Ultimate Guide to Complementary Branding

How will complementary branding add actual value to the other brand?

Higher ticket totals.

The new product addition to the current menu will add another choice: like when McDonald’s added soft serve in 1995.  It didn’t cannibalize their existing menu but enhanced it.

A former exec at Subway said this was a critical element to the consideration of adding a brand. Specifically, is this a product that will take away money a customer would have otherwise spent on the Host brand’s offering?  Subway looked for products that would increase the average check.  Trading dollars through cannibalization of current menu products is not a “win.”

When Yum! Brands did their multi-branding, they competed with themselves for the customer’s day-part money; offering tacos, pizza or chicken. This reinforces the importance of ensuring that offerings are truly complementary.

Guest Satisfaction

If you have ever stayed at a Doubletree Hotel, when you checked in you were given a fresh chocolate chip cookie. The cookie enhances the guest’s experience. It is unrelated to the hotel brand in terms of elements like the pool, the fitness center, meeting spaces, or room amenities. But I’m sure when guests talk about their favorite elements of their stay at Doubletree, you can bet the cookies come up. (Look at the comments on Trip Advisor for validation.)

How many cookies does the average Doubletree give away in a day? It is one small step that adds great customer satisfaction and customer delight. What is your venue’s “cookie”?

Resource Efficiency

How can we use our equipment, people, and space better? In the off-peak times, what can we do with our labor to have them go from 75 percent productivity to 85 percent? Granted, during our peak times, they are likely at 100 percent. (Again, a reason the brand addition should be complementary rather than competing.) Starbucks, for example, would likely not want to add a product with a long prep and make time for their busy 7:00–9:00 a.m. day-parts.

Incremental Cost

What is the incremental cost of the product? Convenience and cross-use of food and non-food products come into play here. Can the new product be consumed using our current forks, spoons, napkins, and paper products? As far as the waste goes, can it be minimized?

Topper’s Craft Creamery makes a “grab ’n go” sundae. It minimizes waste. For us, one consideration for soft serve machines is that they are cleaned at regular intervals. When cleaning the machine, all liquid ice cream mix product must be discarded. It’s part of the food safety process. The operator is to run the mix as low as possible to minimize waste, but they don’t always remember. We make five-ounce pre-packed sundaes to run the mix down. The only real incremental cost to make these is the cost of the sauce, the toppers, and the containers. The ice cream mix is, in part, a sunk cost because it will be discarded. Instead of a $.60 cost to make these, they are $.30 when done prior to machine cleaning. It takes about twenty seconds to make each sundae, so the incremental labor is minimal to make fifty of them.

Will there be an increase in return/repeat visits from the complementary brand?

Venue Visits

In my book, “Inside the Box: the Power of Complementary Branding”, I interviewed my friend and mentor Patrick J. George, who was a McDonald’s operator. In this interview, Pat talks about when he offered a 25-cent ice cream cone for kids in order to increase his customer visits. His 25-cent kids’ cones had families coming in after school with Mom, after dinner, or after soccer games or cheerleading practices just to have an ice cream. The extra purchase of a burger, fries, or a second ice cream cone by the accompanying family members was quite frequent. While the product was good, the value was great. This is an example of a resounding “yes” to the question of whether a complementary product will add return and repeat visits to the venue.

I wonder how much the operator’s EBITDA was improved with the addition of soft serve in the short and long term; or the addition of the Egg McMuffin, breakfast, or McCafé?

Frequency

Will a complementary brand increase the frequency of visits to the current brand venue? When done right, absolutely. If the brand executes with a fresh product at a great value, it becomes a Field of Dreams scenario. “If you build it, they will come.” Think of any brand that has added great new products to their menu. When Starbucks added cold brew, it was not only a new product but seemingly a new category. I like iced coffee, but this was next-level: a gourmet iced coffee. It is a richer product than regular iced coffee, and now, they have a Nitro cold brew, which is even smoother than the original. Bravo, Starbucks. And BTW – about ½ of the afternoon visits I make to get a cold brew, I get an order of bacon gouda egg bites for lunch. So it works, at least on me.

Starbucks has Teavana as a complementary brand. In fairness, they replaced Tazo tea with Teavana, and they own the Teavana brand. But the pairing of the two brands made perfect sense. Prior to adding tea, they were missing out on potential customers who didn’t care for coffee or wanted to have an afternoon treat without the caffeine. My next-favorite afternoon drink that brings me into Starbucks midday is their passion tea lemonade. If they didn’t have tea, I would pass on a second visit (if I wasn’t interested getting a cold brew with more caffeine).

