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An umbrella brand is where a group of products possesses the same brand name. Different products having different images are put together under one major brand or parent brand and are marketed by the firm. Umbrella branding does not mean that the whole product portfolio of a firm will fall under one brand name as company can go for different approaches of branding for different product lines.
- Promotion is very cheap and easy for products falling under umbrella branding. This strategy is generally implemented by firms coming up with a new product.
- For all the different products and services, advertising, promotion and Integrated Marketing Communications tools can be combined.
- Also, launching of a new product under umbrella gains recognition easily as it is introduced in the market which has already accepted the brand image.
- If any one product under umbrella branding does not do well in the market then it can affect the overall brand
- Different brands in umbrella branding will have different qualities which will vary and thus it can be an obstacle for smooth functioning of brand as well as firm.
- Also, if there is negative publicity for any product or even new product it can affect the other brands under umbrella branding.
- It is easy to identify the new brand in the company under umbrella branding by the customers.
- It gives uniformity to all the brands falling under it may be through one designated approach of advertising, promotion, packing etc.
- It is a very economical strategy to be implemented.
- It is probably the best way to enter into new segments or introduce a new product to market.
- It will be very profitable for firms which are having different quality of brands and different images of brands if followed properly.
- It is the branding strategy that gives the probability of a brand extension for every possible quality of profile.
Umbrella branding generates savings in brand development and marketing costs over time and can create advertising efficiencies. Consumer’s experience in one category may affect their quality perception of another product or service falling under same umbrella brand.
Some factors which may influence the impact of umbrella branding are:
- The degree of commonality among the products falling under umbrella brand for same usage by customers.
- Nature of branding policy applied by the firm as advertising and marketing different products under umbrella brand will be less informative but at the same time it will be less complex for target audience to understand.
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