What we know about brand architecture

Source: WARC Best Practice, August 2019

Downloaded from WARC

Explores key insights on brand architecture, or the organisation of a brand portfolio, highlighting
methods and techniques to maximise the value of a portfolio while keeping clarity for consumers and
employees.

There is no 'one size fits all' brand architecture model, rather a wide range of choices. A well-defined
architecture is particularly important when launching new offerings or acquiring new brands.

Definition
Brand architecture is the organizing structure of a brand portfolio. It explains relationships between brands –
what they have in common, how they are different and how they support each other. It can be for a total
corporation or an individual brand. It should be a blueprint for maximizing the value of your brand portfolio by
providing clarity for consumers and your internal organization.

There are four basic brand architecture strategies: “house of brands" which consists of independent, standalone
brands; "branded house" which uses a single master brand; "endorsed brands" which are independent but also
endorsed by another brand; and "sub-brands" which are connected to the master brand and its associations.

Key Insights
1. Visual symbols and sonic branding are increasingly important tools to hold a brand’s
architecture together

As the landscape becomes increasingly digital and the devices used get smaller, visual symbols are becoming
more important. And with the rise of digital audio and voice, sonic branding is also increasingly crucial.
Mastercard, the global payments company, realised that in order to optimise its brand presence and impact in
the digital space it needed to alter its logo. The Mastercard name has been dropped in markets where the brand
is well known, leaving the iconic concentric circles as the symbol brand. Furthermore, Mastercard has spent two
years developing a sonic brand architecture to help it stand out in an environment of visual overload. This
included a core melody adaptable to many situations and countries and a three-second “musical logo”. Rival
payments company Visa has also developed sensory branding assets – a bespoke sound and phone vibration
to accompany a branded animation - to identify the brand at point of purchase even when there is no physical
card used. Financial services organisation HSBC had also implemented an icon led identity and ruthless brand
architecture to consolidate the brand and make its presence more coherent and effective in the digital world.
And it has developed this further with a brand sound present at all touchpoints.

Read more in: Why Mastercard dropped its name from its logo, Lessons from Mastercard on how to
create a sonic brand identity, Visa taps the power of sensory branding, HSBC: How a global citizen
rediscovered its voice in a changing Britain and Audio: Prospering in the ever-present medium – Admap
summary deck

2. Brand architecture best practices are evolving

The digital revolution is impacting how firms build and manage their brand architecture. There is a shift from
traditional architecture models built on image to new models built on data/intelligence – AirBnB and Netflix are
the most commonly cited examples. These new models are more fluid, flexible and adaptable. The reality is that
with limited time and shorter attention spans, consumers care less about brands than about solving the
challenges they face in their day to day lives. Ecosystem brands are set up to help achieve this. There is also a
desire by many companies to support fewer, stronger brands. The effectiveness and efficiency of elastic mega-
brands is highly appealing, especially in today’s constrained budget environment. The challenge, however, is to
not spread oneself too thin and to truly deliver on the brand promise in each and every category.

Read more in: Brand architecture in the digital age and Mastering brand architecture in a hyper-
competitive digital era

3. An “elastic” brand can stretch into new categories

AT&T has successfully extended beyond telecoms into a growing range of media and technology categories
thanks to having an “elastic” brand. It found in research that it has high consideration levels in categories where
it currently does not play. It is deliberately seeking to shift brand perception and stretch it even more by building
its credentials in the tech and media spheres through new brand identity and initiatives in e.g. film, music and
content creation.

Read more in: AT&T finds new ways to extend its “elastic” brand

4. Marketers need to become “conductors” of brand complexity

Today brands have multiple offerings and stakeholders, across categories and borders. A marketer needs to
manage them all simultaneously by becoming a conductor of the brand who brings coherence without
oversimplifying. A framework that separates long-term brand positioning and a number of shorter-term
propositions can help sustain the depth and variety the brand needs to grow.