Complementary Branding is Exactly What Starbucks did with Teavana.

Had the brands not fit together in quality and distinctiveness, they would not have paired them. And today, the Teavana brand is much more known due to their affiliation with Starbucks. I have friends who are regular Starbucks customers who do not drink coffee. A considerable number of customers enjoy a nice, healthy tea from Starbucks who would not have otherwise been customers at all.

Think about what product line will add new customer visits to buy a new branded product.

Will this complementary day part brand item be an exclusive purchase?

Will the new brand draw customers into the venue to buy their products exclusively? If it’s a fresh pretzel that is part of a sandwich brand at a downtown café, will customers come in just for the fresh pretzel during the off-prime hours of the core brand?

Have you ever gone to Wendy’s solely for a Frosty? And when you went—with the intention of buying only a Frosty—how many times did you end up buying an order of fries or something else? This is where all ships rise.

As an example of cross purchasing products, we give schools free ice cream cone cards that are good for that week. Our experience on this: when we give away 2,000 free ice cream cone cards about 400 of the cards are redeemed. We have found that about 40 percent of those who redeem their cards make at least one additional purchase. These are typically at full price since we don’t allow the use of two special offers on the same ticket. So when we redeem a free small cone at a cost of goods of $.40, and they buy one extra menu item, maybe the smallest items on our menu—a small cone at $2.50—we end up with a gross profit of $1.70 after the 2 cones.

That means that statistically (sorry, I’m a nerd with Rain Man-style math skills), for every one free cone card that is redeemed (only 40%), we end up making $1.00 in profit.

Does it add perceived value?

The perceived value I’m referring to here is from the customer’s vantage point only. If you are a customer, does this new product offering add a better value, a great choice in a new category, or another benefit for them?

What if a national hot dog or burger brand added a gourmet pretzel to fill the snack day-part at a busy retail location like a college campus or an airport? Most have sauces that would be a great match for pretzels (synergy). Would customers buy pretzels from the venue as a more frequent visitor? Could the pretzel be paired with a drink or other menu item as a combo? For example, a snack combo: a pretzel, a drink, and cheese sauce for $3.99. How about pairing a half-order of pretzel nuggets in lieu of fries for a small upcharge? If they do smothered fries, how about smothered pretzels? It sounds delicious to me. Be creative and synergize.

Why will your customers think you are adding a brand?

And “WIIFM?” (What’s In It For Me?) Will they see it as a move to meet their needs… or just greed in an effort to bring in more profit for your business? Remember, the successful trickle-down for the operator is profits from a happy customer.

The easiest way to achieve this is simple: ask your customers what they want? There are marketing folks who have the ability to do this quite effectively. Utilize a broad approach to ask people what they want. Leave it wide open. Getting a couple thousand responses is easier than ever with social media. Narrow down the list to the top three, then find out who the category leaders are in that segment. I have seen this approach put into action quite successfully.

Is there a competitive advantage?

What is your core competency that you do better than everyone else? When you compete with other brands, why do you win?

An added brand must be able to draw a market share—even if it is small— either through expanding the market or cannibalizing other competitors in the category. For example, if you add a complementary branded coffee, the customer who chooses to enjoy a coffee from your venue will be unlikely to purchase a coffee at another location. Someone who grabs your complementary branded pretzel is not likely to also get a snack from another snack retailer (a cookie, chocolates, or candy). Can a Guest brand add 10–20 percent to the Host’s top-line sales? Absolutely yes.

Here’s what the authors of an article about co-branding within Nestlé had to say:

“With increasing frequency, companies are undertaking brand alliance partnerships. This is where two different companies pair their respective brands in a joint marketing effort (Kapferer 2008). Co-branding in particular is often used as a strategy to establish a competitive advantage. It can strengthen the brand portfolio, leverage established brand equity, provide a mechanism for the brand to enter future growth categories and reach important consumer segments. Co-branding has demonstrated its place as a competitive advantage as reflected by the Interbrand top 100 listing the most valuable global brands (Uggla and Åsberg 2010). The Nestlé Company knows this well and has made great strides to capitalize on the merits of solid brand alliance efforts.  (Schee, Brian A. Vander, Timothy W. Aurand, Treneice Pickens, Mary Ma, Anand Ratnakar Girap, “Nestlé: Brand Alliances”)

W. Edwards Deming, a noted professor, engineer and author said “Innovation comes from the producer—not from the customer.” This means that you must be the catalyst in your search. It will be worth it. The innovation process comes from the brand leaders to allow and become a complementary brand. The selection of the “what that innovation looks like” should be customer-driven. When you are looking for the right complementary brand pairing, after asking your customers what product category they want, invest the time and resources to find out how to give it to them. Complementary branding can give you a big competitive advantage. Do your homework!

