corporate brand.
FedEx is a great example of a large corporate brand that follows the branded house model. All of FedEx’s brand extensions bear the FedEx name and offer different solutions within the master brand. Apple and Virgin are two other significant parent companies that utilize the branded house structure. The branded house model is an excellent structure for larger parent companies looking to maximize their brand value by leveraging smaller, more focused services and products within their portfolio.
House of brands
The inversion of the branded house model is the house of brands approach. With this brand architecture type, the parent company isn’t apparent in any discernible way within the smaller, individual brands. Generally speaking, the master brand is somewhat hidden from the public’s view in a house of brands model, with one or more of the sub-brands taking center stage when it comes to the brand promise and messaging.
The house of brands model is often adopted by holding companies that have purchased subsidiaries. Procter & Gamble is a well-known example of the house of brands style, as are Unilever and Nestle. With so many product brands under its control, it wouldn’t make sense for a huge company like Procter & Gamble to change the name or packaging of an existing brand every time mergers take place. Such changes can be confusing for long-time customers and cause potential losses in both brand equity and revenue.
Hybrid brands
In a hybrid brand model, the dominance of the parent brand is shared throughout one or more of the sub-brands. One of the most well-known examples of this brand structure is Coca-Cola. Coca-Cola’s name appears on products like Coke, Diet Coke, and Coke Zero. However, other subdivisions within the brand portfolio don’t feature the name anywhere but in the fine print, such as with Dasani, Sprite, and Fanta. Hybrid brand architecture is also utilized by Microsoft, Marriott Bonvoy, and Alphabet, the parent company of Google
The major benefit of a hybrid model is that it allows for a great deal of flexibility when sub-brands can enjoy a bit more autonomy within their distinct verticals. A hybrid brand strategy can be quick and effective for companies that plan to partake in multiple mergers and acquisitions or wish to allow space for different levels of market-facing brands to keep their own brand identities.
Endorsed brands
In an endorsed brand architecture model, the parent brand functions like an older, more recognized sibling to the sub-brands. Because the master brand is well-established and already trusted by consumers, the other companies with the brand portfolio can have their brand presence within the market while still enjoying the benefit of their endorsement from the parent company.
The endorsed brand style allows for companies to piggyback off one another’s influence and share the mutual benefits of their associations with one another. If you have ever seen messaging like “Brought to you by …,” this is an example of the endorsed brand strategy.
The endorsed brand style might best be exemplified by Marriott. While the company’s sub-brands have their presence, they’re all endorsed by Marriott (with the name sometimes even appearing in the logo) so customers can feel confident they’re getting a similar experience.
Companies looking for the most brand positioning alternatives and the least amount of risk to brand equity may wish to opt for an endorsed brand model.
Practical benefits of brand architecture
Organizing your company’s brand comes with a world of positives beyond the helpfulness of implementing a recognizable structure. Efficiency, brand equity, customer awareness, and brand positioning are all impacted by brand architecture models. The following sections explain four advantages of having a clear and solid brand structure.
Customer awareness for all products/services available
When individual brands belonging to a parent company are delineated, their strengths are more visible to the consumer market. Without having to rely on the master brand for market recognition, a single brand within a company’s portfolio can maximize customer awareness of all the other brands within that portfolio. For example, a customer who may never have heard of one sub-brand may become loyal to another and, when in need of other products and services, go looking within the same brand portfolio because trust has already been established with that parent company.
Fulfill the needs of your target audience
Being able to focus on the specific needs of your target audience allows your brand to fulfill that audience’s needs in a more precise way. For example, if an established brand’s new products are aimed at teenagers, being able to package and message those products in a way that appeals to that age bracket promotes brand awareness. It also widens the chances that the target audience will receive the product in a way that best serves the overall goals of the parent company for the sub-brand.
Clarity of brand position
Nothing is more important to any type of brand than clarity of position in the marketplace. Stakeholders need to know who you are and what your company is about. The brand architecture allows you to highlight and underscore your brand’s placement against competitors and its relationship to other brands in your company’s retinue. From this comes heightened efficacy in gaining customer understanding and brand buy-in.
