In today’s crowded and competitive market, companies are always looking for ways to differentiate themselves and stand out from the competition. One strategy that has proven effective for many companies is the use of sub-brands.

But what exactly is a sub-brand, and how can it benefit a company?

A sub-brand is essentially a brand within a brand. It’s a subsidiary of the main brand, but it has its own unique identity and positioning in the market. Some examples of well-known sub-brands include:

• Toyota’s Lexus brand for luxury vehicles
• Nike’s Jordan brand for athletic shoes and apparel
• Coca-Cola’s Dasani brand for bottled water
• LG’s VELVET brand for its newest smartphones

Why do companies create sub-brands? 

There are several reasons a business may choose to develop a subsidiary brand. Here are a few reasons:

• To give consumers more choice and allow them to select a product or service that aligns with their specific needs or preferences
• To protect the main brand from negative associations
• To test new markets or target new segments without risking the reputation of the main brand
• To create a more cohesive brand strategy and differentiate products or services within the overall brand portfolio
• To appeal to specific demographics or geographic regions
• One of the main benefits of creating a sub-brand is the ability to reach a specific segment of the target audience. For example, if a company has a diverse range of products or services, it might create a sub-brand for its high-end offerings in order to appeal to a more affluent demographic. This allows the company to better target its marketing efforts and increase its chances of success.

Another benefit of sub-brands is the ability to differentiate products or services within the overall brand portfolio. This can be particularly useful for companies that have a wide range of offerings, as it allows them to better organize and position their products or services in the market.

Sub-brands can also be used to protect the main brand from negative associations. For example, if a company has a product that is controversial or polarizing, it might choose to create a separate sub-brand for that product in order to insulate the main brand from any potential backlash. This can be especially important in today’s digital age, where negative reviews or criticism can spread quickly and potentially damage a brand’s reputation.

In addition to these benefits, sub-brands can also be used to test new markets or target new segments without risking the reputation of the main brand. This can be a useful strategy for companies looking to expand into new geographic regions or demographic groups. If the sub-brand is successful, the company can then consider rolling it out under the main brand.

It’s important to note that while sub-brands can be a powerful tool for companies, they also come with their own set of challenges. One challenge is maintaining a consistent brand identity across all sub-brands, while still allowing each sub-brand to have its own distinct personality. It’s also important for companies to ensure that their sub-brands are aligned with the overall brand strategy and values, in order to avoid confusion or inconsistency among consumers.

Sub-brands are a useful way for companies to appeal to specific segments of their target audience, differentiate their products or services, and test new markets. While they can be beneficial, it’s important for companies to carefully consider the pros and cons of creating a sub-brand and to ensure that they are aligned with the overall brand strategy and values. 

The pros and cons of sub-branding

There are both pros and cons to using a sub-brand as part of a company’s branding strategy. Some of the main pros include:

• Ability to appeal to specific segments of the target audience: Sub-brands allow companies to create specific identities and messages that are tailored to different demographics or interests.
• Ability to differentiate products or services within the overall brand portfolio: Sub-brands can be used to clearly distinguish different product lines or services, making it easier for consumers to understand and choose the right product for their needs.
• Ability to protect the main brand from negative associations: If a company has a product or service that might be controversial or polarizing, it can create a separate sub-brand to insulate the main brand from any potential backlash.
• Ability to test new markets or target new segments without risking the reputation of the main brand: Sub-brands can be used to test out new markets or target new segments without risking the reputation of the main brand. If the sub-brand is successful, the company can then consider rolling it out under the main brand.

However, there are also some potential cons to using a sub-brand:

• Maintaining a consistent brand identity across all sub-brands: It can be challenging to maintain a consistent brand identity across all sub-brands, while still allowing each sub-brand to have its own distinct personality.
• Aligning the sub-brand with the overall brand strategy and values: It’s important for the sub-brand to be closely aligned with the main brand in terms of values and overall brand strategy, in order to avoid confusion or inconsistency among consumers.
• Additional time, effort, and resources required: Creating and maintaining a sub-brand requires additional time, effort, and resources, which can be a significant investment for a company.
• Potential for brand dilution: If a company has too many sub-brands, it can dilute the overall brand and make it harder for consumers to understand and remember the brand.

Should your business create a sub-brand?

There are several key questions that a business should ask when considering whether to create a sub-brand:

• What is the purpose of the sub-brand? Is it being created to appeal to a specific segment of the target audience, differentiate products or services within the brand portfolio, or protect the main brand from negative associations?
• Is the main brand strong enough to support a sub-brand? A sub-brand should be able to stand on its own and have its own unique identity, but it should also be closely aligned with the main brand in terms of values and overall brand strategy.
• Will the sub-brand be able to differentiate itself from the main brand and other competitors in the market? It’s important for the sub-brand to have a clear and distinct positioning in the market in order to be successful.
• Does the company have the resources to support a sub-brand? Creating and maintaining a sub-brand requires additional time, effort, and resources, so the company should be prepared to invest in the sub-brand in order for it to be successful.
• How will the sub-brand be integrated into the overall brand strategy? It’s important for the sub-brand to be aligned with the main brand and for there to be a clear and consistent message across all brand touchpoints.

If you’re considering creating a sub-brand for your business and need help with the branding and identity process, we would be delighted to support you. Our team will work with you to understand your business goals and target audience and develop a unique and effective sub-brand identity that will help you stand out in the market. We can’t wait to work with you and help you succeed!