What’s next? How do I choose the right partner?

How do we Build a Successful Partnership?

Michael Jordan, maybe the greatest basketball player in history, with 6 world championship rings said “Talent wins games, but teamwork and intelligence win championships.”

It is important as you approach an agreement with another brand that you are ready to be de facto partner and a teammate. Michael Jordan is absolutely right. If you are going to win a championship, it takes a great team. As you learn to complementary brand, approach it as a common goal to win a proverbial championship for your operators. Great players, working together, contribute to being a champion. Think of complementary branding as a team sport, not an individual sport. Think hockey, not golf.

And remember, the “halo effect” is in action. That halo of connection, whether positive or negative, will bind you to your new partner, in both reputation and action.  The legal folks will keep things divided and exposures separated, but there are topics that need to be discussed collectively when approaching the complementary day-part branding process.  When pursuing a brand partnership, consider what kind of brand might be truly complementary to yours.

The Two Key Elements of Complementary Branding Partnerships are:

• Brand name recognition
• Brand quality and distinctiveness

On the quality side, the metric is simple. The genuine quality of the product must meet or exceed the quality of the recognized brand. It may be a new brand or an unbranded product that adds considerable value to an existing brand. In food, is the complementary day-part product just flat out delicious? It has to be. But great taste is not enough. The unit economics of the complementary brand offering must add strong profits. A great complementary brand offering will bring with it category expertise, supply chain advantages, and other economies of scale that can provide a simple offering with a high profit margin. I would keep the EBITDA target requirement at or near 50 percent of complementary brand sales.

Brand name recognition happens from meeting these quality and EBITDA metrics. If an unknown, emerging brand achieves both of the above, they won’t be unknown for long.Every big brand started with their first location.

Next, some important tips on partnerships.

Why Partnerships Fail

1. Unrealistic or unclear expectations. This is the most common source of friction. Unmet expectations stem mainly from a lack of honest and open communication. Set expectations for both brands clearly.
2. Cultural incompatibility. It is important to play to the strengths of each brand. All brands are different. Instead of focusing on the differences, focus on where you are the same. What synergy exists with the two brands? If you find you are too distant in terms of culture, it would be best to reconsider.
3. Power differences. In most situations, the power rests with the primary brand. This is part of the negotiated agreement upfront. It is important to spell out the element of control.
4. Lack of brand integration and methodology for the integration. It is important to have a clear plan in place for what each brand will do in the proposed space.
5. Absence of metrics and accountabilities. This is outlined in having a clear understanding of expectations—knowing what benchmarks must be hit and by whom.
6. Unwillingness to commit time and resources. Each brand must be responsive to the operator and to one another to provide support.
7. Relationship breakdowns and absence of trust. Once trust has been violated, it is very difficult to move forward. Be especially cautious of this and make sure your two-way communication is clear and effective. Finger-pointing leads to failure.
8. External forces and changing priorities. What happens when things change (site characteristics, ownership of the site, or the operator of the site)? Consider the first seven steps above to find the “new normal” for the brands. It should end up better than before.

Why Partnerships Succeed

1. Organizational readiness. You have a solid plan, and each brand is ready to move forward to execute the plan with strategy, structure, and people.
2. Mutual needs and opportunities. Each partner will be able to meet or exceed their needs and be able to fulfill their goals.
3. Realistic goals. Each partner has their goals, and you have clearly communicated these goals with one another, whether that means unit growth, sales levels, profit levels, or other goals.
4. Partnership process and framework. You have a written agreement that spells out the specifics for each party in the complementary day-part brand venue.
5. Capacity and commitment. This includes both brands and, most importantly, the operator of every location. These elements must be in place. Of the skills, resources, and will to succeed, the will of the operator is the most important element.
6. Effective communication. You have the information network in place to communicate and the discipline to use it. Unfiltered two-way communication is critically important. Note: sending an email is not communication; it is informing someone.
7. Shared values and compatible culture. It’s important that you understand and share common values. Create a culture that is consistent with your values together.
8. Performance measurements and reporting mechanisms. Measure success against agreed-upon metrics, and have a process in place to report data.
9. Unrelenting focus on the operators. This is a non-negotiable. If you neglect your operators’ best interests, you will fail. Complementary day-part branding is a challenge. Like marriage, it works if both sides work at it.