Protection of brand equity
Any dilution of brand equity can be prevented with the placement of the right brand architecture strategy. Because it aids growth in marketplace valuation and promotes industry authority, brand architecture goes a long way toward ensuring your company’s brand equity. Immediate returns associated with the protection of brand equity include expanding trust in the master brand or parent company and heightening the visibility of the brand promise.
How to create your brand architecture
Brand architecture should be designed in a way that benefits both the company and the customers (both established and potential). If you’re just starting to think about which type of brand structure you need, the first piece of wisdom is to keep it simple.
Keep in mind that successful brand architecture lays out your company’s message with more clarity, not less. The following sections offer four steps toward building a brand management plan that works for your company.
Step 1: Carry out customer and competitor research
Your first step in building brand architecture is to research what your customers already know and understand about your brand. What are their current levels of brand awareness and loyalty? How clear are they on your brand’s messaging? The answers to these questions will highlight what your customers need to understand about your company’s offerings.
As any company’s goal is to connect with the audience that its products serve, research data to help you see which type of brand architecture will be best for your business. You can go about doing this through qualitative interactions with stakeholders. One-on-one interviews with both internal and external stakeholders can be extremely helpful for getting insight into where your company’s messaging needs to be tweaked.
You can also carry out quantitative studies that involve tools like online surveys and design brand equity tests that let you see where every single brand stands about the others in your brand portfolio and the overall market.
Step 2: Choose your brand architecture type
Choosing your brand architecture type relies largely on how much or how little you wish to feature your parent brand. Do you want your sub-brands to bear the name of the parent company or be associated only in the fine print? Have you recently undergone a merger or acquisition where a former competitor’s brand is now housed under your company’s control? Do you plan to leverage the verticals of every single brand in your portfolio as a separate entity or would it be more beneficial for the parent company to retain the lion’s share of the brand awareness? These are all questions to ask as you make decisions about which type of brand architecture best serves your company’s needs.
A simple way to go about evaluating brand architectures is to make pro/con lists for each structure type. With clarity as a priority, think about how much cross-promotion of products and services would best prop up the synergy between your sub-brands. While charting these choices, don’t forget to think about money and manpower. It doesn’t do your company any good to design brand architecture without the budget or resources to sustain it in the long run.
Step 3: Build your strategy
Successfully building a brand strategy is all about determining what’s best for your master brand and its sub-brands. Once you’ve decided on the appropriate brand architecture for your business, create an actual blueprint of that structure. This “map” of your brand portfolio should emphasize the public and private connections between your extensions. Likewise, it should include all visual and verbal indicators that will appear to customers who invest in any of your brands.
For example, if your parent company houses three separate brands of shoes that will all bear the insignia of the parent company somewhere on the product, this needs to be explained in your brand architecture blueprint. Include each brand’s scope, strategic role, and relationship to the master brand in your design and decision trees for future mergers and acquisitions where possible.
Step 4: Align your content to the structure
Some companies may face challenges when implementing a new brand structure. Making sure that your existing brand identities fit into the new brand architecture you choose is vital for older companies looking to rebrand. By contrast, new companies that are creating products or services for the first time have a bit more leeway.
Larger companies with a host of smaller brands to manage may find it costlier to repackage and reorganize those sub-brands in any significant way, while newer companies can alter their digital presence and signage with greater ease. Ultimately, companies should choose a brand architecture that represents the smallest amount of disruption to their current brand equity and the greatest emphasis on the strengths associated with each of its sub-brands.
Next steps
Hiring a brand consultant is especially important for companies introducing new brands to a busy market. Getting your brand name out there with the right messaging is easy when you have the insights and marketing strategies of a trusted brand professional at your service.
If you’re eager to hire the best brand marketers, look no further than Upwork’s global pool of independent brand strategists. Let Upwork help your company start building a strong brand today with one of our brand management experts.
