Kellogg‘s is one of the most recognizable brand names in food. Yet when the breakfast powerhouse recently decided to launch a peanut-butter cereal, the brand apparently came to the conclusion that the Kellogg name itself wouldn’t be enough.
So it struck a licensing deal with J.M. Smucker Co. to create Kellogg’s Jif Peanut Butter cereal, whose boxes carry the familiar red, blue and green stripes of the Jif brand, along with Kellogg’s red script.
Licensing deals like this are one of the oldest marketing tricks in the book. But the tactic is getting more love this year as brands look for ways to break through in the increasingly cluttered grocery aisle. In the first five months of the year, 6% of all product launches relied on co-branding, double-trademarking or licensing, which is up from 3.5% for 2013 and 2012, according to a new-product database maintained by market-intelligence company Datamonitor.
Tom Vierhile, Datamonitor’s innovation-insights director, said in an email that the increase in co-branding is a way to break through ad clutter and leverage marketing dollars spent on the brands involved, noting that big players like Nestlé, Mars, Taco Bell and others are all jumping onboard.
There are drawbacks, including the fact that marketers give up total control when they rely on another brand’s equity, said Michael Stone, the CEO of Omnicom Group-owned Beanstalk, a global brand-extension agency. But the upside is that co-branding allows for quicker product launches because marketers don’t need to invest in the startup activities it takes to create a brand from scratch, he said.
Here is a look at some recent co-branded product launches and why they might — or might not — work.
A&W/Betty Crocker Root Beer Float Frosting
Why it might work: Two classic brands. Cake. Enough said.
Why it might not work: This takes the root-beer float one step too far.