The following is a list of guidelines to help you through this challenging but rewarding relationship.

What are the Guidelines for Complementary Day-Part Branding Partnerships?

• We are in the business of building and sustaining partnerships with franchisees in our respective brands. Thus, we are in the relationship business.
• Stress in our partnerships comes mainly from two areas:

The partnership does not adequately reward our time and effort.

The partnership does not reflect well on the development of one of the brands.

• Be firm and consistent on business issues in order to survive and thrive. Build and grow your respective brands. Agree to disagree.
• Partners should always be treated with respect. Accordingly, tough issues should not be handled by email but through personal connection. Seek to maintain a dialogue of win/win.
• Partnerships involve mutual accountability for the benefit of the brands. Listen to partners if they believe obligations have not been fulfilled.
• Provide systematic support and systematic termination.
• You have the right and obligation to determine at what point you can no longer afford to continue together (or working at a specific site). This can be due to lack of payments, lack of compliance with meeting one brand’s standards, or the failure to demonstrate mutual respect. This should only happen after steps have been taken to listen to the other brand’s position, to communicate our position, and to make an effort to reconcile these differences.
• Finally, integrity and character matter. If a franchisee demonstrates poor judgment, choices or behaviors in matters of character or integrity, you have an obligation to the brand’s stakeholders to terminate the partnership to preserve the overall image of the brand.

How do we successfully put the brands together: Secrets and hacks for brand integration

This is the next step toward your success; how to piece the puzzle together. Here are the things to consider as you are building your roadmap to greater success through co-branding.  How does it fit to get me the strong EBITDA (real cash profits) for our brand and our shareholders?  We have extensive experience, research, trials, and case studies, all of which add up to how we have cracked the code on co-branding.

As we continue, keep these two questions in mind:

1. How would it work within our brand to add a complementary day-part brand to our space?
2. How could it work to make our brand into a complementary daypart brand offering to go in with another brand in their space?

I promise that the time, energy and expense in dealing with these questions will enhance your EBITDA and that of your operators.

Simplicity

I know I stressed simplicity in the previous chapter, but it bears repeating. Putting together multiple brands in their current forms with full menus and product offerings will typically not work. It has not worked well for most of those that have tried it, and it is only marginally successful for those who continue to do it. Many of those doing it are actually more of a “shared use” than a true “complementary brand” offering. Success can be achieved, but the complexities are what get in the way of fluent execution. Less is more.

One example: I recall when Wade, my business partner, tested a new process in his Qdoba Mexican Grill in Tampa and Orlando, transitioning to a streamlined format that offered a simpler pricing tier with the choice of whatever the customer wanted on their burrito, bowl, or salad. In Wade’s eight locations, their guacamole use tripled, but that was good because it was constantly freshly made, which made it even better. (As a guac fan, I can assure you that freshly made within the hour is better than freshly made that morning.) They kept it simple.

The same requirement holds true in complementary day-part branding. Offer a limited menu of products, make them great, and cycle through them regularly. Do more with less, and be great with the less that you are doing. If you offer a truly great product; simplicity allows for the constant production of that product. And your customer will appreciate its freshness.

Examples of Simplicity

My hat goes off to Jimmy John Liautaud of Jimmy John’s. They keep it simple. Roast beef, ham, turkey, salami, capicola, bacon, tuna, and provolone cheese. They offer a considerable and hearty menu using a few simple ingredients. Brilliant.

Now let’s consider a smoothie operation. What are most people’s favorite smoothie ingredients? Strawberry, banana, protein powder, blueberries, mangos, or greens? Smoothie operators will have their product mix reports that show which options are the most popular. That’s a short list of products. What smoothie bases are offered? And which ones are the most common? Rather than offering several, source a natural fruit juice blend with no sugar added, and no artificial sweeteners. Many smoothie brands’ offerings are made with four to six different bases offered as options: strawberry-based, pineapple or mango-based, yogurt-based, no-sugar-added strawberry, almond milk, soy milk, and the like. Pick the most popular one (mostly it will be a natural NSA juice).

