What is a hybrid brand architecture? It is a mash-up architecture that might seem all over the place on the surface but is adopted by companies for its many benefits. The master brand here is like a very intelligent father who knows when to step into the lives of his children and when to keep out. Thus, a hybrid structure sometimes is very well thought-out.
Hybrid Brand Architecture
As the name suggests, hybrid structure combines the characteristics and features of multiple brand architectures, more specifically the house of brands and the branded house. The intelligent father (the parent brand) understands when his children need him in the back cheering for them and when they don’t. He knows when his support for his kid is in their favour and when it could damage his own reputation, so he takes his steps very carefully.
Brands That Use Hybrid Structure
Microsoft uses the hybrid strategy because it has hundreds of products in numerous markets. Microsoft Windows, Word, Excel, PowerPoint, Microsoft Surface, etc. are brands that fuel the reputation of the parent brand. On the other hand, you have Nokia, Skype, Xbox, Visual Studio, Zune, etc. that seem (are) like freestanding brands. Banyan Tree is a good example of a brand that uses this strategy.
Another one is Alibaba. On the one hand, you have brands like Ant Financial, Tao Bao, etc. and on the other hand, you have Alibaba Cloud, Alimama, etc. Similarly, you have Walt Disney with several brands with which its name appears and several other brands that seem like parent brands within themselves. Brands where its name clearly appears include Disney Nature, Disney Store, Walt Disney Animation Studios, DisneyToon Studios, etc. Brands that look standalone brands but are children of Walt Disney are FreeForm, ESPN, ABC, etc.
In the end, it is clear that a hybrid strategy is nothing less than hitting two birds with one stone. It’s a very clever father who knows when to step into the matters of his kids and when to stay behind and avoid ruining its established reputation.
Why Brands Use Hybrid Structure
There can be a variety of reasons why a company chooses to go with this brand structure. We can take the example of Toyota here. When Toyota started, it only had one brand and that brand represented reliability and safety. Toyota offered this reliability and safety to the mass market through its cars. However, when it came to targeting a different market segment with premium cars, this brand designed for the masses was not suitable for this job. As a result of that, Toyota gave birth to Lexus, and now it is serving both the market segments but without hurting it original brand Toyota. This means hybrid structure helps companies penetrate into new market segments without putting the parent brand’s reputation on the line. The hybrid architecture also serves as a shield to the effects of mergers and acquisitions. Take for example the acquisition of Jaguar by Tata. Now, both the brands here have a great reputation and brand equity. Renaming the brands could alienate their respective customers.
Sometimes, the hybrid brand structure is just a result of the mishmash because the company creating new brands does not look at its brand architecture as part of its branding strategy. It creates a brand when it feels the need without paying attention to brand architecture.
So, it is clear from the above examples and explanations that hybrid brand structure has its great benefits for companies e.g. touching new market segments, facilitating mergers and acquisitions etc. Now, when you look at Microsoft and Walt Disney, and the long chain of non-uniform looking brands underneath their names, you know they are the wise fathers of some very famous children.