When customers know the sub-product brand better than the parent company, a business has two directions: let the sub-brand lead within each category, or gradually raise the parent name to build shared brand equity. Each direction makes sense under certain specific conditions, and both carry risk without a clear strategy from the start.
In this article · 6 sections
Some product brands are known by heart to their buyers, while few people notice the company behind them. That is not strange. But when a business starts to expand, launches new product lines, or needs to raise capital and hire, a new question surfaces: where does the brand equity actually sit, and who is carrying whom?
Two fundamental structures
According to David Aaker in Brand Portfolio Strategy, businesses tend to fall into one of two ways of organizing their brands, sometimes without meaning to. The first: the parent company comes first, and the sub-products lean on its shared credibility. Samsung Galaxy, Samsung Bespoke and Samsung SmartThings all carry the Samsung name first. The second: each product is an independent entity, with the parent company standing behind it or entirely invisible. A buyer of TH true MILK may not know TH Group. A Tide user may not know Procter & Gamble.
There is no single right answer. Which approach fits depends on three things: whether the customers of each product are the same, whether the positioning of the products conflicts, and whether the company has the resources to run several separate brands.
When to let a sub-brand lead
There are four situations where a sub-brand should be left to stand on its own, rather than forced to carry the parent company name.
One: the customers of this product and that product from the same company never meet. The same group may sell affordable food on one side and financial services on the other, and attaching a shared name helps no one.
Two: the sub-product's positioning gets pulled down if consumers associate it with the parent company's name. A familiar example in Vietnam: some large manufacturing groups want to launch a premium cosmetics line, but the parent name is already tied to mass-market consumer goods. Attaching the parent name lowers the perceived value of the new line.
Three: the sub-brand is building a distinctive loyal community, with its own language and its own culture. Bringing in the parent company name could break that bond.
Four: the parent company is going through a period of unstable reputation. In this case, letting the sub-brand stand independently can protect the value already built.
When to bring the parent brand to the front
Conversely, there are times when keeping a sub-brand standing on its own forever becomes an expensive trap.
When a business wants to launch a new product into the market quickly, a widely known parent company name is the biggest lever. Buyers do not yet know the new product, but they already know and trust the company name: that is brand equity (the value accumulated in customers' minds) used at the right moment.
When a company expands into new markets or needs to attract partners, investors, or hires, a strong parent company name can do things a product name cannot. A candidate may know the product, but they want to work for the company, not for the product.
When the cost of running several separate brands starts eating into profit without creating clear added value, that is a signal to review the structure.
A brand is not a logo. A brand is how customers feel about your product, service, or company.
Marty Neumeier, The Brand Gap
The risks of each direction
Letting sub-brands stand alone for too long without a clear strategy: brand equity gets scattered. Each product builds its own identity, and each communication budget runs in its own direction. The company grows but no one remembers its name. By the time you want to bring things together, it costs far more than doing it right from the start.
Elevating the parent company name too early or carelessly can dilute the sub-brands or put them in conflict. If two products from the same parent company compete directly on price or segment, putting the parent name first will confuse customers.
In How Brands Grow, Byron Sharp stresses that the condition for a brand to build up in customers' memory is consistent repetition over time. When the brand structure is unclear, every communication effort loses some of its effect, because customers do not know what they are supposed to remember.
A tool to help you decide
Aaker proposes looking through a “brand portfolio system”: asking what role each brand in the portfolio plays. Some brands drive revenue. Some protect a position within a segment. Some test new markets. Once the roles are clear, a business knows which brands need investment to grow, which to leave as they are, and which should be gathered under the parent name to save resources.
Sinh Vũ sees many mid-sized businesses in Vietnam skip this step, not because they do not know better, but because the question usually asked is “what should we name the new product” instead of “how should this product relate to everything else in the company.” That is a design question, but the answer is business strategy.
What you need to check today
Try asking the five most loyal customers of a sub-brand product whether they know which company is behind it. The answer will show where brand equity actually sits in practice, not on internal documents.
If no one knows the parent company's name, yet the company needs to raise it for a specific business reason, that calls for a step-by-step transition plan, not changing everything at once. Conversely, if customers already know and trust the parent name, but the sub-products are heading in many different directions, you are wasting a very real asset.
References
David Aaker, Brand Portfolio Strategy (Free Press, 2004). David Aaker & Erich Joachimsthaler, Brand Leadership (Free Press, 2000). Kantar BrandZ, Most Valuable Global Brands (2020). Byron Sharp, How Brands Grow (Oxford University Press, 2010). Jenni Romaniuk & Byron Sharp, How Brands Grow Part 2 (Oxford University Press, 2016). Marty Neumeier, The Brand Gap (New Riders, 2006).