In July of 2018, I looked at the menu for Smoothie King online. There were a total of 70 different smoothies on their menu. If I were advising Smoothie King on how to be a great complementary brand, I would ask them what their ten top-selling recipes are and suggest that they decide how to offer six of those by cross-using ingredients. Keep it simple. Keep it fresh. It’s a complementary brand, not a full menu.

How does this apply to your brand?

It’s a simple process, but not an easy one. Limit your offering like Jimmy John’s. Offer one of the fruit juice bases described above and a high-quality selection of the four most popular items on your menu. Maybe: 1. Strawberry 2. Blueberry 3. Banana 4. Mango.  You can also offer a greens supplement and a protein supplement. This means you can offer three or four choices from your very small menu board. Let them build it. The customer gets to make it how they like it from the combinations of these four flavors; plus the two optional add-ins (the greens supplement and the protein supplement.) And you offer everything at the same price, keeping it simple.

This is the same fundamental used by companies like Subway and Chipotle; make it how you like it and all at one price. It’s what we do with smoothies at our Skyye Café at the Tampa Airport Marriott and at our Renaissance Orlando SeaWorld operation. Line item pricing menu categories keeps it simple. We do the same at our Express operations. If you want a plain cup of ice cream, it’s one price. If you want caramel, chocolate, sprinkles and Oreos – it’s the same price.

How Topper’s Craft Creamery Keeps it Simple

We offer our crafted soft serve French vanilla bean frozen custard, chocolate frozen custard, and a swirl of the two as a complementary brand in traditional and nontraditional settings. It is an “Express” operation and is the single most simple, all-inclusive brand I have ever seen. We did that on purpose and by design. Keeping it simple is our mantra. If you are going to succeed at complementary day-part branding, it must be your mantra, too.

Our product requires one machine that spans twenty inches across. Everything needed for the operation of an Express soft serve ice cream shop is provided. This includes the fresh waffle cone maker to make hand-rolled waffle cones and hand-formed waffle bowls. Plain sundae cups and plain cones for customers who do not want the waffle cone or bowl are offered. Sauces are limited to chocolate and caramel sauce. While there are other flavor options, we suggest only two. Dry toppings can be used as both a cone-rolled item as well as a sundae topper: Oreos, rainbow and chocolate sprinkles, occasionally chocolate chips, and fresh waffle cone pieces (left over from yesterday’s waffle cones, which are made daily).

Employee training typically takes just two hours from start to finish. Even our supply chain has been streamlined providing delivery from one supplier.

We deliver world-class support for our operators. Win-win-win, simple-simple-simple. What does your “simple” look like?

Why is co-brand interface important?

Winston Churchill said “Success is stumbling from failure to failure with no loss of enthusiasm.”

We got great at interfacing through 2 years on the complementary day-part branding team; where I spent 50 – 60 hours a week for 2 years – literally eating, sleeping, and breathing complementary branding. At Topper’s Craft Creamery, we have done multiple pilot tests in multiple venues with an eye toward pioneering successful complementary branding. Some of it was intentional, and some was the learning from what did not go as expected. We needed to make sure we understood how to interface our brand with multiple product category offerings together with different brands. That interface learning is the foundation of success.

This information is the sharing of best practices for all brands in all categories to see how it might fit for them. Whether food, service, or other; there is often an opportunity to complementary brand. The questions of “what fits”; “how do you set it up”; and “how do you run it” are universal for complementary branding. Our fundamental decision to keep things simple was based on my experience as part of the 2-year complementary day-part branding task force and rigorous testing. We made a conscious choice several years ago as part of our investment capital to pilot test different complementary branding options in different venues. The research was powerful for us, as we continued to interface different product lines together and make them work efficiently and profitably.

Next Thought Process Example:

Cross-Use Equipment, Space, and People

What equipment can be used for multiple menu items? If I have a turbo cooking oven, what else could it use it for? I might currently use it for breakfast sandwiches, but can I make cookies in it or other baked goods? Can I make breakfast pastries, pretzels or churros, sandwiches or flatbreads?

How do I Maximize my Sales Per Square Foot?

I want to ensure the best possible use of my floor space. If I’m doing $1 million in annual sales in 2,000 square feet, that’s $500 per square foot per year in sales.  How can I increase that in a meaningful way?  Here is an example using a pretzel complementary branded product:

Hard Numbers for Soft Pretzels

If I add pretzel nuggets to my menu, and it takes up a space of four linear feet of counter space for the oven and mixer and another two linear feet for the warming holder, what does that equal? 4 linear feet + 2 linear feet X 30 inches wide (countertop) = 15 square feet.