Read more in: Marketing is complex, not simple

5. Brand architecture requires clarity on brand relationships and roles.

A framework of six questions can help clarify and evaluate existing or new architectures:

1. How do the brands relate to the corporate brand?

2. What do the brands derive from the parent and what do they give back?
3. What role does each brand have in the portfolio?
4. Are the brands and sub brands sufficiently differentiated?
5. Does the consumer understand the differentiation?
6. Is the whole brand architecture greater than the sum of its parts?

A new architecture should start with a picture of the ideal architecture, based on the master brand
vision/essence and review of the market structure. Brand propositions can then be developed and decisions
made on whether existing, evolved or new brands can address them.

Read more in: Building Brand Dynasties Family Trees that will last

6. Brand architecture should reflect a business' growth strategy.

It is advisable to develop brand architecture around the company's growth strategy, not its existing business. It
will then reflect growth goals and choices, and bring to life the uniqueness of the brand and its role within a
category. In this approach, a clear, distinct growth role is required for each brand, sub-brand and product, based
on a clear benefit for a distinct audience. This helps identify rationalization opportunities and gaps requiring
innovation. The need to maximise financial returns will drive you towards as few brands and sub-brands as
possible, given the huge cost of developing, launching and sustaining them.

Read more in: Brand portfolio strategy and Brand architecture for business growth

7. The current masterbrand trend will not suit all organisations

Brand architecture decisions should be driven by the ambition and resources of the brand or organisation, the
diversity of audiences it interacts with and how adaptable it needs to be to accommodate its NPD pipeline. The
current trend towards master brands reflects the financial climate and brands articulating ambitious 'brand
purposes'. However, trends in digital media, supply chain technology and innovation models suggest more
complex and adaptable architectures may be needed.

Read more in: The 3A's of masterbranding: Ambition, Audience and Adaptability

8. Key brand metrics can help measure brand architecture outcomes to identify the best
scenario

Millward Brown Optimor use six critical brand measures to answer key architecture questions, such as the need
for a new brand or portfolio size, with predictive numbers:

1. Is the brand strong?

2. How well does the brand measure up to the key buying factors, and therefore fit, in a category?
3. Can the brand stretch into new markets and retain its strength and fit?
 4. Where should I invest my marketing spend for the best ROI?
5. Do my brands have discrete positionings?
6. What is the financial impact of alternative architectures?

Read more in: Use metrics to predict brand portfolio outcomes

9. Sub-brand identity needs to be carefully managed to avoid confusion

Sub-brands make sense to stretch a strong master brand into a new sector/category, re-energize a weakening
master brand, counter a targeted competitive brand or signal a breakthrough offering. Done well, sub brands
can also bring clarity to guide consumers to the right product for them. However, too many sub-brands can lead
to starving the master brand or the most strategic brand-building programmes, and consumer confusion, if there
is no clear differentiation. Sub-brand launch identity should balance existing master brand identity and creating
its own visual space so that it both leverages master brands assets and is visible. Priority should be to protect
the master brand from harm by avoiding any clash of identities. The sub-brand identity should:

Avoid creating a distinctive asset of the same type as a master brand distinctive asset
Stay consistent with any master brand assets that are not optional e.g. colour, font, pack shape
Articulate the distinctive asset that connects it to the master brand and ensure its more substantive than
any differences
Stretch rather than replace an existing brand asset to create a new one
Avoid the obvious when creating new assets to deter competitive copying

Read more in: To sub-brand or not to sub-brand and How to expand your brand architecture: strategies
for successful brand launches

10. A well-defined brand architecture will help inform acquisition strategy.

'House of brands' companies need to ensure the costs of managing acquired brands do not outweigh the
benefits, especially if there is product overlap, and that they are clear on how to add value to or derive value
from them. If acquiring brands from a larger company, they will need to factor in reduced sales, marketing and
R&D support that may impact brand value. 'Branded house' companies will fold acquired brands into their master
brands, so need a well thought through transition plan to transfer the equity to the master brand. The aim should
be for customers to see the acquisition as just a name change. Added value will come from consolidated
operations and acquired products and services.

Read more in: M&A: merged brand clarity

More on this topic

Topic page: Brand models, architecture

Topic page: Brand Extensions

Best Practice: What we know about masterbrand strategies

Best Practice: What we know about brand naming

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