Joint Branding Agreement

If a co-branding campaign is not conducted carefully and taking into account the main trademark license conditions, it can harm one or more of the parties involved. The potential negative results are as follows: the co-branding agreement must also include mutual compensation and liability insurance, since each party in the structure uses the other party`s trademark. For example, if a new product contains two components of two companies and one of them is defective, the other party can also be sued according to certain cases and legal laws, since both parties manufacture the product jointly. In essence, “co-branding” is a legal and marketing instrument that uses the cross-concession of brands from different companies to brand a new product, arouse consumer interest and increase turnover. Therefore, the customer uses the constituent information of the brand if no new brand is constituted by co-branding. If there is a negative image caused by one of the constituent marks, this also affects the other constituent mark. Brand value can be compromised by combining with a brand that might have a negative image in the future. The brand association is developed over the years through repeated experiences and exposures. It helps customers collect information, differentiate it, and make a purchase decision.

Co-branding can either improve or destroy the customer`s perception of individual brands and create a new perception of co-branding. [21] Studies indicate that the non-resemblance between co-branding organizations (company size, company home country, industry size) has a negative impact on the performance of co-branding organizations. [22] Brand partnership or co-branding is a popular marketing technique that translates a brand`s success onto partner brands. In the case of co-branding, a partner offers their branded product in combination with another company`s branded product, for example. B in a fast food restaurant offering a branded toy for a meal…