Family branding refers to the marketing strategy where a company uses it’s main brand on other merchandise belonging to the same or other product categories.
The purpose of such branding strategy is to give new products lines more perceived recognition and credibility as the main company brand is well-known by consumers.
If a company name or logo has great brand equity it make economic sense to ride on the goodwill that it commands as a platform to launch new products.
Not only would it save marketing expenses, but can even be greeted with huge demand on launch.
As family branding is usually associated with diverse product lines using the same brand, it goes without saying that companies that practice it tend to have a generic brand name.
For example, General Electric has built such a powerful brand name associated with quality and good value over the last decades that they launched several other products in very different industries under the GE brand.
To put it into perspective, GE started with electrical products. And is now doing business in finance, energy, and even software, etc.
All these products come under the GE umbrella, which is family branding in play.
With a powerful, proven brand with a good track record behind new products, new products can save millions of dollars in marketing budgets to get into the minds of consumers.
In some ways, it provides instant credibility to new products that consumers have never seen before.
For example, even though Apple is undoubtedly associated with the consumer electronics space, when it made it’s way into the music industry, consumers had no problems flocking to the Apple music store to purchase and download music.
This could be a totally different story if the new music store does not have a proven brand behind it as people might worry that they are illegally downloading pirated music.
Having said that, family branding might not always be the best move for companies.
Factors to consider
When a particular brand is too strongly attached to a particular product, it can be very difficult change mindsets and induce consumers to adopt it for other categories of products.
For example, it would indeed be odd if a brand like Pizza Hut goes into the business of real estate and name a condominium development as Pizza Hut link.
This goes back to the point mentioned earlier that family branding is most appropriate for generic brand names.
When companies decide to develop and sell new products to new markets, then using a sub brand under a parent brand can be a more effective way to avoid confused consumers.
For example, Amazon using the label AmazonBasics to market their in-house products.
Otherwise, creating a totally different brand might be necessary to achieve a company’s branding goals.
One good example is Toyota being synonymous with low priced cars providing exceptionally good value for money. So when they decided to jump into the luxury car market, they conceptualize the Lexus brand instead of using a family branding strategy.
