As a promotion tactic and one of the secondary brand associations, co-branding is an event where multiple famous brands work together for a product or campaign. These brands may belong to the same companies, or from different ones. Because consumers adopt the co-branding product faster and set higher expectations of the quality, companies have to evaluate co-branding carefully before they can enjoy a revenue increase. For one, co-branding may allow the company to access into a new channel. Hence, the company gains more exposure and sales. For another, the success of co-branding depends on the fitness between the two brands. The more complement they are, the more likely they are to drive sales.
For example, we often see sponsorship from prominent hotels and airliners to concert performances. This association allows the companies to link themselves with the status of famous musicians and performers, conveying a message of elegance and prestige. Meanwhile, the concert organizer benefits from additional exposure of the events and enjoys more ticket box sales. However, if the concert quality turned out to be controversial, reputations of all the brands involved would be damaged. In brief, a company has to evaluate co-branding opportunities and investigate the brand it seeks to work with.