Co-Branding: The Pros, the Cons, and the Uncertainty

AuthorKimra Major-Morris - Dineen Pashoukos Wasylik
PositionKimra Major-Morris is the principal at Major-Morris Law LLC in Apopka, Florida. She represents institutional and individual brand ownersincluding high-profile celebrities and creative talent in their business ventures. She can be reached at kimra@majormorrislaw.com. DineenPashoukos Wasylik is Florida Bar board certified as an expert in both...
Pages48-53
©2019. Published in Landslide®, Vol. 11, No. 5, May/June 2019, by the American Bar Association. Reproduced with permission. All rights reserved. This information or any portion thereof may not be copied or
disseminated in any form or by any means or stored in an electronic database or retrieval system without the express written consent of the American Bar Association or the copyright holder.
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By Kimra Major-Morris and Dineen Pashoukos Wasylik
You have a strong brand. I have a strong brand. Let’s
make money together! That’s the business case
for co-branding. While there are many benets to
brands working together to leverage their respective
bottom lines, there are also pitfalls and uncertainty
when the issues are not thought through or when
unresolved legal questions threaten the enforceability of the
subject intellectual property licenses. When lawyers repre-
sent a partner in a potential co-branding situation, they must
be sure to help the client think through the legal and nonlegal
implications of such an arrangement to ensure all involved
get the benet of their bargain.
Co-Branding Basics
Co-branding is a method of trademark licensing (or cross-
licensing) that typically involves strategic marketing and
leveraging by two strong brands to create an enhanced cus-
tomer experience for each brand’s market.1 The brand
partners come together and offer a single product or service
under both partners’ marks.2 It can be an attractive option for
brand expansion by reaching previously untapped audiences
accompanied by the endorsement of a brand those consum-
ers already know and trust. What’s not to like? Each brand’s
success is proven, and the brand partners’ collective custom-
ers anticipate the launch of new products or services and are
brought to the table preconditioned to trust new offerings. It
can also be a cost-effective approach to entering a new mar-
ket, perhaps even giving the brand partners the opportunity to
charge premium rates to the new audience.
Co-branding is about leveraging relationships—not only the
relationship between the brand partners, but also the relation-
ship between the brand partners and their respective customer
bases. Brand owners considering entering into a co-branding
relationship must always bear in mind that their own trademark
is “merely a con-
venient means for
facilitating the protec-
tion of one’s good-will.”3 So
by associating one’s own marks
with the brand of another, a mark
owner is lending its own goodwill to the
co-branding partner, and must choose partners
carefully to avoid dilution. The initial considerations
for potential brand partners are common values, messaging,
and vision. Moreover, it is critical that both partners be com-
mitted to maintaining quality and brand consistency while
offering unique experiences to the collective customer base.
The Pros: Brand Partnerships for the Win!
The Personality Boost
Often, co-branding comes in the form of notable personali-
ties lending their personal brands to products and services.
Near the top of the 2018 world’s highest-paid athletes list
are LeBron James, Steph Curry, Kevin Durant, and Russell
Westbrook.4 What they all have in common is an effective
co-branding deal with an athletic shoemaker. At the height of
his fame, Michael Jordan boasted co-branding deals with the
likes of Nike, Gatorade, McDonald’s, Coca-Cola, Wheaties,
Hanes, and more, topping out in 1997 with an annual payday
of more than $78 million for his basketball and co-branding
efforts combined.5 But retiring from basketball didn’t reduce
Jordan’s co-branding income: Nike alone pays him more than
$100 million a year for his co-branding of the Jordan brand,
which sounds like a lot until you realize that Nike generated
$2.8 billion in revenue in 2016, and projects $4.5 billion by
2020.6 There are countless owners of “Jordans” who bought
Nikes to be “like Mike.” The partnership has been a huge
success.
CO-BRANDING
Image: iStockPhoto

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