You can cross-use your current prep table space. With those numbers, it means that if I sell thirty-five pretzels per day for $4 each, that adds $51,100 in sales annually. That’s a good number. If the incremental costs of food, occupancy, minimal labor, and fees are factored in, the true added profits are mind-blowing excellent. And the metric for the space is well above the current sales per square foot. 35 pretzels per day X $4.00 each = $3,406 per square foot in added sales,

In my example, the revenue per square foot is nearly seven times what the current brand is doing; and the space is likely available by just being more efficient with your layout. Get creative and figure out a way to put this complementary brand in. Or figure a way to make your brand fit as a complementary brand in the same dynamic.

What is the “Real Cost” of Added Labor

I’d like to make one quick operator note on this: If you make enough raw product to sell thirty-five pretzels, how much added labor will that require? How many employees would I need to call in to work, or keep on duty to make and bake 35 pretzels? If you can do it during your off-peak hours, isn’t the incremental labor practically zero? That is the core of complementary day-part branding. Though I have only researched and gone to observe making pretzels, the process seems simple. After mixing your dough, use or refrigerate the dough for fresh pretzels, now or later. By making small batches more often, you can take advantage of the fresh smell to draw in buyers. We call it “aroma marketing.” (The customer’s sense of smell is a key factor in their purchase decision.)

For output, you make six to twelve small trays of fresh pretzel items for your guests a few times each day, throughout the day, to keep the freshness and aroma rolling.

How can I track my labor efficiency?

Since the above pretzel example shows the minimal incremental labor, figure out what your extra cost might be.  Remember, this is done in the complementary day part, rather than your rush day part.  In my experience as a seasoned operator, the true operational cost is less than you think. If we look at this sort of scenario inside a high traffic venue, a strong part of your sales will come when the aroma is still in the air shortly after the fresh pretzels are made. And if you are selling each batch, make another batch. This is a cause/effect reality for the new brand’s sales during the off-peak hours for the venue.

Seriously consider what is the real added time to do this during the course of a shift, with a complementary brand? If preparing the pretzels can be done during the off-peak hours, without bringing in or keeping extra labor; then the actual time to ring the sale and package the pretzel is part of the normal process of order taking and order fulfillment, and does not add extra labor dollars. This is the fundamental advantage of complementary day-part branding.

People

The day-part addition is the key. At Dunkin’ Donuts, Baskin-Robbins brand was added was to increase the slower parts of the day. The same is true for Tim Hortons and ColdStone Creamery. I also see Starbucks going firmly after the post-morning day-parts. They want to fill in the afternoons and evenings with a steady stream of customers. They recognize that they have core customers throughout the day, and they have an opportunity to more efficiently utilize their spaces and people during the slower day-parts.

In the Tampa International Airport, Starbucks has begun offering crafted alcohol options for evening customers, and this space has gone to a 24/7 operation. They have gourmet tea infusions, lunch sandwiches, and an advertised Mercato offering coming out to meet a post-morning day-part. The point is, if your operation is open, and sales are slow during different day-parts, how can you supplement your offerings to get more customers in, or get your current customers to come back a second time? What Starbucks has done is genius. Keep thinking about how you can efficiently boost your offering to customers.

What if your secondary slower day parts became 50% of your peak hours of operations, rather than 15%, as is the case in some brands. How do I fill in that mid-afternoon snack or treat, or that evening/night snack or treat?

Synergy of Products

Jim Rohn, entrepreneur, author, and motivational speaker says “If you are not willing to risk the unusual, you will have to settle for the ordinary.”

What food products fit together best? Some are obvious (like coffee and donuts), but some are more obscure. For instance, I had a discussion with a French fry brand about possibly combining with Topper’s Craft Creamery. They do great fries, and we do great soft serve. How about combining them? A great product is one thing, but is there synergy between these products? Does this combination fit with what today’s customers want?

Today, food is as much entertainment as it is a pleasure experience. We love our meals and snacks, but we also love to put things together and throw out a message on social media. We like to be different. Maybe dipping fries into a hot fudge sundae is “newsworthy” on social media. It’s gonna either be “that’s awesome” or “that’s gross,” but it’ll get the desired attention of the person posting the pictures. Likes, loves, or angry faces— there’s no such thing as bad publicity.

