A house divided

February 12, 2016

by Lance Parman

The entrepreneurial dream is to find that new or untapped opportunity in the market and build a successful company to meet demand. As a business moves from infancy to adolescence, the brand evolves organically and at times reactively. Each stage of growth comes with unique challenges. When a regional company decides to build a national presence, it must thoughtfully choose a brand methodology that aligns with the business objectives for the next chapter.

The most common branding challenge growing organizations face is the struggle between consistent branding and diversification. Multiple brands often emerge as the company expands into new markets segments and service offerings. What might have been a logical evolution in the early years can result in a fragmented family of brands. It is essential to adopt a brand methodology that best aligns with where the company is going next.

Branded House

The “Branded House”—where the company is the brand, and all products and services within the company are subsets of the primary brand—is a good strategy for gaining market share and building name recognition quickly. A good example of this brand architecture is Apple. All categories/divisions fall under the standard of the Apple brand.

House of Brands

The “House of Brands” focuses on the branding of multiple sub-brands while the company’s brand gets little or no attention, as with a company like Proctor & Gamble. In this example, dozens of brands are marketing and supported independently, such as Tide, Pampers, Gillette, and Duracell. P&G receives very little attention and provides no real credibility to the individual brands. This structure requires more financial resources to support the marketing needs of each brand and can often result in conflict or competition between brands.

Determining which of these two methodologies is the right path for your organization requires a careful look at your market, target audience(s), product/service offering, and long-term business objectives. There are pros and cons to each strategy. The key is to carefully choose and consciously implement the brand strategy that is best for your organization. That is, you have to choose a path. Tactics that are not intentional—or worse, reactionary—can fragment your brand and erode its purpose year after year.

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