A Branded House or a House of Brands?

In our line of work, we are often posed the question of how a company that has several, or many brands, should brand and organize these properties into a coherent whole.

The commonly used terms are “branded house” or “house of brands”, which is a simplified way of understanding this question.

The former denotes a portfolio where every brand is part of a clearly unified system, such as all the Virgin properties. From Virgin Music to Virgin Radio and Virgin Airlines, the visual branding is absolutely consistent, and so too the values and personality traits.

The latter – “house of brands” – I consider a bit of a misnomer, as it’s not a “house” at all. It’s a collection of distinct and disparate brands with very different identities, audiences, and even values. A famous example would be Axe vs. Dove, which have diametrically opposed value systems but are both owned by Unilever. Even their very names seem to conflict with each other.

Is there a rule of thumb when determining where your set of brands should fall along this spectrum of consistency to differentiation? Well, to me the only real determining factor should be: Do the different brands offer a similar promise? And is there an authentic value system that runs across them, that the consumer will be able to feel and rely upon? If yes to both questions, then one should consider branding them similarly, with a strong family resemblance — not only because it speaks the truth of what you’re offering, but because it will build equity in the ‘family’ of brands. As well, highly consistent and organized brand hierarchy systems are easier to manage.

But if you cannot or don’t wish to offer a similar promise, if the consumer cannot expect a similar set of benefits and values to emanate from your various brands, then best to brand them separately. The caveat here is that sooner or later, the public will find out that you make brand x and brand y as well. So you’ll need to be careful what kind of story you’re telling with these various brands, as the authenticity of your claims will be called into question if you’re inconsistent.

On a personal level, it’s painful for members of my family, who are longtime drivers and fans of Audi vehicles, to witness what’s happening with VW. They’re aware that Audi is owned by the same company, and while they don’t own diesel vehicles, they cannot help but wonder whether they can really trust the management who created their beloved Audis. Whether your siblings or children share your last name or do not, they come from the same family. And the family name of that corporation, has been irrevocably damaged.