In this opinion piece by Rachel Tucker, associate at Sayers Brand Momentum, she breaks down how collaborations between brands can help service a beautiful matrimony between companies to sell more, make an impact and even make a mark on the internet.
What do Crocs and KFC have in common?
Literally, nothing.
But they make for a mean collab, achieving ‘sold out’ status of their chicken printed clogs topped with a chicken-scented charm just half an hour after launch. Originally priced at $59.99, unlucky fans reported scalpers reselling the ‘limited edition’ collab item for up to 600% mark up. The hype around such an offensively unaesthetic shoe certainly raised eyebrows, but for all (…are there really that many?) Crocs obsessed consumers out there, this would have come as no surprise.
Like many other brands, collaborations have become a central part of the businesses marketing strategy. After the ‘fashion faux-par’ shoe earned the status of ‘unwearable in public’ and subsequently were on the brink of bankruptcy, the brand pivoted in the mid 2010’s with the help of Hollywood’s elite and premium brands to become the most fetch footwear in market.
Christopher Kane’s use of the shoe in his 2016 pre-fall collection was the catalyst of the Crocs renaissance; after which Vogue reported Crocs as being ‘ridiculously chic’. Balenciaga quickly followed before names such as Post Malone and Justin Bieber received their own capsule collections. Some may say Crocs marketing behaviour during this period was a Hail Mary grab at the coattails of culture, but I believe this strategy was nothing short of genius. In 2020, Amazon reported a 12 million percent uplift in traffic and the brand saw revenues climb by 64% in the first quarter of 2021.
Here, the power of collaboration is evident. A tool so many brands use, not only for maintaining relevance or redefining positioning in market, but for access, reach, impact and growth – and ultimately, brand building.
Brand collaborations operate on a spectrum from ongoing co-branding (think Nike X Jordan), to collaboratively designed collection (think Fenty x Skims), to limited edition product creation (think IKEA x Off White). Whereby the objectives are to:
Access new audiences and markets:
There is a multiplier effect on bundling brand audiences and attracting new audiences through appealing symbiotic pairings or high/low price point. Not only do brands receive access to a new pool of consumers (and their communications data), but collabs increase access, brand affinity and relationship building for the next wave of future customers. H&M were OGs when it came to providing a mass market audience access to high end fashion with their numerous cult designer collabs in the early 2000s including Balmain, Moschino, Versace and Kenzo; all of which sold out in seconds.
Cross region collaborations also break down international barriers and boarders, allowing consumers greater access to global brands, including people and groups, they wouldn’t
otherwise be able to access without hopping on a plane (or paying an insane shipping and handling fee, no thanks). A great example of this was McDonald’s collaboration with BTS. The collaboration allowed 50 different global markets access to the Korean based, K-pop kings, leveraging their western and eastern influence to generate mass hysteria and hype in countries they are not physically present in. This allowed fans access to the band via local McDonalds stores and products, in turn generating global same-store sales increase of 40.5% on average for the quarter ending June 30th, 2021. Borrowing brand (or band) clout at its absolute finest.
Create reach through earned media:
Collaborations are PR juggernauts. Whether they make total sense (such as Redbull x GoPro) or are totally absurd (such as Spam x Huf), often brand pairings drive more impact, interest and earned media together than either brand alone. The mechanics in which drive this are artificial scarcity of collab collections and genuinely intriguing or useful co-creations that make the consumers life better.
An example of this is the Nike Apple watch. Of course, both brands generate a heap of PR on their own, but the launch of the Nike Apple watch saw immediate success as it was functionally positioned as the ‘perfect fitness partner’; featuring in articles from Buzzfeed, to New York Times, to Women’s Health.
Another interesting example is the consistent brand collaboration strategy of Supreme; a brand that has arguably been built entirely through borrowing equity from others. After hundreds of incredibly successful collab campaigns with brands such as Braun calculators, Colgate toothpaste and even Oreos, I’m left questioning if there is any partnership the brand can activate that won’t generate thousands of earned media hits and sell out in seconds.
Achieve commercial growth:
There’s no doubt collaborations create the potential for serious short-term sales. It comes back to that idea of artificial scarcity where vernacular such as ‘limited edition’ and ‘exclusive’ has the power to drive purchase. We can safely assume collaborations are an easy way to increase short term sales, but they do leave marketing professionals questioning: What, if any, is the long-term brand benefit?
