12.04.2017

Apple and Mercedes? or Apple and Hyundai? Why Some Brand Alliances Make More Sense Than Others

VAN DER LANS, Ralf | Van den BERGH, Bram | DIELEMAN, Evelien

Brand alliances bring together two or more brands in joint marketing events that in theory should benefit all participants. But the science behind which brand alliances make the best “fit” has been weak, complicated by the difficulty in collecting data and determining the best measures. The reason is that brands are strategically combined into alliances, which makes investigation challenging. Now, a group of researchers has addressed the gap by creating a model that lets them measure consumer ratings of real brands, as well as their favourability in different combinations.

The study by Ralf van der Lans, Bram Van den Bergh and Evelien Dieleman explains the different responses to brand alliances and tests them, even when on the surface these alliances can sometimes seem perplexing.

“Why is Red Bull teaming up with a somewhat dissimilar brand, Nissan’s Infinity, on a Formula One race car, rather than Ferrari, which has a more similar brand image? Or why is the Qatar Foundation sponsoring F.C. Barcelona’s soccer shirt alongside UNICEF, rather than displaying its logo next to Emirates’ on Real Madrid’s shirt?” they said.

“We wanted to show that the conceptual coherence between brand personality profiles is a strong predictor of brand alliance evaluations.”

Brand personality has been studied under other conditions and relates to human-like characteristics that consumers frequently attribute to brands. Five dimensions in particular have been singled out: sincerity, competence, excitement, sophistication and ruggedness. The authors refine these categories further into two types: intrinsic dimensions which correspond more closely to human personality dimensions and here include sincerity, competence and excitement; and extrinsic dimensions, which are more related to sociodemographic features rather than personality and here include sophistication and ruggedness.

The authors hypothesise that brand alliances will be more favourably evaluated if they are somewhat dissimilar on intrinsic dimensions and similar on extrinsic ones – much like a romantic couple may be better suited if they come from similar backgrounds but have somewhat dissimilar personality traits.

They test this by having 100 brands evaluated for their brand personality on the five dimensions by 204 participants (each was presented with 10 brands). Another group of 201 participants then evaluated 1,206 brand alliances involving those 100, which they were told were jointly sponsoring an event (each participant was presented with six alliances). The results largely upheld the hypotheses with some modifications.

“Although we find strong support for our hypotheses related to extrinsic dimensions, our conclusions for intrinsic personality dimensions were mixed,” they said.

“Similarity in extrinsic dimensions and moderate dissimilarity in intrinsic dimensions fostered favourable evaluations of brand alliances. But combinations involving ‘exciting’ brands resulted in favourable evaluations irrespective of similarity or dissimilarity, and competence was a less important dimension.

“In sum, it is as if partners should look the same on the outside, for instance sophisticated (such as upper class and glamorous) or rugged (such as outdoorsy and tough), but be different on the inside.”

For managers, the findings and approach used in the study could help them to identify ideal partners for brand alliances. In particular, the brand personality information is a useful tool for comparing brand alliance fit because each personality dimension can be represented separately– something the authors do in a table of car manufacturers and technology companies. This helps firms to identify or avert alliances which might not be obvious. For instance, Apple, which is rated highly for excitement and sophistication, combines well with automakers such as Mini and Mercedes Benz, but less well with the more rugged Ferrari and Porsche. Honda, Ford and Toyota, on the other hand, are a better fit with Sony.

“These examples highlight the importance of conceptual coherence in brand personality profiles. Indeed, attractive alliances do not result from simply pairing with an exciting brand such as Apple,” they said.

The authors point to further avenues for research, such as whether the benefits of brand alliances outweigh the costs, whether the kind of fit described in the study pertains to other circumstances other than a one-off event, and whether there are impacts on such hard metrics as sales and market share.

VAN DER LANS, Ralf

Professor
Marketing