Unique Food Pairings

When my wife was pregnant with our firstborn, I made three or four trips to Wendy’s every week to get a single burger with mayo, extra pickle, and cheese, plus a Frosty and fries. She dipped the fries in the Frosty, and honestly, it was pretty good! Burger King had a bacon sundae at one point. I made some for a group of kids on a church retreat for a snack one night (I was a volunteer chef at my church), and the results were surprising. More kids were trying to mooch their friends’ chocolate-dipped peppered bacon and eat it with their French vanilla bean ice cream topped with fudge, than were giving theirs away; about 4:1.

Another good example of synergy is Chick-fil-A lemonade with IceDream. I love their lemonade, and their soft serve is very good. Chick-fil-A combined the two for a frozen treat that is super tasty. An “IceDream” is available in cones, shakes, lemonade and coffee drink recipes. Cookies are also available. Synergy: Take what you have and make some great new combinations. Chick-fil-A is insanely busy most all of the time, and I give them “respect” for how efficiently and quickly they handle the massive flow of customers. They were the first brand that I remember seeing with dual drive-thru lanes, hand-held POS technology, and cashiers outside to run the lanes faster. They are innovators. Like I said: respect.

Fresh-Baked for the Win

At Topper’s Craft Creamery, we have recently implemented freshly baked brownies. I wish there was a national brand with an offering we could have leveraged. Fresh baked brownies can be added to all of our various menu offerings. Utilizing the same method explained above, small batches are baked ensuring a fresh product. Currently, fresh baked-on-site Nestle Toll House Chocolate Chip Cookies are being tested and considered as a menu upgrade to replace those being sourced from a provider already baked. Leftover cookies are made into chocolate chip cookie ice cream sandwiches that are rolled in chocolate chips. The cookies are used in the same way as the brownies. Fresh, and fully utilized. Keeping it simple, keeping it smart, and keeping it within our core competencies.

Synergy is just being creative and thinking about what you currently have in your operation and what can fit together. If there is a step to create a new product, what is the process? Making ice cream sandwiches from leftover cookies offers a path to positive use of a product that would likely be discarded otherwise. If you have ten cookies left over, make five ice cream sandwiches. You get the idea.

What is the definition of brand pairing, co-branding, or complementary branding?

First of all, I have to say I’m kind of a nerd on this.  Over the past twelve-plus years since we cofounded Topper’s Craft Creamery, I have studied articles, case studies, and everything I could get my hands on about the various forms of brand pairing. (Like I said, some of us are just nerds when it comes to certain things.) My interest in complementary branding was piqued years ago and still runs with a fire through my veins.

Putting brands together is known by several names, some are defined below.

Co-branding:  Also known as “brand partnership.” Co-branding is when two companies form an alliance to work together, creating marketing synergy. Complementary branding would fall inside the definition of co-branding.

Complementary Branding  A mutual affinity in which participants with different brands—bring different products or service offerings together—to do what is in their joint interest and sustains the relationship. Our definition, in this case, includes different day-parts for the brands. It is 1 + 1 = 3

Brand Pairing  A specific marketing strategy designed to transfer the positive brand equity of two or more partner brands to a newly created joint brand. You see a lot of this in retail: like Bonnie Bell kip gloss with Dr Pepper flavor.

Multi-branding A company marketing several similar products as competitors, each with its own individual brand name.

It is important to understand who you are as a brand; what are your core competencies, and what gives you a competitive advantage in the marketplace.  Once known, you can leverage that into a brand pairing partnership that will benefit you and your operators EBITDA in the greatest way.

The addition of a complementary brand will add three elements to your primary brand:

1. Your customers spend more money while they are in your space.
2. Your customers come to your space more often, to purchase your new offering.
3. You create greater value for coming to your space, which allows you to charge more than your competitors for the convenience and value of the experience.

Sometimes, you might need to approach this like MacGyver… mission-driven, flexible, and innovative, so you will achieve the desired outcome.

Why outsource with another brand rather than create one in-house with our R & D?

The Outsourcing Movement is here. Why outsource with a complementary brand rather than create your own offering? Do the cost/benefit analysis. Today, all of us in the food and franchise industry face margins that are being squeezed; by fixed costs like insurance, rent, and utilities; and squeezed by variable costs like labor.

