ABSTRACT
Co-branding alliances constitute a weapon for firms as they attempt to transfer the positive associations of their partners' products or brands to the newly formed co-brand, or composite brand, create synergy between existing brands, or even build up (or change) an existing brand. This chapter discusses the co-branding alliance challenge and details mechanisms for dealing with it. It presents the alliance development framework to develop managerial guidelines for co-branding alliances. Ingredient co-branding alliance is the most intensive form of collaboration, because it involves multiple departments, including product design, production and marketing. In managing co-branding alliances, firms may focus on five instruments that influence the emergence of positive–and prevent the creation of negative–spillover effects. The instruments include brand and product fit, pre-existing brand attitudes, brand equity, alliance partner behaviour and contractual provisions. The chapter concludes with a summary and a case illustration.