One example of a brand collaboration that has nailed sustained growth is Gap x Yeezy. When the pairing was announced in 2020, Gap’s stock increased by 19% in a single day and the original collab produced product, ‘The Perfect Hoodie’, generated the most single day sales for Gap since it was founded 53 years ago. Yes, they nailed the short-term sales growth, but the approach to long term brand building was phenomenal. Both brands recognised there were natural overlaps in values and products yet attracted completely different customers due to latent brand perceptions and price point. The well-priced collaboration led to a 70% increase in new Gap customers, plus an influx of a new audience group for Gap – Gen Z and Gen X men from diverse backgrounds. In recognising the value of these customers, Gap and Yeezy announced a decade long brand partnership and now have ambitions of being valued up to $4.7 billion. A true success story in achieving long term brand building and subsequential commercial growth.
Although collaborations can be incredible marketing tools, due to the intermingling of brand, commercial and corporate assets, there is always a possibility that brand partnerships can go pear-shaped. Many risks present, including ineffective partnership, diluted brand equity, one-sided brand benefits, reputational decay or public outrage which can impact brand building and return on investment. We’ve all seen examples of brand collaborations that have gotten it oh so wrong, but a standout for me was the Pepsi x Kendall Jenner campaign. The partnership so poorly communicated that ‘sharing a Pepsi can stop civil unrest’, leading to sentiment that the brand, and Jenner, were tone deaf and lacking social consciousness. Another fail was Forever 21 partnering with weight loss solutions brand, Aitkin, to provide all online consumers with freebies. As you can imagine, customers we’re far from happy, claiming Forever 21 was fat-phobic and exclusive. It must be noted, that while failed collaborations can have detrimental impact to brand in the short term, both Pepsi and Forever 21 have bounced back just fine.
None the less, several learnings can be distilled from the above as principles of a bangin’ brand collaboration that just might build your brand as a result.
Berries and cream, berries and cream:
I believe there are two types of collaborations: Absurd and nonsensical partnerships that attract interest, and partnerships that just make sense and add value to the intended consumers life. The latter can be labelled a ‘berries and cream’ partnership where a natural synergy and symbiosis between each brand should be obvious and deemed permissible to the everyman. A great example of this is Taco Bell x Doritos (a natural fit, if you ask me), where both partners co-branded a product, the Doritos Locos Tacos, to provide consumers with a crunchy taco shell with classic Doritos taste. This ultimate ‘Berries and cream’ collab sold over 1 billion units in the first year of partnership.
Tap into incremental audiences:
As Gap and Yeezy managed so perfectly, the ability to attract and keep new audiences is a core measure of success for brand collaborations. The required strategy to achieve this is looking at collab partners that have adjacent loyal customers that are deemed difficult to access or attract. For example, the recent co-produced ‘Moonswatch’ by Omega and Swatch, allowed both brands access to a similar yet adjacent audience: Watch fanatics with either very high, or very low, buying power. A fantastic case study of luxury meets mass; presenting a more accessible price point through Swatch to attract and build affinity within a future Omega Speedmaster Moonwatch audience.
Do you care? Would you share?:
Pointed out above, reach is a core objective of a brand collaboration. The multiplier effect of two or more brands partnering, added to by artificial scarcity, have the potential to attract more hype, notoriety and PR than either brand solo. When strategising collaborations, it’s important to question: Will people actually care about this? Will people actually share this? Creating collaborations with consideration of earned and organic media hooks is imperative to achieving reach and interest. The most effective way to achieve this is leveraging trending cultural topics, brands or personalities; a strategy that Gucci have nailed. What better way to achieve virality than partnering with humble TikTok star Francis Bourgeois and hype beast
brand North Face to produce a collab collection that no one knew they needed. Although the popular train spotter is everything that Gucci is not, the collaboration went full steam ahead due to the existing, socially led clout that Bourgeois has captured, resulting in incredible reach and a sold-out collection. A true example of a brand partnership closing the gap between the worlds they inhabit, and the world of influencer led subcultures.
The borrow back:
Clearly, in the age of the collab, your brand is for lease. It can be borrowed, appropriated, played with, improved, altered and use for another’s benefit. So often brand collaborations can be one sided or entirely advantageous for one party. To mitigate this, ensure fair and mutual benefit for both brands is considered in the planning phase and contractual agreement. A consideration of ‘borrow back’ is particularly important for the brand that may hold more equity, attraction or iconic status. An example of an excellent shared benefit brand collaboration is that of Alexander Wang and Uniqlo whereby Alexander Wang was provided entry into a new product market (HEATTECH) and audience group (value-based yet luxury aspiring customers) via production and distribution and Uniqlo was able to burnish it’s increasingly ‘accessible luxury’ perception via the co-branded products.
The power of the humble brand collab is abundantly clear, and certainly an important facet of a brands marketing strategy to meet the changing needs of the modern-day consumer. Whilst short term benefits are clear in the form of sales and reach, it’s increasingly important to consider how a flash-in-the-pan partnership will impact long term brand perception and growth. With consideration of the above points, achieving sold-out status and building brand in the long term through a brand collaboration doesn’t have to be mutually exclusive.
