Sunday, November 25, 2012

Brand Linkage: Don't just advertise your category, advertise your brand

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If your company pays to advertise, one of the factors to consider is how well your advertisements are linked to your brand.  In this post I'll be referencing television commercials since they are vivid examples that most people can relate to, but the concepts can apply to all advertising media.

I'll explain what brand linkage is, why it's important, and what happens when great advertising has poor brand linkage - it's not always bad, as long as you're the industry leader, as illustrated by the Energize Bunny example.


Have you ever watched a TV commercial that was incredibly amusing, but once the advertising was over, you couldn't recall the brand being promoted?  Or have you ever seen an entertaining ad in which the product category (e.g., beer, athletic footwear) was very memorable, but the specific company or brand behind it was not?  These are examples of advertising with poor brand linkage - they were not able to connect the appeal and message of the ad to a specific brand.  With good brand linkage, the consumer strongly associates the brand with the message.


Without strong brand linkage, you might promote your industry or category without helping your own brand.  Or, you might go through a lot of effort to amuse television viewers for 30 seconds with no specific benefits to your brand.  At worst, you could pay a lot of money for advertising that ends up helping your competition.


In the 1990s, the Energizer battery company launched a series of memorable commercials in which the Energizer Bunny - a pink toy rabbit that plays a bass drum - would continue to perform and roll around the screen long after toys powered by other batteries had died.  The Energizer Bunny was also a spoof on similar bunnies that the industry leader, Duracell, had used in their ads.  Unfortunately for Energizer, many consumers thought the ads were for Duracell and Duracell continued to maintain their leadership position.  


You don't have to feature your competition in your advertising to inadvertently help them.  Launching ads that have poor brand linkage and/or highlight your category instead of your brand will end up helping the category leader.  Here's how that works:
  1. Your advertisement promotes your product category
  2. Consumers see it and are moved to buy more of the category
  3. They spend more on the category, but on the brands they already buy
As a result, any incremental demand in the category your advertisement generates will generally help companies in proportion to their market share.  So, by promoting the category, you're promoting the market leader, which is OK as long as you're the market leader - or, if you're advertising regionally and you're the local leader

Let's suppose you run a small, new, but promising canned soup company and you start running advertising that does a great job of motivating consumers to buy more canned soup.  Unless that advertising also strongly links the advertising and those purchases to your brand, consumers will buy more, but not from you.  Instead, they'll just buy more soup from the brand(s) they already buy.  Campbells owns about 60-70% (Campbells, Yahoo Finance, Businessweek) of the canned soup market - as a result, they will capture roughly 60-70% of the incremental soup business your advertising generates.


If you have a new player and/or have relatively low market share in your category, it is especially important that your advertising have strong brand linkage.  Reasons for that include:

Introduces customers to your brand

By linking your unknown brand to a product category and/or a great advertisement, you help customers understand and remember what you are selling and what you stand for.  This is particularly important if you're a new brand or in a highly fragmented market.

Helps you capture the demand you create

Going back to the soup example, strong brand linkage will motivate customers who see your ad to buy your brand of soup, not just any soup.  This will help you stop paying for advertising that helps your competitors.

Make the most of your advertising spend

You have finite resources to spend on advertising and strong brand linkage will help you get the most out of what you invest and any positive impact your advertising has on consumers.


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