Morning (and happy new year!).

We’re written before about the nuances between Brand Extensions and Sub Brands, as well as the fine line between Sub and Endorsed Brands. 

Today, I want to talk about Endorsed Brands vs. creating a new, standalone brand, and use cases for when you might consider one approach over the other. 

We’re seeing this decision come up more often in our work these days as breweries launch new products (beer or beyond), or bring a new taproom concept online, or figure out how to handle the branding for a business they recently acquired.

This is an interesting topic that you may encounter this year, so let’s get into it.

(Above): Today's issue focuses on the right side of the Beverage Brand Architecture Continuum.

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First, a few quick definitions. From The Beyond Beer Handbook here:

An Endorsed Brand is built to stand mostly on its own, but with some sort of endorsement—an assurance of quality, trust and credibility—from your established parent brand. An Endorsed Brand leverages the mind share and reputation of your parent brand while insulating it to varying degrees.

A standalone, or new brand has zero connection with your parent brand. Under this approach, each brand has its own positioning, brand identity, personality and voice, value props and messaging, and is completely independent as far as the consumer is concerned.

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Now that you've got a lay of the land, let's explore when an Endorsed Brand can make sense.

(Above): Endorsed Brand examples.

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An Endorsed Brand can make sense when:

When you are a specialist and planning to make something markedly different than what you’re known for

This point is so important, that it acts as sort of a go / no-go question on our Beverage Extension Assessment Tool (B.E.A.T.). Meaning, if you’re a specialist brewery, that is, you’re known for making a singular style (all lagers, all sours, etc.), then anything you release that runs counter to this style risks muddying your parent brand’s positioning.

So an Endorsed Brand (at the very least) can make sense for your new product if there’s a compelling reason to maintain some tie to your parent brand. That could be that you’re targeting the same audience, but maybe a markedly different occasion, or you want to take advantage of existing distribution channels, or if you expect your parent brand to see a nice boost (the halo effect) by being associated with this exciting, new product.

Consider the halo effect & how this can benefit your parent brand 

One of the biggest risks of overextending your brand, via Line / Brand Extensions and overall category creep, is changing what your brewery stands for in people’s minds. This is a phenomenon we refer to as repositioning your parent brand. (E.g. is Bud Light a beer brand, or a hard soda-seltzer-lemonade-cider-chelada brand?)

We’re currently writing a standalone BBT issue on this topic—stay tuned—but we can touch on it here briefly. 

Repositioning your parent brand (due to misaligned extensions) is almost always framed as a negative thing. But there are instances where you can positively reposition your parent brand via association with a wildly successful new product.

And this is one variable you may consider when deciding between launching a new product with an Endorsement vs. as a standalone brand. What benefits can your parent brand see from this association? 

I use (and will continue using—see below) Bud Light as an overtly negative example here.

A positive example would be Voodoo Ranger, which still maintains a small Endorsement from New Belgium even though, I would wager that functionally, this brings nothing to the table at this point in terms of nudging people to trial the Voodoo line itself.

Instead, this Endorsement exists to invite Voodoo Ranger drinkers to look into other New Belgium products.

(Above, Top): Note the simple New Belgium Endorsement on all Voodoo Ranger products.

(Above, Bottom): Is Bud Light a beer brand, or a hard soda-seltzer-lemonade-cider-chelada brand? ABI has hollowed out this brand with countless Brand and Line Extensions. An Endorsed approach could have taken some of the sharper edges off of some of these new products (Bud Light Seltzer Hard Soda… what are we doing here?).

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A standalone (new) brand can make sense when: 

A link to your parent brand just doesn’t make sense 

An obvious point here is when any tie to your parent brand will hurt the credibility of the new product, or your parent brand 

This can be due to misaligned values, target audience, occasion, category, price point—whatever the reason—a connection doesn’t make sense.

When you want to create a brand that can travel 

We’re seeing a small trend right now, especially amongst our Legacy and Regional Brewery clients of re-entrenching in their home territory. That is, pulling back from further afield markets to focus on their backyard. 

And this makes perfect sense in a world with ~10k breweries. But even with these moves happening, there’s still a desire to find growth by reaching into neighboring markets, if you have a product that consumers actually want—that has an actual reason for existing—and if that brand can credibly travel into those adjacent markets to serve them.

One specific tactic we’re seeing here is launching a new brand, with zero tie to your parent brand, specifically to go out into neighboring markets in a way that your parent brand might not credibly be able to do. 

Here, you're still facing the long term work of building up a new brand, but at least you're not doing so under the yoke of your parent brand's reputation.

(Above): Sierra Nevada's growing beyond beer range gives us some great examples of these different Brand Architecture approaches. 

Their Little Thing line is an Endorsed Brand, whereas Strainge Beast Kombucha is an entirely new brand. The former is a beer that aligns well with their current positioning, whereas the latter is an entirely new product. And Kombucha, in particular, is a tough positioning challenge, at the category level. So much better to swing wide and not tie this to their parent brand.

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Some finer points & caveats 

Is there a cost difference between these approaches? 

Functionally, an Endorsed Brand and a new standalone brand will require the same level of budget and time and energy to get off the ground.

Counterintuitively, an Endorsed Brand may be more difficult (from a design perspective) because you have to sort out to what degree you bring the parent brand into the fold vs. creating a new brand where you can just design something to stand on its own from the jump without having to resolve this relationship.


Do you have the capacity to pull this off? 

One reason you might choose a Sub Brand vs. an Endorsed Brand is that you generally don’t need as much capacity (time, budget, staff) to promote and build a brand that is closely aligned with your parent band. This is one of the Sub Brand's main draws—any move you make to build your parent brand, or the Sub, can work hand-in-hand to raise awareness of your entire enterprise. 

This becomes an important distinction for considering an Endorsed Brand or a standalone brand. In either case you'll have to bring the same resources to the table to build this brand as you do your parent brand.

That means you’ll need people and budgets and annual planning to build a new brand.

So if you’re a smaller brewery with limited resources, you may want to consider some level of Endorsement instead of creating a new brand (at least initially) because this gives you an important connection with your parent brand that can act as a force multiplier for a smaller team. 

Though if you're really resource strapped, it may make more sense to firmly align this new release with your parent brand as a Sub Brand (assuming doing so won't harm your parent brand and will set up the new brand for success).


Be wary of Brand Dilution

A final caveat here: As with any of Brand Architecture move (e.g. Line and Brand Extensions, Sub Brands, Hybrid Brands), balance is key. An Endorsed Brand can be a great way to extend into another category, but if you overuse this and launch dozens of Endorsed Brands, you can start to weaken the strength of the parent brand in the minds of your customers, no different than if you release a series of misguided Line Extensions.