In June, 2018, the federal minimum wage was $7.25/hour, observed by fourteen states. And there were fourteen states with minimum wages above $10.00/hour, the highest being Washington D.C. at $12.50/hour. There is a national movement underway called the “Fight for 15.” This represents workers in several industries—fast food, retail, home care, and many other categories—seeking a minimum wage of $15/hour. Brace yourselves, because it is coming, and will likely be catastrophic.

How do we do more with what we have?

It’s clear that something has to change. In response, the outsourcing movement is underway (offering a complementary brand rather than trying to develop a new product). We see this as a new normal rather than a trend. It started as a trend, but we all have to face the facts of accelerating change.

Steve Jobs from Apple saw clearly what was coming. Much of it was in his head, and he had an uncanny sense of what customers wanted. Their “think different” ad told you as much. We didn’t understand at that time that we would have computers as phones, and tablets with hundreds of times more power and speed than we ever thought possible. It said,

“Here’s to the crazy ones. The rebels. The troublemakers. The ones who see things differently. While some may see them as the crazy ones, we see genius. Because the people who are crazy enough to think they can change the world, are the ones who do.” 

Most of us now understand the accelerating rate of change of things today. It is not limited to technology, but is everywhere.

When you outsource with a specialized brand, the single reality that is nearly 100 percent consistent is that the product will be good. Think Cinnabon. Think Starbucks.

Instead of trying to develop something from scratch, you’re working with a brand that has already proven itself as an expert in their core competency. The quality of the raw materials will have been tested and retested. You can taste and see the product to determine whether it fits. Complementary branded products are tangible and available for you to test personally, right now.

The supply chain will be sound, and the operations process will be clean and consistent. There is a product track record. These brands are at a level of expertise that you will not achieve in a new product that you develop. Why reinvent the wheel? Go with a proven product that already has customer acceptance.

I hold a Master’s Degree from the University of South Florida, Tampa in Management: Leadership and Organizational Effectiveness. I’m a huge fan of the work of Dr. Peter Drucker, a management consultant, educator, author, and winner of the Presidential Medal of Freedom. I have already quoted him more than once in this book. Dr Drucker is THE legend in management. Regarding outsourcing, Dr. Drucker once said,

“Do what you do best, and outsource the rest.”

Amen, Dr. Drucker. May you rest in peace.

Don’t spend precious time and big dollars creating and adding a new complementary day-part product when one is already available. Spend time negotiating a win-win deal with a complementary brand, rather than spending time and money on research and development. Just look at the difference in speed to market. It can be weeks or months vs. years. A new complementary brand only needs to be learned and executed—not created from the ground up. Plus, outsourcing a product or service should provide consistency in customer experience and will keep the promise you have made to your customer.

Starbucks started this years ago with their “We Proudly Brew Starbucks” model in military bases, universities, healthcare and hospitality venues. They said they would come in with their brand, provide the equipment, supply chain, training, and support for the venue to run their Express brand in their venue.  They have thousands of these Express offerings all over the world; now called “We Proudly Serve” Starbucks.

So when adding a new product line, your two options are:

1. Add a complementary brand with an established category expert.
2. Create a complementary product from scratch

As said above, let’s talk coffee. Any brand can add coffee to their offering. Buy a brewer, source the product, and learn how to execute the complementary coffee menu. But what about the supply chain; the marketing; the integration with your current menu; the selection and cost of equipment; the training process for the new item? How long will it take to pilot test the process before adding it to a few locations in a field test? How long until it is rolled out across the entire brand as an option?

Or Plan B; you can call Starbucks® or Seattle’s Best, Kahwa, Joffrey’s, Café Bustelo, BIGGBY, or another coffee brand. You will be in the coffee business within weeks.

But anybody can create a new product. It’s simple, right? But what are the real costs of developing a new product? According to “Branding for Dummies 2”*, the cost of name development, a logo, and core presentation of the product or brand ranges between $23,500 and $475,000. That doesn’t include any advertising, SEO, social media, or any other costs. It is just the creation of a new something. Then cross your fingers and hope it works.

*Chiaravalle, Bill and Barbara Findlay Schenck. Branding For Dummies, 2nd Edition. Hoboken: Wiley Publishing, Inc., 2007.

Are You Ready for Complementary Branding?

If you enjoyed this Ultimate Guide to Complementary Branding, read the full version of this article in my book, “Inside the Box: The Power of Complementary Branding.” It’s also now available from Audible. If you’d like to speak or connect personally, shoot me a message via the form here. In the meantime, give our editable proformas a try to see how profitable adding a complementary brand can really be.