Brand Architecture: How To Organize Your Brands

Companies develop brand architectures to sell different products or offer different services that need to be in some way structured.

Brand architecture simply brings order to chaos.

Brand architecture refers to the hierarchy of brands within a single company.

At some point can come to the conclusion that what you do is not just one company.\

And that you offer different products or services and they need special attention.

So how do you organize your offerings, divisions or products?

That’s what we call brand architecture - the interrelationship of the parent company, subsidiary companies, products, and services within one organization.

What are the types of brand architecture?

We can distinguish three different ways to organize brands within a company.

Types of brand architectures:

1. Monolithic
2. Endorsed
3. Pluralistic
4. Hybrid

These are the three basic types and they each have different strengths and weaknesses.

Sometimes companies use a combination of the above — Alphabet is an example of a hybrid architecture.

So in this article I will describe each type of brand architecture and give you some examples so that you can get a sense of how to use them to structure your organization.

Remember to start with developing your brand strategy first, which will allow you to make more meaningful decisions when it comes to your brand architecture.

1. Monolithic Brand Architecture

Monolithic architecture (or branded house) is characterized by a strong, single master brand.

Brand extensions use the parent’s identity with descriptors.

Fedex is an example of a monolithic brand architecture.

In this type of brand architecture the master brand takes under control of the whole operation.

All brands bear the parent brand's name - it's always visible.

Benefits of using monolithic brand architecture:

• Customers make choices based on brand loyalty.
• Features and benefits matter less to consumers than the brand promise.

This type of branding is also known as an umbrella or a corporate brand.

In this model the parent brand and all sub-brands are clearly from one organization.

Famous brands that use monolithic brand architecture:

• Google — Google Maps, Google Ads, Google Pay
• GE — GE Healthcare, GE Energy, GE Aviation
• Virgin — Virgin Mobile, Virgin Records, Virgin Media

The risk of alienating customers that have already made up their mind about a specific brand

2. Endorsed Brand Architecture

Endorsed architecture is characterized by marketing synergy between the product or division, and the parent.

The product or division is endorsed by the parent company.

Apple is an example of an endorsed brand architecture.

This type of brand architecture simply contains independent brands which are endorsed by an organizational brand.

Benefits of using endorsed brand architecture:

• The endorsement adds credibility to the sub-brand.
• The new brand is linked to the positive equity from the existing brand.
• Allows to compete in the market without alienating the existing audience.

The difference to monolithic branding is that endorsed branding will use a parent brand that can sometimes be hidden.

However, in general, we all know the master brand but it

Famous brands that use endorsed brand architecture:

• Apple — iPay, iPad, iPhone
• Marriott — Courtyard, Fairfield, SpringHill
• Nestle — Nesquik, KitKat, Cheerios

The benefits are that the new brand is linked to the positive equity from the existing brand.

3. Pluralistic Brand Architecture

Pluralistic brand architecture (or house of brands) is characterized by a series of unrelated brands.

The name of the parent is invisible, new brands are developed.

This program doesn’t rely on the master brand at all, but instead each sub-brand gets its own image.

Procter & Gamble is an example of pluralistic brand architecture.

This type of brand architecture simply contains independent, unconnected brands.

Benefits of using pluralistic brand architecture:

• Each independent brand can maximize its impact on the market.
• Avoiding a brand association that is incompatible with an offering.
• Owning a new product class by using a powerful name.

A company that launches different brands in different segments usually needs to create separate brands in order to position well in different markets and to different customers.

Famous brands that use pluralistic brand architecture:

• Procter & Gamble — Gilette, Tide, Old Spice
• Unilever — Dove, Lipton, Ben & Jerry's
• Coca-Cola — Sprite, Powerade, Fanta

Did you know that the Volkswagen Group owns Audi, Bentley, Skoda, Volkswagen, Lamborghini, Porsche and Ducati?

4. Hybrid Brand Architecture

The hybrid brand architecture is a combination of two or more brand architectures.

Some sub-brands link to the master brand, but others remain separate.

Hybrid branding is typically used when a firm is often changing brand architectures, or acquiring existing brands through mergers or acquisitions.

Alphabet is an example of hybrid brand architecture.

Firms who need to preserve older product names and designs to keep customers happy often use a mixture of strategies.

Benefits of using hybrid brand architecture:

• Permits the coexistence of old and new products.
• Allows for mergers / acquisitions of different types of brands.
• A major innovation justifies its own name while other entities are closely related.

Famous brands that use hybrid brand architecture:

• Amazon — Amazon Kindle, Amazon AWS, Amazon Echo
• Alphabet — Google, Waymo, Google Ads
• Microsoft — Microsoft Windows, Xbox, Skype

This approach is the most flexible and allows to avoid confusion, while paving the way for future offers.

Why do you need brand architecture?

Companies merge with others and acquire new companies and products — and as a result:

The branding, nomenclature, and marketing decisions become complex.

Decision makers examine marketing, cost, time, and legal implications.

The need for brand architecture is not limited to global best brands or for-profit companies.

Any company or institution that is growing needs to evaluate which brand architecture strategy will support future growth.

How To Create a Brand Architecture?

Deciding the right structure for your brand takes an extensive amount of research.

You must have an in-depth understanding of your positioning, offerings and brand strategy.

Here are the questions to ask before deciding on brand architecture:

1. What are the benefits of using one brand name?
2. Does the new entity need to be distanced from the company?
3. Will co-branding confuse consumers?
4. Do we change the name or build on existing brand equity?
5. Should we ensure that the parent company is always visible in a secondary position?
6. How do we brand this new acquisition?

The way to find out what would work best for your business is to conduct meticulous research.

Only then you'll be able to decide on how to leverage each of your brand divisions to benefit the whole company.

Brand Architecture Benefits

You might be thinking that your brand is too small to benefit from brand architecture.

Building a brand architecture isn't just for multinational corporations.

Even small brands can see measurable improvements in performance by better organizing their offerings.

7 Benefits of having a brand architecture:

1. Ensures the smooth running of an organization
2. Allows to target the needs of specific customers.
3. Balance between the main brand and its sub brands.
4. Allows flexibility for new products and services.
5. Ensures clarity and synergy between brands, products, and services.
6. Maximize visibility in competitive marketplace.
7. Makes it possible to protect brand equity.

There’s a lot of different ways to architect a brand and most large companies that sell multiple products and services use a mixture of strategies.

Conclusions

Expansions, acquisitions and mergers although good for the company in the long run, create a lot of clutter and confusion.

The only way to resolve that confusion is to:

Get a clear view and organize different subsections of your brand.

Remember that the idea isn’t just to come up with some clever brand names (like Apple) or use color for differentiation (like FedEx), but it’s to create clarity from chaos.

1. Firstly, you need to decide how closely you want to associate your divisions to your parent brand.
2. Secondly, make sure every product or service that needs a brand gets a brand.
3. Thirdly, prioritize clarity in the connections across your brands, divisions, products, or services.

Finally, pay close attention to the details of your brand identity system: naming structure, colors, typography, and symbol placement should all align with your brand strategy.

This article was written based on the book "Designing Brand Identity" by Alina Wheeler.